The expansion of vocational courses in Portugal: what are its impacts on education, employment and entrepreneurship?

40% of upper‑secondary students in Portugal are enrolled in vocational programmes. The country is now closer to aligning with the European Union average of roughly 50% than it was at the turn of the 21st century.

Vocational education and training (VET) has expanded since 2006, due to factors such as the need to diversify educational offerings, the extension of compulsory schooling and financial support from the European Social Fund.

Produced by researchers from Nova School of Business and Economics’ Economics of Education Knowledge Centre – Luís Catela Nunes, Pedro S. Martins, Pedro Reis and Teresa Thomas –, this policy paper analyses the effects of the expansion of VET since 2006, finding positive outcomes in education, employment, new business creation and entrepreneurship.

VET has improved academic results and fostered greater social inclusion, with the failure and dropout rate falling from 39% in 2000 to under 10% by 2023. Moreover, the proportion of students completing upper secondary education rose significantly, especially among socio-economically disadvantaged groups.

Furthermore, VET reduces economic inactivity among 25–34 year‑olds: only 5.6% of Portuguese VET graduates are economically inactive, much lower than the inactivity rates for general secondary education graduates, which stand at 10.6% in Portugal and average nearly 11% across the EU and OECD.

The authors highlight that 72% of students who completed secondary vocational education without pursuing further study found employment within one to two years, compared with 56% of general secondary education graduates.

Using microdata from the education system and the labour market, the authors also observe that VET has, albeit moderately, boosted employment in the occupations these courses focus on.

Three years after completing a newly introduced vocational course, there was an average 20% increase in the number of workers in the corresponding profession at the regional level. However, this effect is less pronounced at the municipal level, which suggests a degree of geographical mobility among graduates.

VET has an even more striking impact on new business formation and entrepreneurship. The Foundation’s research finds increased dynamism in the business sector, with a significant increase in new enterprises three to five years after VET graduates enter the labour market.

The authors propose various policy recommendations to help Portugal keep pace with Europe’s renewed investment in vocational education. Most importantly, Portugal should:

• Align VET programmes with labour‑market needs
• Foster regional coordination through intermunicipal planning
• Expand VET offerings in underserved regions
• Ensure curriculum balance and flexibility
• Elevate the public image of VET