After the 2008 crisis the focus of the European Union education policy on the Vocational education and training measures erupted.

 

It is understood that the structural changes associated with transition have been unfavourable for unskilled workers who have lost employment disproportionately as the skill content of blue collar work has increased due to skill-biased technological change (Commander and Kollo, 2004).

 

In the light of these developments, this paper has examined institutional framework for vocational education at the national level and on local level and points at the deficits of the VET systems at place and their historical heritage in the Ex Yugoslav educational system.

 

The paper explored how countries address dropout rate problems, organise selection and mobility into the vocational schools and provide practical training and apprenticeships and their connection to employability.

 

Finally, the paper provided recommendations for each of stakeholder groups for improvement of the VET system and its role in improvement of connection between VET education and labour market in Bosnia and Herzegovina.