De-Tracking and school to work transition: Evidence from a German Secondary School Reform

Early tracking can reinforce educational inequalities by limiting upward mobility, particularly for students from disadvantaged backgrounds, in particular those with a migration background. In Germany, students have traditionally been divided into three distinct school tracks at an early age, resulting in low educational mobility. Around 2010, eight of the sixteen German federal states responded by restructuring their secondary school systems: they merged lower-tier schools (Hauptschule and Realschule), thereby replacing the traditional three-tier structure with a two-tier system. While previous studies have examined the effects of similar reforms on academic performance, we focus on their impact on educational attainment and transitions into employment and post-secondary education. Our analysis exploits variation in the timing of reform implementation at the school level and applies a difference-in-differences design using rich administrative social security data. The data cover more than 100,000 students and link their education and employment histories to 186 post-reform schools. We find that the educational attainment of migrant students improves following the reform: the share of students leaving school with only the most basic degree declines by 3.6 percentage points, corresponding to a 16 percent reduction. Despite these gains in school-leaving qualifications, effects on school-to-work transitions 10 years after secondary school enrolment (at age 20/21) remain limited. Migrant students spend more days in training after the reform, a result mainly driven by disadvantaged migrants from welfare-dependent households, but vocational training participation, employment rates, and wages remain unaffected. By providing causal evidence on the effects of detracking, our findings contribute to the broader debate on educational mobility and offer important insights for policies aimed at reducing structural inequalities in education and the labor market.