The sustainability of the UK’s higher education system

by Andreas Schleicher

Director, Directorate for Education and Skills

Skills have become the currency of 21st century economies and, despite the significant increase the UK has seen in university graduation over the last decade, the earnings of workers with a university degree remain over 80% higher than those of workers with just five good GCSE’s or an equivalent vocational qualification. Sure, not every university graduate will end up with a great salary, but on average they take an additional
£160 000 home over their working life, and that's even after discounting tuition, forgone earnings, and the higher tax bill that comes with a better salary. Some say these trends are all futures of the past, and that the job prospects of future graduates may look much worse, particularly if bringing in more and more people eventually means including less qualified applicants. But people have been saying these things ever since I began tracking those numbers over a decade ago and the bottom line is that, so far, the rise in knowledge workers has not led to a decline in their pay, as we have seen for people at the lower end of the skills spectrum.

That brings up the question of who should pay for this, because there simply is no free university education.

The Nordic countries pay for universities through the public purse and even subsidise the living costs of university students. It makes sense for them because participation is almost universal and they have a steeply progressive tax system so that they can recuperate the funds from graduates who typically end up as the better earners.

European countries like France, Germany or Spain, too, say higher education is important, but their governments are neither willing to put in the required funds nor allowing universities to charge tuition. They end up compromising quality and restricting access, with the effect that all workers end up paying for the university education of the rich parents’ children.

The third alternative is to allow universities to charge tuition, and interestingly, OECD data show absolutely no cross-country relationship between the level of tuition countries charge and the participation of disadvantaged youth in tertiary education. In fact, social mobility is worse in Germany which pays for all university education through the public purse than it is in the UK.

But getting tuition right is not simple either. If countries put the burden for tuition entirely on the shoulders of families, they risk not attracting the brightest but the wealthiest children to attend, which means not making the most out of the country’s talent.

If countries rely mainly on commercial loans which students have to repay once they finish their studies, they still leave students and families with the risk, because the promise of greater lifetime earnings of graduates is a statistical one, and there is actually very wide dispersion in earnings. The UK, and some other countries too, have tried to square that circle with a combination of income-contingent loans and means-tested grants. That basically means risk-free access to financing for prospective students with governments leveraging, but not paying, for the costs.

The loans reduce the liquidity constraints faced by individuals at the time of study, while the income-contingent nature of the loans system addresses the risk and uncertainty faced by individuals (insurance against inability to repay) and improves the progressiveness of the overall system (lower public subsidy for graduates with higher private returns). In the UK, the repayments of graduates correspond to a proportion of their earnings and low earners make low or no repayments, and graduates with low lifetime earnings end up not repaying their loans in full.

But even the best loan system is often not sufficient. There is ample evidence that youth from low income families or from families with poorly educated parents, but also youth who just don't have good information on the benefits of tertiary education, underestimate the net benefits of tertiary education. That’s why it has paid off for the UK to complement the loan scheme with means-tested grants or tuition waivers for vulnerable groups.

Sure, those loan and grant systems cost money, and have shifted risks to government which will end up paying for any bad debt. Indeed, it is very likely that repayment rates will end up a lot lower than what the government anticipated. But these costs are just a tiny fraction of the added fiscal income due to better educated individuals paying higher taxes. Keep in mind that the added tax income of those graduates who end up in employment, on average over £80 000 in the UK, is many times larger than any conceivable bad debt.

There is lots the UK can do to further improve its approach to financing universities. For a start, it can do better with aligning course offerings with societal demand. I also worry that the loan repayment parameters mean many middle income workers – such as teachers, health professionals, public sector workers - will end up paying more for their education than better earners such as lawyers and bankers. But among all available approaches, the UK offers still the most scalable and sustainable approach to university finance.

This article originally appeared on the Research Professional website, International Comparison of Tuition Fee regimes.

Links:
Education at a Glance 2014 country note: United Kingdom
Education at a Glance 2014: OECD Indicators (See Indicator B)
Better Skills, Better Jobs, Better Lives: A Strategic Approach to Skills Policies

Photo credit: Students pulling and pushing heavy stone / @Shutterstock

Are university students taking less time to graduate?

by Dirk Van Damme
Head of the Innovation and Measuring Progress division, Directorate for Education and Skills

University is both a formative and enjoyable period in a young person’s life. Some who can afford to postpone their entry into the job market like it so much that they spend many years studying for a degree. Others have to repeat courses and semesters to succeed. Traditionally university programmes are designed as long and demanding trajectories, especially within Europe. In a paradigm of higher education, oriented towards the selection of the future elite, the length of study in itself works as a selection tool.

With massification of higher education from the 1970s onwards, as well as changes in the purpose and social functions of universities, the length of study became a policy issue. Each year of an individual’s study required  a significant public investment, therefore the time spent acquiring a degree became a budgetary concern. Moreover, time spent at colleges and universities was increasingly seen as an inappropriate mechanism of social selection, favouring those who had the resources to spend their young lives studying and punishing those unable to postpone earning a salary for too long. Additionally, demographic challenges increased the need to raise the activity rate in the population, and the need to recruit  young people for the job market sooner. Consequently, governments started to develop policies to shorten the length of study, shift some of the financial burden to students, and provide universities with the incentives for shorter study programmes.

By the time the Sorbonne and Bologna Declarations were discussed and approved, in 1998 and 1999 respectively, this policy challenge had become very real. In at least two of the signatory countries of the Sorbonne Declaration – Germany and Italy – studying until the age of 28 was the rule, not the exception. Ministers were very interested in the Anglo-Saxon qualification structure, because it would allow them to break up very long study programmes and stimulate students to acquire a first degree after only three or four years of study. Next to the objectives of having more comparable degree and credit systems and fostering mobility, the Bologna Declaration also intended to shorten study trajectories.

Data presented in the latest issue of the Education Indicators in Focus series allows us to evaluate the changes in the length of study careers, at least up until graduation with a first degree. Comparing OECD countries with available data, we learn that the median age of graduation decreased from 25.2 in 2005, to 25.0 in 2008 and down to 24.7 in 2011. This means that in 2011 the median student graduated half a year earlier than in 2005. The decrease differs across the age distribution: it is less significant for students graduating at a younger age, but it is very significant among students graduating at a higher age. The age of graduation at percentile 75 dropped from 28.7 in 2005 to 27.9 in 2011. Thus the share of students who took many years to graduate dropped significantly.

Students also entered universities at a slightly younger age, but the earlier age of graduation is predominantly determined by shortening the time spent acquiring a first degree. Between 2005 and 2011, the time taken to acquire a first degree fell by almost half a year, from 4.6 years to 4.2 years. Of course, many students pursue their studies beyond a first degree, but the combined effect of shorter study programmes and more effective study trajectories is quite significant.

These average changes conceal huge variations across countries. In some countries, the decrease in the median age of graduation between 2005 and 2011 is very marked. In Belgium, Denmark, Iceland, Norway, Portugal and Slovenia, the median age fell by more than one year between 2005 and 2011. Despite the general trend, in some countries including Austria, Israel, Spain and Turkey, the median age of graduation actually increased during the same time frame. . Various institutional factors and participation patterns might explain these differences, but the socio-economic context should also be taken into account. For example, huge youth unemployment in Spain probably played a role in keeping students longer at university in 2011 compared to 2008.

The average decrease in the age of graduation, especially in countries where youth was less affected by the economic crisis and the job market still offered prospects for earning a living, might also be explained by composition effects. Students coming from less affluent families tend to have shorter studypaths, because they cannot afford to postpone earning a salary fortoo long. In several countries this is also noticeable in the increase of the number of students studying part-time. Flexible work-study arrangements allow students to combine study with work. When the economic crisis erupted in 2008, on average 19.6% of students studied part-time; in 2011 this number had  risen to 22.0%. The increase was very significant in again, Spain (from 12.2% to 27.1%), Germany (4.5% to 13.5%), Belgium (12.6% to 17.3%) and Canada (17.7% to 22.8%). Credit-systems and increased flexibility in study arrangements have provided more opportunities for part-time study and combined study-work trajectories. Of course, having more part-time students works against having a lower median age of graduation.

Today a first university degree – in most cases a bachelor’s degree – takes less time to acquire than in the past. Pressures on students to graduate faster have increased, both as a result of government policies, institutions’ actions to improve quality and efficiency and the general socio-economic context. University might be less leisurely, but on-campus life, learning soft skills such as making friends and forming social networks, is still an essential part of nurturing successful study.

Links:
Education Indicators in Focus, Issue No. 23, by Dirk Van Damme and Corinne Heckmann
On this topic, visit:
Education Indicators in Focus: www.oecd.org/education/indicators
On the OECD’s education indicators, visit:
Education at a Glance 2013: OECD Indicators: www.oecd.org/edu/eag.htm
Chart source: © OECD

Education: The best protection against an economic crisis

by Dirk Van Damme
Head of the Innovation and Measuring Progress division, Directorate for Education and Skills

The insight that education is valuable both to individuals and to countries is not new. Using continuously improving data and statistical tools, we have come to understand and appreciate the magnitude of education’s impact on employment, income, health and life opportunities in general. From a purely economic point of view, private returns on investment are well beyond 10% per year, and public returns are only slightly below that figure. Fears that increasing participation and greater numbers of graduates – resulting in ever-increasing numbers of highly qualified people in the work force – would result in some kind of inflation, in diminishing returns and burgeoning graduate unemployment could not be confirmed by the data.

When the financial crisis erupted in 2007-08, rapidly turning into a global economic recession and a fiscal crisis in the Euro-zone and other countries, it was very difficult to predict its impact on education. Data for the years 2008 and 2009 showed that in the first years of the crisis, the impact on education remained limited and was confined to countries in severe crisis, such as Ireland, Iceland and Greece. Education is generally protected from shocks to the economic system because of its intrinsic slow pace of change. Individuals and families did not drastically alter their patterns of participation in education; and in the first years of the crisis, governments used stimulus packages and deficit spending to try to soften the blow, leaving education budgets more or less untouched. But we know that things started to change dramatically from 2010 onwards, when unemployment – especially among youth – climbed steeply and governments turned into austerity mode.

Education at a Glance 2013, the OECD’s reference on education indicators and statistics, for the first time provides a comprehensive set of data covering the years 2010 and 2011. The data convey a consistent, but also somewhat surprising picture. A great deal of the economic and social hardship caused by the crisis fell chiefly on less-educated individuals. The unemployment gap between well-educated young people and those who left school early widened during the crisis. On average across OECD countries, 5% of those with a tertiary education were unemployed, against 13% of those without an upper secondary education. Between 2008 and 2011 the unemployment rate for the latter group increased by 4%, while it rose by only 1.5% among the highly educated. The earnings gap widened as well: the average difference in earnings between highly educated and low-educated individuals grew from 75 percentage points to 90 percentage points between 2008 and 2011.

The message is clear: it is a person’s education that determines whether he or she will be extremely or only moderately exposed to the economic and social risks in times of crisis. Those without a minimal level of education, and certainly those of them without a stable job, find themselves without any shelter from the storm. Meanwhile, the relative returns on higher education increase. Some might argue that this is largely due to structural changes in the labour market: highly educated people taking the jobs of the middle-educated individuals, who, in turn, drive low-educated workers into unemployment. The earnings data do not seem to confirm this hypothesis: if tertiary-educated individuals were to take medium-skilled jobs en masse, their relative wage premium would not have increased as much as it did. In addition, the wage premium increases with age, which suggests that the higher level of skills among tertiary-educated workers is compensated in their salaries. In times of crisis and tough competition in the labour market, employers would certainly not be willing to value skills as much as they seem to do if there was no good reason to.

In short, the value of education increases during an economic crisis. Those who lack education, stand to lose a lot; those who have invested in it, can still reap its benefits.

Links:
For more information, and to download a copy of the book, visit the Education at a Glance website at: www.oecd.org/edu/eag.htm

Browse and share the book

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

Skills for the digital economy

by Simone Stelten
Consultant, Skills Beyond Schools Division, Directorate for Education and Skills

Digital economies are powered by skills. People with the high-end skills needed to invent and apply new technologies are in high demand the world over. At the same time, the portfolio of basic skills needed to navigate technology-rich environments and function effectively in our connected societies has expanded.

How severe is the shortage of ICT skills? And what needs to be done to fill the gaps?

Today, 6% of total employment in OECD countries consists of ICT-specialists and ICT-intensive occupations account for more than 20% of all employment. OECD data on Key ICT Indicators shows that countries differ considerably in the share of ICT-intensive employment, ranging from high levels such as 35% in Luxembourg or 28% in the UK to 15% in Portugal and Greece or 11% in Turkey (data for 2010). Growing skills shortages have become a global concern. The Manpower Talent Shortage Survey 2012 puts IT positions at number 5 on the global list of top 10 jobs that employers are having difficulty filling. Only three years ago, IT professionals did not even feature on this list.

Across the OECD the supply of higher education graduates from ICT-related study fields has stagnated or even declined. The share of all STEM (science, technology, engineering and mathematics) graduates declined from 22.7% in 2000 to 20.4% in 2010, indicating a long-term stagnation of the supply from highly demanded science and technology oriented fields. The share of computer science graduates among all graduates has stagnated at around 3% since 2000 (OECD data). Even in the United States, the homeland of computers, the share of computing graduates declined from 4.3% in 2005 to 3.1% in 2010. Similar declines in recent years can be observed in many other countries, including the UK and Germany, pointing towards a risk of ICT skills shortages in many OECD countries.

So what can employers do to fill the skills gap? The study “Building Competitiveness and Business Performance with ICT” from the business school INSEAD shows that firms, which operate in the ICT sector, need to combine the right ICT investments with strong technical talent to be competitively agile. Through the Grand Coalition for Digital Jobs employers have developed EU-wide initiatives, such as an online learning platform for ICT practitioners or open online ICT courses for secondary school teachers. Companies such as SAP set up study-programs, Microsoft will increase the number of apprenticeships and internships by 50% over 3 years, and Hewlett-Packard plans to train 500,000 IT-professionals globally by 2015. Clearly, government policy makers could do more to engage employers in meeting the skills challenges facing high value-added sectors.

What about ‘everyday ICT skills’? Survival in a digital economy now demands higher-level cognitive skills for understanding, interpreting, analysing and communicating complex information. The results of the OECD Survey of Adult Skills (PIAAC), to be published on 8 October 2013, will provide unique comparative data on the basic skills of adults in literacy, numeracy and problem solving in technology-rich environments. How to foster those skills effectively is the subject of another recent OECD report on Connected Minds: Technology and Today's Learners.

Tackling the ICT skills challenge will require new thinking and efforts to reach beyond ministerial silos and build partnerships with businesses, entrepreneurs and teachers. With its ‘whole-of-government’ approach to developing more effective national skills strategies, the OECD Skills Strategy offers a concrete roadmap for the future.

Links:
OECD Skills Strategy
OECD Survey of Adult Skills (PIAAC)
OECD data on Key ICT Indicators
Connected Minds: Technology and Today's Learner
Photo credit: Future technology / Shutterstock

A Women’s Day Challenge

by Barbara Ischinger
Director for Education and Skills

On a recent visit to New Zealand, I attended a memorial service for the 185 people who lost their lives when the earthquake of 22 February 2011 struck Christchurch. What I took away from that gathering was less the still-fresh grief but rather the sense of purpose that followed the tragedy. Kay Giles, chief executive of Christchurch Polytechnic Institute of Technology (CPIT), for example, who was already devoted to assisting young people – most of them boys – who had dropped out of the education system, put her passion and expertise to work by calling on people involved in apprenticeship programmes to help those who had lost their livelihoods to the earthquake. Stakeholders from local businesses, industry and education worked together quickly to develop long- and short-term training modules to put people back to work – sometimes in entirely different careers – as soon as possible.

I met, too, with New Zealand’s Education Minister, Hekia Parata, who is part Maori, and a vocal champion of indigenous culture and rights. She told me she is particularly concerned about Maori boys who are increasingly falling out of the education system and, in doing so, are dooming themselves to a very uncertain future.

On this International Women’s Day I’d like to be just a bit provocative and suggest that we start paying a little more attention to boys. Boys are getting lost in today’s life and we don’t really understand why. A recent study finds that boys’ behaviour costs them dearly in school marks (our next PISA in Focus, due out on 14 March, has a few other interesting things to say about how teachers award marks to girls and boys); and a school in Shanghai, China – which was the best-performing school system in the 2009 PISA survey  – has just introduced boys-only classes  in an effort to turn around the decline in boys’ performance in university entrance exams. (I was interested to read that some of the boys interviewed said that they felt shy answering teachers’ questions in front of girls. Didn’t many girls used to say that the presence of boys made them reluctant to participate in class?)

How do we make sure that our education systems – and labour markets – are equitable, and create good opportunities for both boys and girls?

We have done a lot for girls, and we see the positive results of this in everyday life. Girls are, on average, doing better in school than boys, and more women now graduate from university-level education than men. Of course, there is still a lot of room for improvement: just look at the salaries of women versus those of men. And I am irritated when I attend board meetings in the private sector and note that women are still a minority.

So we must not look at the great strides girls and women have made in recent decades and think that the battle is won. But I would also add: We don’t gain much if we gain on one side and lose on the other.

Am I focusing too much on boys on what is supposed to be the day we celebrate the girls and women of the world? I don’t think so. It’s all about empowerment: having equal opportunities to realise our individual potential. And that is something that should not be gender-specific.

Links:
OECD work on Gender: www.oecd.org/gender and www.oecd.org/gender/data for data on International Women's Day
OECD Feature: Growing more equal
OECD Insights: Born a girl: bad karma?
For more information on PISA: www.oecd.org/pisa/
Photo credit: Boy with apple on head in classroom / Shutterstock

What do students expect to do after finishing upper secondary school?

by Guillermo Montt
Analyst, Directorate for Education

The expansion of the knowledge-based economy and technological progress has created a large market of highly paid jobs for individuals who are highly skilled. Moreover, in much of the industrialised world, the demand for highly-skilled individuals is rising faster than supply, as mirrored in rising wage premia on university-level qualifications. Leveraging the talent of all individuals, whatever their social background, must therefore be an important goal for educators and policy makers alike.

The latest edition of PISA in Focus summarises findings from the PISA Report Grade Expectations: How Marks and Education Policies Shape Students’ Ambitions. PISA reveals that the range of educational expectations that students hold in different countries striking: In Korea, four out of five 15-year-olds expect to graduate from university, while in Latvia it is one out of four. Despite the major changes in skill requirements that most labour-markets experienced in the past decades, and the rapidly rising number of university graduates, the educational expectations of students in school have remained surprisingly stable.

In all countries and economies, the students who expect to complete university education perform significantly better in math and reading than students who do not expect to complete that level of education.  However, while performance on PISA tends to be associated with educational expectations, the data also show that not all 15-year-olds with advanced knowledge and skills aspire to high levels of further education and not all 15-year-olds who aspire to a university degree possess the knowledge and skills needed to pursue such pathways successfully.

The percentage of low-performing students who expect to complete a university degree is relatively high in Australia, Ireland, Korea, Mexico, Serbia, Singapore and Trinidad and Tobago. These school systems therefore need to capitalise on their students’ desire to continue their education by encouraging greater engagement with school and offering better opportunities to learn so that low-achieving, but ambitious, students can improve their performance and have a better chance of succeeding. The proportion of high-performing students who do not expect to continue on to post-secondary education is relatively large – more than 10% – in Austria, Hong Kong-China, Iceland and Italy. These school systems should aim to raise their students’ expectations by, among other measures, enhancing engagement with school and ensuring that placement in academic or vocational programmes is based on merit, not on students’ background. Mismatches between expectations and actual abilities can result not just in personal disappointments but also incur important economic and social costs.

Students who hold ambitious – yet realistic – expectations about their educational prospects are more likely to put effort into their learning and make better use of the educational opportunities available to them to achieve their goals. Therefore educational expectations, in part, become self-fulfilling prophecies. Education systems need to strike a careful balance between promoting ambitious expectations among students – because the labour-market demand for high-level skills is surging and will probably continue to grow in the future – promoting skill acquisition so that more students are able to fulfil those expectations but also not neglecting those students who expect to complete their studies upon graduation from secondary school. Although most school systems are committed to expanding access to tertiary education, around 25% of students expect to finish their formal education at the end of upper secondary school. Education systems must provide these students with the skills needed for a smooth transition into the labour market and adulthood.


Links:

For more information on PISA: www.oecd.org/pisa/

PISA in Focus No. 23: What do students expect to do after finishing upper secondary school?

Photo credit:  Graduate wordcloud / Shutterstock

Taking stock of education and skills: the youth perspective

With his vantage point at the helm of the largest youth platform in the world, European Youth Forum (YFJ) President Peter Matjašič is well placed to assess the state of education and skills across Europe. Indeed, the YFJ represents millions of young people by way of national councils from Iceland to Azerbaijan, lobbying such important international bodies as the European Union, the Council of Europe and the United Nations to adopt policies that are in the best interests of European youth.

Educationtoday met with him at the OECD Forum to get his views on the state of young people's education and skills across the continent today.

educationtoday: How can today's students and young workers prepare themselves for rapidly evolving labour markets? 

Peter  Matjašič: The YFJ has been working on education since its inception fifteen years ago, focusing on quality and equality of access. We have a holistic view of education. Formal education must be supplemented by non-formal education, by which I mean you still have an organised activity, but one that is not organised by universities or colleges but by youth organisations, for example. Plus informal learning, which is what you gain from life experience.

Education is not necessarily enough. What we strive for is what we call youth autonomy. And to make the transition to the labour market, there are certain tools, such as internships.

The Youth Guarantee is another measure to ensure no young people are out of employment, school or training for more than four months. It means there are public programmes that ensure young people can get an internship or be retrained.

educationtoday: How do you ensure companies don't simply use internships as a means to get skilled young workers at little cost? 

Matjašič: First of all, for us it was important to put things into perspective. To do this, we carried out a survey of 4 000 interns across Europe last summer. We found the majority of interns enjoy being an intern, but at the same time they are aware of their precarious status. So, internships can be good tools if they're managed properly. For example, interns should be paid at least the minimum wage of the country they work in. To ensure this, we developed the European Quality Charter On Internships and Apprenticeships and pushed EU policymakers to propose it. The commission picked it up and will present a proposal themselves.

educationtoday: You mentioned entrepreneurship. This involves a certain measure of independent-mindedness and creativity. How do you think schools can better equip young people with these qualities?

Matjašič: The so-called life skills, or soft skills, are not being acquired through education. The value of peer-to-peer education you get in youth organisations is immense. Education needs to be hands-on with analytical thinking, which tends to be more the case in Northern Europe, whereas in Southern Europe teaching is often more ex-cathedra, where students simply learn what the teacher tells them. And this model in times of crisis fails young people in that studying hard is no longer enough to get a job.

I would also add that the way society sees entrepreneurship needs to be changed. Today, too many young people see it as solely about profit.

educationtoday: To what extent do you feel there is a skills mismatch today in Europe? 

Matjašič: The problem is in part because there's a disconnect between education and jobs. But at the same time, we aim to foster autonomous and active citizens. We don't want young people to be told, for example, they have to study mechanics because that's where jobs are. They need to be informed to make the right decisions. Proper career orientation in schools is key.

educationtoday:  Do you think there is a problem of over-skilled or over-educated young people today?

Matjašič: From a technical perspective, in terms of the level of education they have, yes. However, if you look at the actual knowledge young people have, I have my doubts as to whether they're over-skilled. They're definitely over-educated for certain things. But I would say it's more up to the individual today. People feel they need a master's degree because a bachelor's is not good enough anymore, so you have a proliferation of degrees, which makes them less valuable. The knowledge is no longer the focus, and I see this as a danger. We don't want education to just be a tool to enter the labour market

educationtoday: What can be done to ensure young people today have a broad education that allows them to be active citizens? 

Matjašič: Non-formal education, informal learning and volunteering need to be recognized. People can then have specific knowledge from formal education and life skills from youth organisations, for example. Interdisciplinary approaches are also important.

Links:
European Youth Forum
OECD Skills Strategy
OECD Forum 2012
Photo credit: OECD Video Invest in skills to boost jobs and growth

It all starts with building the right skills

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

Skills transform lives and drive economies. Without the right skills, people are kept on the margins of society, technological progress does not translate into economic growth, and countries can’t compete in today’s economies. But the toxic co-existence of unemployed graduates and employers who say that they cannot find the people with the skills they need, shows that skills don't automatically translate into better economic and social outcomes. The OECD has put together a strategy that helps countries transform skills into better jobs and better lives.

It all starts with building the right skills. Anticipating the evolution of the demand for labour is the essential starting point. We then need to improve the quality of learning outcomes, by putting a premium on skills-oriented learning throughout life instead of qualifications-focused education upfront. That’s about fostering relevant learning. Skills development is far more effective if the world of learning and the world of work are linked. 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 education and smooth the transition to work. Data from our new Adult Skills Survey (PIAAC) provide powerful evidence of that. While you learn when you are in education between the ages of 16 and 25, the learning curve is even steeper if you combine education with work.

All of this is everybody’s business; and we need to deal with the tough question of who should pay for what, when and how, particularly for learning beyond school. Social partners can help in developing curricula that include broader, transferable skills and ensuring that good-quality training is available to all. Employers can do a lot more to create a climate that supports learning, and invest in it. Some individuals can shoulder more of the financial burden. And governments can do a lot to design rigorous standards, provide financial incentives and create a safety net so that all people have access to high quality learning.

But even the best skills simply evaporate if they aren’t maintained and upgraded to meet the changing needs of societies. There are people who are highly skilled who have decided not to work. Why? They may be too busy caring for children or elderly parents; they may have health problems; or they may have calculated that it just doesn’t pay to work. The answer is that we need to make better use of our talent pool.

Equally important, we need to ensure that skills are used effectively at work. OECD data show the link between how skills are used on the job and people’s earnings prospects and productivity. If you have great skills and have a demanding job, you’re fine, and your earnings continue to increase. If you don't yet have the skills but your job is demanding, you’ll see progress too. But if your employer does not use your skills, the earnings over your lifetime tend to deteriorate.

So what can we do about this? Quality career guidance is essential. People who have the latest labour-market information can help steer individuals to the education or training that would best prepare them for their prospective careers. Helping young people to gain a foothold in the labour market is fundamental too. Vocational training is a very effective way to achieve this. Coherent and easy-to-understand qualifications help employers identify potential employees who are suitable for the jobs they offer. And reducing the costs of moving within a country can help employees to find the jobs that match their skills and help employers to find the skills that match their jobs.

There may be young people just starting out who are well educated but have trouble finding jobs that put their education and training to good use. What most people don’t realise is that we can shape the demand for skills. Often we think that the demand for skills is as it is, and we just need to educate people to meet existing demand. That is a big mistake. There is much that governments and employers can to do promote knowledge-intensive industries and jobs that require high-skilled workers. Adding these kinds of high value-added jobs to a labour market helps to get more people working—and for better pay.

Last but not least, education that fosters entrepreneurship can help create jobs. Indeed, education is where entrepreneurship is often born.

In short, we’re all in this together – and there’s a lot more that we all can do to develop the right skills and turn them into better jobs and better lives.

Links:
To download the report:  Better Skills, Better Jobs, Better Lives: The OECD Skills Strategy   – and much find out more about skills and skills policies around the world – visit our interactive skills web portal: http://skills.oecd.org

Follow the launch of the Skills Strategy and join the debates on @OECD_Edu and @SchleicherEdu #OECDSkills

Women’s outcomes in education and employment: strong gains, but more to do

by Éric Charbonnier and Corinne Heckmann
Innovation and Measuring Progress Division, Directorate for Education

There’s no denying it: when it comes to education and employment, women are on a roll, all over the world.  As described in the latest issue of the OECD’s new brief series Education Indicators in Focus, the achievement gap between boys and girls has narrowed so much at lower levels of education that the focus of concern is now on the underachievement of boys.  On the 2009 PISA reading assessment, for example, 15-year-old girls outperformed boys in every OECD country, on average by 39 points – the equivalent of one year of school.

Young women are also making strong progress in higher education in OECD countries.  In 2000, 51% percent of women could be expected to enter a university-level programme at some point in their lives; today, the number is 66%.  In fact, the proportion of women who hold a university-level qualification now equals or exceeds that of men in 29 of the 32 OECD countries for which data are comparable. This figure is below 50% only in China, Japan, Korea and Turkey.

At the same time, still more can be done to improve outcomes for girls and young women in the classroom.  In mathematics, for example, 15-year-old boys tend to perform slightly better than girls in most countries, while science performance is more variable.  And in higher education, women remain under-represented at the most advanced levels.  Across all OECD countries, less than half of advanced research qualifications such as doctorates were awarded to women in 2009.  In Japan and Korea, the figure is only around 30%.  This pattern holds in all countries except Brazil, Finland, Iceland, New Zealand, Poland, Portugal and the United States.

In addition, some fields of study are still branded as “masculine” or “feminine”. In 2009, more than 70% of higher education students in the field of education were women, and an average of 75% of the degrees in the fields of health and welfare also went to women. By contrast, in most countries, fewer than 30% of all graduates in the fields of engineering, manufacturing and construction were women.

Nonetheless, women’s strides in education have led to improved labour market outcomes for women overall. For instance, the gender gap in employment narrowed from 25 percentage points in 2000 to 21 percentage points in 2009 among those without an upper secondary qualification, and from 19 percentage points in 2000 to 15 percentage points in 2009 among those with an upper secondary qualification. And it’s narrower still among those with a higher education qualification, shrinking from 11 percentage points in 2000 to 9 percentage points in 2009.

Increasingly, OECD countries are doing more to address gender gaps – both in education and employment.  For example, in the Czech Republic, Germany and the Slovak Republic, the proportion of women graduating with science degrees grew by more than 10 percentage points between 2000 and 2009.  As a result, these countries are now closer to the OECD average of 40% -- a figure that has remained stable over the past decade. In 2000, the European Union announced a goal to increase the number of university graduates in mathematics, science and technology by at least 15% by 2010, and to reduce the gender imbalance in these subjects. So far, however, progress toward this goal has been marginal.

On the employment side, the Nordic countries, Germany and Portugal have instituted policies allowing fathers to receive parental leave and income support so their spouses can remain in the workforce.  In Iceland, Norway and Spain, some firms are required to have at least 40% of their boardroom seats assigned to women. Meanwhile, other companies, such as Deutsche Telekom, have introduced voluntary quotas for women in management and family-friendly practices such as flex-times and tele-working.

The bottom line is clear: while girls and women have made strong gains, it’s time to finish the job.  To promote gender equality even further, policymakers should be encouraged to pursue policies to increase mathematics and science performance among girls – as well as reading achievement among boys.  Meanwhile, initiatives to break down gender stereotypes in fields of study and progressive corporate policies can do more to increase women’s employment opportunities.

For more information
On this topic, visit:
Education Indicators in Focus
OECD Gender Initiative
www.oecd.org/gender/equality
On the OECD’s education indicators, visit:
Education at a Glance 2011: OECD Indicators
www.oecd.org/edu/eag2011
On the OECD’s Indicators of Education Systems (INES) programme, visit:
INES Programme overview brochure
Chart source: OECD Education Database

Education does not equal skills

by Julie Harris
Consultant, OECD Department of Education

Mapping skills at the European Youth Forum

I went back 25 years in time yesterday, as I sat with participants at the European Youth Forum, all young, vibrant, educated and driven. I felt as if I were at university with my daughter and 100 of her friends. We discussed the future, skills, and in particular, the skills mismatch, described by Andreas Schleicher as “a lot of unemployed graduates plus a lot of employers looking for skilled workers”.

At the eve of my own career 25 years ago, my current profession did not exist. The Internet did not exist. There were fewer graduates and fewer employers looking for skilled employees. Did we worry about getting jobs? Probably, but back then a degree was the passkey.

Today, as my daughter graduates from college in 2013, the debate for her as well as for the 120 participants we worked with today, centred around jobs, skills and education. Just what is the link? Does a degree guarantee a job? Less and less so. Does work experience play a role? Yes, but the youth in my breakout group felt that unpaid internships amounted to exploitation and rarely provided the learning originally intended. What about the “soft” skills that so many students report are not developed in traditional school settings: clear communication skills, emotional intelligence, problem-solving, collaboration, curiosity, critical thinking and technological skills? How do individuals best acquire these skills – which mean more to long-term professional success than purely occupational skills do – and what do we need to do as a society to develop, value and encourage such skill development?

As Andreas Schleicher pointed out in his introduction to yesterday’s session, we need to build strong generic skills (skills that cross contexts, such as reading, writing, problem-solving, communication and collaboration), better utilise talent pools and skill for future jobs.

So how do we go about that?

Some of the ideas participants in the session came up with were:

1. Link studies to labour market demand. Should governments regulate entry into study programmes, for example when there is a skills surplus and a jobs deficit?
2. Improve career counselling to students and involve parents. Help students and parents know what the jobs of the future will be, where some of the shortages may lie and what skills will best help them succeed.
3. Provide internships/work experience opportunities on a parallel track along with university studies (as in the United States and France).
4. Put more professional, practical skills training into university education. 
5. Encourage entrepreneurship and innovation among youth: communicate that small-business owners are important actors in society and that there is room for thinking outside the box, across disciplines and beyond borders.
6. Build skills locally (rather than outsourcing to cheaper providers).
7. Keep in mind that skills mismatch can begin at school – tracking can lead to rigidity and close down broader skills development. 

In sum, and as one participant put it, skills is a complex issue. It is more than the ability to “do something” and bigger, much bigger than education alone. Education, both formal and informal, at school and in the workplace, gleaned young and old, is a vital piece of the skills puzzle, but education alone does not skills make.

Learn more:
European Youth Forum: Youth Employment: A Call for Change
OECD Skills Strategy
Participate in the 2012 OECD Global Youth Video Competition