Skills will drive inclusive economic growth in Portugal

by Andreas Schleicher

Director, Directorate for Education and Skills

Skills and human capital are the bedrock upon which Portugal is building a new bridge to growth.

Portugal is recovering from the most serious economic and financial crisis the country has experienced in recent history. The reform agenda over the past few years has been ambitious, comprehensive and challenging.

Awareness is now growing among policy makers, employers and households that Portugal’s future economic and social well-being will depend upon securing equitable and high-quality education and jobs while promoting innovation and entrepreneurship.

Portugal is on the road to recovery

Signs of Portugal’s recovery can be seen across the board. Youth unemployment and long-term joblessness rates are falling, even if levels remain too high. Job creation is picking up, and the majority of new jobs created in 2014 were on permanent contracts, which is a good indication that Portugal’s longstanding labour market dualism has been reduced by recent reforms. Educational attainment levels and learning outcomes are rising steadily, as reflected in Portugal’s PISA scores which now approach the OECD average. Measures have been introduced to stimulate entrepreneurship, and in 2014 Lisbon was selected as one of the European Entrepreneurial Regions (EER), in recognition of its strategies to promote entrepreneurship and spread innovation among small and medium enterprises (SMEs).

Building a shared diagnosis of Portugal’s skills challenges 

We know that in countries where a significant proportion of adults have poor skills, it is difficult to introduce productivity-enhancing technologies and new ways of working. This, in turn, stalls innovation and improvements in living standards.

Yet skills affect more than just earnings and employment. Data from the Survey of Adult Skills (PIAAC) show that in all countries, adults with lower literacy proficiency are far more likely than those with better literacy skills to report poor health, to perceive themselves as objects rather than actors in political processes, and to have less trust in others.

Put simply, a lack of proficiency in foundation skills prevents people from fully participating in society and democracy.

In the course of 2014, we have worked closely with Portugal on a collaborative project to build a more effective skills strategy. Throughout this initial diagnostic phase, we have witnessed strong commitment to improving Portugal’s skills outcomes across central and local governments, employers and trade unions, as well as education and training providers.

Today, the results of this work are published as the OECD Skills Strategy Diagnostic Report: Portugal. The Prime Minister of Portugal, Mr Pedro Passos Coelho, will be officially launching the report in Lisbon together with the OECD Secretary-General, Mr Ángel Gurría. This is a strong signal of the importance afforded to skills policies in Portugal.

Portugal’s 12 skills challenges

The diagnostic report applies the framework of the OECD Skills Strategy to identify 12 skills challenges for Portugal as it seeks to maximise its future skills potential. These skills challenges were distilled from a series of four interactive workshops held in Lisbon and Porto in 2014, which engaged a wide range of stakeholders. The report includes a rich set of evidence from OECD and other sources, and offers concrete examples of how other countries are tackling similar skills challenges.

So what are the main skills challenges facing Portugal today?

With regard to developing relevant skills, the report concludes that Portugal should focus its efforts on:
- Improving equity and quality in education
- Strengthening the responsiveness of VET to labour market demands
- Targeting adult education and lifelong learning towards the low-skilled

When it comes to activating its skills supply, Portugal will need to tackle the challenges of:
- Reducing youth unemployment and NEETs
- Increasing labour market re-entry for the long-term unemployed
- Reducing barriers to employment

Furthermore, Portugal could make more effective use of the skills it has by: 
- Promoting entrepreneurship
- Stimulating innovation and creating high-skilled jobs
- Providing employers with incentives to engage in skills development, especially SMEs

Finally, Portugal could improve the overall governance of the skills system by: 
- Financing a more equitable and efficient skills system
- Adjusting decision-making power to meet local needs
- Building capacity and partnerships for evidence-based skills policy

Moving from diagnosis to action 

Taken individually, these challenges may not be new or surprising to the people of Portugal. Yet by laying them out side by side, the need for a more systemic approach to skills policies emerges clearly.

As the diagnostic report demonstrates, skills policies are not just a matter for one ministry. Tackling skills challenges requires a whole of government approach. Moreover, skills are everybody’s business. Stakeholders and civil society need to play an active role in developing and implementing skills policies that are sustainable over the long term. 

By bringing together stakeholders, ministries and agencies to map out Portugal’s skills challenges, this project has built shared insights and deeper mutual understanding. The next step for Portugal will be to decide which challenges should be tackled as a priority and to develop concrete plans for action. This will mean building on the many reforms already underway and the continued engagement of all skills stakeholders.

Skills and human capital are the bridge to a more inclusive and prosperous future for the people of Portugal. The OECD stands ready to support Portugal as it designs and implements better skills policies for better jobs and better lives.

Links:
OECD Skills Strategy Diagnostic Report: Portugal 
OECDSkills Strategy
Survey of Adult Skills
For more on skills and skills policies around the world, visit: skills.oecd.org
See also the country page on skills for Portugal

Photo credit: The 25 de Abril bridge over Tagus river and big Christ monument in Lisbon at sunset, Portugal/ @Shutterstock 

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What the D in OECD stands for

by Barbara Ischinger
Director for Education

Did you know that the Organisation for Economic Co-operation and Development helped to lay the groundwork for the United Nations’ Millennium Development Goals? Even though Development is part of our name, there are many people who don’t realise just how much of our resources are devoted to developing economies and not only to the development of the OECD’s 34 member countries.

The focus of this year’s International Economic Forum on Africa, held at the OECD’s Paris headquarters in early October, was youth employment, but this issue cannot be separated from another one just as important:  education. The African Economic Outlook 2012 notes that in Egypt, for example, about 1.5 million young people are unemployed at the same time that private-sector firms cannot fill 600 000 vacancies. And in South Africa, there are 3 million young people who are neither in education nor employed and 600 000 unemployed university graduates, yet 800 000 jobs are vacant. At the Forum itself, I heard many participants ask themselves whether they were equipping their students with the skills their economies needed.

This is exactly where the OECD’s expertise in collecting and analysing data can help. Already, many of the countries and economies that participate in the OECD’s Programme for International Student Assessment (PISA) are in the developing world; but we think all countries would benefit from even greater participation by developing countries. By participating in PISA, countries can see whether the skills they are teaching their 15-year-olds are relevant to “real life”. They can also learn from other countries’ experiences how to improve their own education systems, and can benchmark their progress over time. The assessment, itself, benefits by gaining a deeper understanding of student performance in a broader range of countries and cultural contexts.

We have completed a review of Egypt’s system of higher education and have also reviewed the education systems of South Africa, Gabon and Mauritius. These in-depth analyses – conducted in close collaboration with local actors, regional organisations and other international partners – can guide countries in reforming their education policies so that students leave school with the skills needed to participate productively in the economy. We also stand ready to work with our partners – in Africa and elsewhere – to build stronger links between labour markets and education systems. That would help to avoid the situation, seen in so many countries, where universities train students to become civil servants when what the country or region really needs are engineers and health workers – and also people with the mid-level trade, technical and professional skills that can be acquired through well-designed vocational programmes. At the moment, vocational education accounts for only 5% of training among African youth.

As the 2015 target date for achieving the Millennium Development Goals approaches, the international community has begun to consider a framework for goals beyond 2015. For the first set of goals, progress in education is measured by access; I hope that future goals will complement such measures by looking at learning outcomes. Again, this is one of the OECD’s specialties, and we’re keen to offer our work and expertise to an even larger number of countries. I thought you’d want to know.

Links:
OECD Development home page
The OECD and the Millennium Development Goals
OECD Strategy on Development
The OECD Strategy on Development: Giving fresh impetus to a core mission
2012 International Economic Forum on Africa
OECD Skills Strategy
Photo credit: Orphan students in Swaziland / Shutterstock

Investing in people, skills and education for inclusive growth and jobs

by J.D. LaRock
Senior Analyst, Innovation and Measuring Progress Division, Directorate for Education

As the spectre of another economic downturn looms large in many countries and is already a reality in others, new data from the 2012 edition of Education at a Glance: OECD Indicators – released today – provides powerful insights into the link between education, economic progress and social mobility around the world.

For example, as detailed in the book’s new indicator on education and economic growth, more than half of the GDP growth in OECD countries over the past decade is related to labour-income growth among workers with higher education.  Indeed, even as GDP across all OECD countries shrank by 3.8% during the global recession year of 2009, growth in labour income among people with higher education contributed nearly 0.4% to the GDP of these countries overall. In contrast, the contraction of labour income that year among people with a medium level of education reduced the GDP by 0.8%, while shrinking incomes among people with lower levels of education trimmed another 0.5% off GDP.

In light of the substantial role education can play in promoting economic growth, countries’ success in assuring that younger people achieve a higher level of education than their parents – what is known as intergenerational mobility in education – is especially important. The new indicator on educational mobility in this year’s Education at a Glance shows that many countries are making good progress in this regard.  On average across all OECD countries, 37% of 25-34 year-old non-students have surpassed their parents’ level of education, while only 13% have achieved a lower level.  Half of younger adults in OECD countries have achieved the same level of education as their parents: 13%, a low level of education; 21%, a medium level, and 16%, a high level.

Meanwhile, as detailed in the new indicator on early childhood education, many OECD countries are working hard to expand schooling opportunities for their youngest children. For example, among OECD countries with data for both years, 81% of four-year-olds were enrolled in early childhood programmes in 2010, up from 77% in 2005.  What’s more, enrolments among three-year-olds rose from 64% to 69% during this same period. Since participation in early childhood education is linked to better performance later on in school, these developments bode well for a future in which improving young people’s skills will be more important than ever.

At the same time, this year’s Education at a Glance also shows that many OECD countries need to address the growing problem of youth who are not in employment, education or training. After several years of decline, the so-called “NEET” population began to rise in 2009 and spiked to nearly 16.0% in 2010 – a sign of the particular hardship young people have borne as a result of the global recession. As such, OECD countries would do well to examine measures that can productively engage people in this crucial age group, such as vocational education and training programmes and opportunities for non-formal education and training.

As always, the 2012 edition of Education at a Glance contains a rich array of indicators on educational attainment, graduation and completion, education financing, enrolment trends and the globalisation of higher education, and schools and teachers. In addition to the data discussed above, this year’s edition contains a number of other new indicators, including information on how the career aspirations of boys and girls compare to the fields young men and women study in higher education ; the factors that influence immigrant students’ performance in school ; who makes key decisions in education systems ; and the pathways and gateways to gain access to secondary and tertiary education.

For more information, and to download a copy of the book, visit the Education at a Glance website at: www.oecd.org/edu/eag2012
Browse and share the book
Education at a Glance Highlights
Watch the video interview with Andreas Schleicher
Photo credit: Digital Vision/Inmagine