What makes a NEET?

by Karinne Logez
Statistician, Directorate for Education and Skills

NEETS - young people aged between 15 and 29 years old who are not in employment, education or training - are a potential problem both for society and for themselves. The proportion of young people neither working nor studying offers an insight into how well economies manage the transition between school and work – better than youth unemployment rates, which do not take into account the numbers in education. It's especially illuminating when the figures are broken down into those who are still looking for work ("unemployed") and those who have dropped out of the labour market altogether ("inactive"). Particularly worrying are those in the very youngest age bracket – aged 15 to 19 – who may not have completed their secondary education and are disproportionately likely not even to be seeking work. There’s a risk they may never catch up with their better educated peers.

So what makes a NEET? And what can governments do to make sure young people successfully make the transition from education into work? The latest edition of Education Indicators in Focus suggests that there are several intertwined factors.

Is it the educational system?
As well as increasing their education participation rates, making the educational system more relevant to the labour market may help reduce NEET rates. Countries with widespread work-experience programmes, offering recognised vocational qualifications, see higher levels of young people in employment and lower NEET rates, although the effect has been more muted in this current economic crisis.

Is it the state of the economy?
NEET rates and employment-to-population ratios tend to mirror the economic cycle. When times are tough it’s harder to find a job or keep the one you have if you’re competing with more experienced workers. Fortunately, many young people react by staying on longer in education instead, so when the economy picks up, they’ve got a head start finding work. As young people are the main source of new skills in the labour force, increasing education participation rates are an encouraging trend.

Is it a cultural thing?
On average, young women are more likely to be NEET across the OECD than young men. In some countries – such as Turkey and Mexico – this effect is particularly marked. It may reflect expectations that women will be concentrating on starting a family than forging a career, particularly where young women are disproportionately inactive rather than unemployed and seeking work.

Is it an age thing?
Generally, the demographics are on the young people’s side – as the population in OECD countries age, and the proportion of young people in the population fall, both employment rates and education participation rates should increase. At the moment, economic stagnation has counteracted the effect of demographics, but once the economy picks up, young people should be well placed to forge ahead.

It’s all of these
Clearly the problem of young people dropping out of education and the labour market is a complex one with no single determining cause. However, the consequences for both individuals and society mean that it’s important to prevent young people becoming NEETs – and help reintegrate them back into work or education if they do.

For more information
On this topic, visit: 
Education Indicators in Focus: www.oecd.org/education/indicators 
On the OECD’s education indicators, visit:
Education at a Glance 2012: OECD Indicators: www.oecd.org/edu/eag2012
OECD's Actin Plan for Youth
OECD Forum 2013: Give youth a chance
OECD Skills Strategy Spotlight: Apprenticeships and Workplace Learning
OECD Skills Strategy

Chart source: OECD Education at a Glance 2013:  Indicator C5 (www.oecd.org/edu/eag.htm) to be released 25 June, 2013

Getting our youth back to work

by Andreas Schleicher
Deputy Director and Special Advisor on Education Policy to the OECD's Secretary-General

If there’s one lesson we’ve learned over the past few years, it’s that we cannot simply bail ourselves out of a crisis, we cannot solely stimulate ourselves out of a crisis and we cannot just print money our way out of a crisis. But we can become much better in equipping more people with better skills to collaborate, compete and connect in ways that drive our economies forward.

There is no group for whom this is more important than today’s young people. Between 2008 and 2011, the gap in unemployment rates between higher- and less-educated youth widened dramatically. While young people with advanced skills have weathered the crisis reasonably well, those without foundation skills have suffered. Unemployment among young people without a high school education soared 20% in Estonia and Ireland and 15% in Greece and Spain. The short-term impact on individuals, families and communities beg for urgent policy responses; the longer-term impact, in terms of skills loss, scarring effects and de-motivation, will affect countries’ potential for recovery. Without the right skills, people will languish on the margins of society, technological progress will not translate into economic growth, and countries can’t compete in the global economy.

What’s often overlooked amid the grim statistics is that a few countries, like Austria, Chile, Germany and Korea saw a sizeable drop in unemployment rates among their low-skilled youth. What this tells us is that, with the right policies and economic environment, we can do something about this and it seems to boil down to three actions: build the skills that foster employability; give young people the opportunity to make their skills available to the labour market; and ensure that those skills are used effectively at work.

To begin, we need to be able to anticipate the evolution of the labour market: we need to know what skills will be needed to reignite our economies. The coexistence of unemployed graduates on the street, while employers say they cannot find the people with the skills they need, shows clearly that more education alone does not automatically translate into better jobs and better lives.

We need to put a premium on skills-oriented learning throughout life instead of on qualifications-focused education that ends when the working life begins. We need to tackle unacceptable rates of school dropout by offering more relevant education and second-chance opportunities, and by offering work experience to young people before they leave education.

OECD’s Learning for Jobs analysis shows that skills development is far more effective if the world of learning and the world of work are integrated. It’s not difficult to understand why. Skills that aren’t used can atrophy. And, compared to purely government-designed curricula taught exclusively in schools, learning in the workplace allows young people to develop “hard” skills on modern equipment and “soft” skills, such as teamwork, communication and negotiation, through real-world experience. Hands-on workplace training can also help to motivate disengaged youth to stay in or re-engage with the education system.

But building skills is the relatively easy part of the plan; far tougher is providing opportunities for young people to use their skills. Employers might need to offer greater flexibility in the workplace. Labour unions may need to reconsider their stance on rebalancing employment protection for permanent and temporary workers. Enterprises need reasonably long trial periods to enable employers giving those youth who lack work experience a chance to prove themselves and facilitate a transition to regular employment. And some countries may need to review the minimum wage for younger workers to make it easier for low-skilled young people to get their first job and discourage early school leaving by lowering the opportunity cost of staying on at school.

Last but not least, if all of this is about more than getting young people temporarily off the street, we need to ensure that talent is used effectively. Skills mismatch is a very real phenomenon that is mirrored in people’s earnings prospects and in their productivity. Knowing which skills are needed in the labour market and which educational pathways will get young people to where they want to be is essential. High-quality career guidance services, complemented with up-to-date information about labour-market prospects, can help young people make sound career choices.

We also need to maintain and expand the most effective active labour-market measures, such as counselling, job-search assistance and temporary hiring subsidies for low-skilled youth; and we need to link income support for young people to their active search for work and their engagement in measures to improve their employability.

But none of this is going to work unless everyone is involved: governments, which can design financial incentives and favourable tax policies; education systems, which can foster entrepreneurship as well as offer vocational training; employers, who can invest in learning; labour unions, which can ensure that investments in training are reflected in better-quality jobs and higher salaries; and individuals, who can take better advantage of learning opportunities and shoulder more of the financial burden. This week OECD will launch an Action Plan for Youth to be presented at the Organisation’s annual Ministerial Meeting in Paris in order to step up government’s efforts to tackle high youth unemployment and strengthen their education systems to better prepare young people for the world of work. It’s time for all of us to take the lessons we learned through the crisis and turn them into a sustainable plan to get our young people back on the path to prosperity.

Links:
OECD Forum 2013: Give youth a chance
skills.oecd: Working with youth
OECD Skills Strategy Spotlight: Apprenticeships and Workplace Learning
OECD Skills Strategy
OECD Survey of Adult Skills (PIAAC)
Photo credit: Young adult looking for work / Shutterstock

Earmarking Justice

by Justine Doody
Freelance Journalist and Editor, SGI News

In his State of the Union address on 12 February 2013, US President Barack Obama proposed a new initiative to improve access to high-quality early childhood education. The action is much needed: according to OECD figures from 2010, only 51 per cent of US children were enrolled in pre-primary education at age three, rising to 69 per cent at age four.

By comparison, in New Zealand, which became in 1986 the second country in the world to have its ministry of education take responsibility for early childhood education, 95 per cent of children in 2012 had been through an early childhood education programme before starting school at five years old.

Early childhood education is linked to improved prospects for future learning and employment. And, as the new Intergenerational Justice Index (IJI) study from the Bertelsmann Foundation's Sustainable Governance Indicators (SGI) project shows, it can help to level the playing field in terms of allocating resources fairly between older and younger generations.

As demographic changes lead to ageing populations in many OECD countries, the increased weight of older people in voting systems means they have more power than ever before to direct policy preferences. So, more than ever, it is important that countries take steps to ensure their policies provide future generations with at least the same chances that their parents and grandparents had.

Estonia Ranks Top, the United States Bottom

To find out which countries best provide for younger and future generations, SGI's Intergenerational Justice Index (IJI) measured OECD countries on several indicators: ecological footprint, child poverty, public debt per child and spending bias towards older generations.

The best performing country, SGI found, was Estonia, while New Zealand achieved a creditable fourth place. The United States ranked bottom of all the 29 countries studied, followed by Japan and Italy. If these countries do not change their current policy directions, their young people will grow up facing burdens of injustice, in terms of public debt, ecological degradation, and social immobility, that will be difficult, if not impossible, to overcome.

IJI offers policy recommendations that could help to shift the balance and help countries to improve their levels of intergenerational justice. The study suggests intergenerational earmarking as a way to rebalance public spending towards the young. Revenues raised in addressing one form of intergenerational justice, for example, environmental taxes, could be used to mitigate other areas of injustice, for instance by offering child tax credits or family allowances.

Proxy Votes for Children Could Foster Intergenerational Justice

Another interesting, albeit potentially controversial, recommendation is the introduction of proxy voting for children. Parents would be given the right to vote on behalf of their children, with a child's vote equalling one-half of an adult vote. In this way, children would be given a voice in politics, and parents would be rewarded for their societal contribution.

High-quality early childhood education is especially important. Research has found that children who participate in early childhood programmes are more likely to graduate from high school, hold down jobs, and earn more money. They are less likely to find themselves on state welfare or to go to prison.

The experience of high-quality early childhood education particularly benefits children from disadvantaged backgrounds, which means that providing early childhood programmes could work as a corrective social justice measure as well as an intergenerational rebalancing.

In New Zealand, beginning in 2007, three-year-olds were offered two free years of pre-school. Children attend programmes for 20 hours a week, 48 weeks of the year. The government hopes that by 2016, 98 per cent of children will receive early childhood education.

But despite this excellent record, there are concerns about the programme's future. Education unions complain that funding cuts are affecting the quality of early childhood education. Recently, the word 'free' was removed from the government strategy; now, almost half of early childhood education providers, hit by increasing costs and lower subsidies, are asking for extra fees from parents. Shifting costs onto parents could limit the availability of high-quality education for disadvantaged families.

Prospects for the US Seem Bleak

The US government says that in the United States, only 3 in 10 four-year-olds have access to high-quality early childhood education programmes. Socio-economically disadvantaged children are least likely to be in early childhood education programmes: just 59 per cent of the poorest US children are in pre-kindergarten, as compared to 90 per cent of children from wealthier homes. The president's programme is to implement free access to high-quality pre-school for all four-year-olds from families at or below 200 per cent of the poverty line.

To receive federal funding, states would have to meet strict requirements. All teachers must have a bachelor’s degree and be given access to on-going professional development. Teachers’ salaries should be comparable to those for teachers in higher levels of the education system. Class sizes should remain small and activities should cover the entire school day. Curricula should measure up to state standards and programmes must be continuously evaluated. As it stands, few states would be able to meet these strict standards and qualify for federal money.

However, it is unclear how the US programme would be financed. The president’s 2014 budget proposal includes a plan to pay for universal preschool by increasing taxes on cigarettes, which could have positive public health outcomes as well as providing a revenue stream for the programme. But even if the tax succeeded in getting past the vested interests that would oppose it, such “sin taxes” have diminishing returns over time, raising questions about future funding.

Any new federal funding is supposed to be matched by state funding. But because of budget constraints, many states have already cut funding for their existing early childhood education programmes, casting doubt on their willingness to provide more dollars for a new federal initiative.

And the larger, on-going struggle between those who wish to cut government spending in the name of austerity and those who favour Keynesian expansion seems to be resolving itself in favour of the budget-cutters.

So, even in the face of the overwhelming evidence that early childhood education has economic benefits that go beyond the moral claims of social and intergenerational justice, the future of the US initiative is uncertain. Absent new will to act from both sides of the US political divide, the prospects for the United States improving its dismal rating on intergenerational justice seem bleak.

Links
Find out more on OECD work on Early Childhood Education and Care
Education at a Glance 2012
Starting Strong; Starting Strong II; Starting Strong III
Doing Better for Families
Photo credit: Bulb idea with human hand / Shutterstock

Evolving attitudes towards early childhood education

by Barbara Ischinger
Director for Education and Skills

I was in Berlin recently to launch the German edition of Starting Strong III at an international conference on early childhood education and care and was struck by the difference in attitudes I found there compared to even a decade ago. Given the effects of the economic crisis and the ageing of European populations, more governments are realising that it is becoming unsustainable to continue to expect – and encourage – young mothers to stay at home with their children until the age of five or six, when primary school begins. Eight or nine years ago, Germany, to name just one country, hadn’t yet come to grips with the broader role that young mothers could play in society. The German Lander have come to agree with the federal government that as of August 1, 2013 all parents should have the right to enroll their children at the age of one.

Of course, early childhood education is not just about encouraging half of the adult population to enter the labour market; it’s about giving children a better chance to succeed later on. Results from PISA show that 15-year-old students who attended pre-primary education for more than one year score higher in the PISA reading test than their peers who did not attend. In Germany, for example, the difference between the two groups in reading performance in the 2009 assessment was the equivalent of one year of schooling, even after taking students’ socio-economic backgrounds into account.

That is, perhaps, the greatest benefit of high-quality pre-primary education: in theory, it gives all children equal opportunities to begin to develop their literacy, numeracy and social skills, regardless of their family’s income. If conceived with some imagination, these programmes can make an enormous difference in the lives of disadvantaged families. For example, New Zealand developed early education programmes, targeted to families with low levels of education, that include an adult-education component. In regions where these programmes are offered, enrolment of disadvantaged children – who benefit the most from these kinds of activities – has grown considerably.

Yet while participation rates in pre-primary education are rising, there are some worrying trends in how these programmes are financed and delivered. In OECD countries, more than 18% of total spending on pre-primary education (and more than 25% in Germany) comes from private sources – a far higher rate than for other levels of education. Since most of that money comes from households, it isn’t surprising that many people are concerned that access to early childhood education isn’t as equitable as it could and should be. And as any young parent trying to find a place for their child in one of these programmes knows, all programmes are not equal when it comes to quality. This is where Starting Strong III can help. It provides a toolkit for countries to use to improve the quality of their early childhood education programmes.

Over the next couple of years, the OECD will be working to define how to measure and assess the quality of the education provided in these programmes, which will be the first step towards ensuring that high-quality pre-primary education is available to all. In the meantime, I’m encouraged to see so many governments not only acknowledging the importance of early childhood education but making it a top priority on their agendas. It has taken a while, but I think we all now realise that high-quality pre-primary education is a public good that demands our critical attention and unstinting support.

Find out more on: OECD work on Early Childhood Education and Care
Photo credit: Small and colourful table and chairs for little kids / Shutterstock

The “urban advantage” in education

by Marilyn Achiron
Editor, Directorate for Education and Skills

Nearly half the world’s population now lives in urban areas. What does that mean for education? Results from PISA indicate that that could be good news for students who go to school in those areas. As the latest edition of PISA in Focus points out, an “urban advantage” in student performance is evident in nearly every country and economy that participated in the PISA 2009 assessment. 

PISA has shown that while large cities can be a challenge to educators, they are mostly a boon, particularly when all students can take advantage of the wealth of cultural and social opportunities that big cities offer. PISA results also show that schools in urban areas differ from schools in less-populated areas – in ways that are usually associated with better student performance.

On average across OECD countries, students who attend schools in cities of more than 100 000 people perform better in PISA than students who attend schools in villages, rural areas, or towns with up to 100 000 inhabitants. This difference in performance translates to about 20 PISA score points – the equivalent of half-a-year of schooling. In many countries and economies, the performance difference between the two groups of students reflects families’ decisions about housing and employment, which, in turn, influence how students’ socio-economic status is distributed geographically.

In all countries and economies except for Austria, Belgium, Germany, Israel, Korea, the Netherlands, the United Kingdom and the United States, students who attend schools in urban settings come from more advantaged socio-economic backgrounds. In Denmark, on the other hand, students whose parents have high levels of education and high-status occupations are more likely to attend schools in rural locations or in towns of up to 100 000 people. 

But the socio-economic status of students is only one of the factors that is associated with the better performance among students who attend school in cities. These schools have certain characteristics that PISA shows are positively related to performance. Urban schools are usually larger, enjoy greater responsibility for resource allocation, are less likely to experience staff shortages, are more likely to have a higher proportion of qualified teachers, and have higher student-teacher ratios than schools in rural areas and towns, especially in partner countries and economies.

An analysis of questionnaires distributed among students participating in PISA 2009 also finds that in Australia, Dubai (UAE), Estonia, Iceland, Israel, Montenegro, New Zealand, Qatar and Sweden, students who attend schools in urban areas tend to enjoy a better disciplinary climate in their classes than students who attend schools in less-populated areas (in Brazil, Mexico, Poland, the Slovak Republic, Slovenia and Tunisia, the opposite is true). In 15 countries, students who attend schools in urban settings are more likely to be able to choose from among a greater number and wider range of extracurricular activities.

What this tells us is that some of the conventional wisdom about big city schools may be a little off. Given the heterogeneity of the student population, large schools might actually offer students more, not less, stimulation and inspiration; and with more autonomy in allocating resources, urban schools may be better able to meet the needs of all their students.

Links:
For more information on PISA: www.oecd.org/pisa/
PISA in Focus No. 28: What makes urban schools different?

Photo credit: Urban Globe/ Shutterstock