Colleges are placing thousands of students on courses which will do nothing to improve their career prospects, a study has claimed.
There are no measurable financial benefits to NVQ level 2 qualifications studied in colleges, according to a review of evidence by the UK Commission for Employment and Skills.
But the review found good news for Train to Gain: the same qualifications could be worth 10 per cent higher wages when studied at work, the greatest benefit for level 2 NVQs yet measured.
Government training programmes fared even worse than colleges, but the study said the circumstances of unemployed people were likely to be responsible for the differences.
About half a million people study NVQs at level 2, with about half of those being work-based Train to Gain students.
The study comes as the commission is pushing for consumer labelling on college courses, to give students information about their chances of success and employment on any particular programme, as well as arguing that colleges should charge more fees.
Chris Humphries, chief executive of the UK commission, said more needed to be done to ensure all vocational qualifications gave good returns.
"Even though returns have been improving over the last five years, there is still plenty of scope for improvement, and the challenge is now to get all vocational qualifications matching the returns we're already seeing from the best," he said.
The review showed that vocational qualifications were valued by employers, he said. A Btec level 3 qualification typically added 18 per cent to earnings.
"Vocational qualifications have long been considered the poor relation to their academic counterparts, but this research shows that many vocational qualifications provide real and tangible benefits to both employers and individuals, sometimes providing pay increases which nearly match those expected from academic qualifications," Mr Humphries said.
However, the review said that five good GCSEs - a level 2 qualification - would give a higher earnings boost, at 25 per cent, than level 3 vocational courses.
It warned that the lower value of vocational qualifications may just represent a social bias that tended to draw the most able students, and those most likely to be high earners, onto an academic track.
Depending on the industry, there were wide variations in the benefits of vocational courses, with a level 2 Btec in finance worth a 30 per cent earnings boost.
But the report dismissed claims that low level NVQs could actually harm earnings. Some studies found that people saw their earnings fall in comparison to others without the qualification.
The review rejected the conclusion that the qualification would cause employers to offer lower wages, and said it was probably a reflection of the lower earning potential of the people who chose to study low level NVQs.
The Association of Colleges questioned whether the small sample sizes in the studies under review were providing reliable data about their students and said that improved earnings were not the only measure of qualifications' value.
A spokeswoman for AoC said many NVQ students were studying qualifications that give them a licence to work in an area such as care or early years learning, and enabled them to get on the bottom rung of the career ladder.
Society as a whole benefits from a better trained workforce in these areas and many would go on to gain higher level qualifications that would improve their earnings later, she suggested.
"I think this raises as many questions as it seeks to answer and would concur with the report's final conclusion that more targeted research is needed," the spokeswoman said.
Editorial, page 23
A LEG UP
Increased earnings for qualifications delivered in all settings compared to no qualifications
2+ A-levels: 44 per cent
1 A-level: 34 per cent
5+ GCSEs: 25 per cent
Btec level 3: 18 per cent
City Guilds level 3: 17 per cent
1-4 GCSEs: 14 per cent
NVQ level 3: 11 per cent
Btec level 2: 11 per cent
City Guilds level 2: 7 per cent
NVQ level 2: 4 per cent.