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

Skills on Show

by Joanne Caddy
Senior Analyst, Skills Beyond Schools Division, Directorate for Education

Upon entering the vast hall, I was first struck by the quiet concentration etched on the contestants’ faces amidst the hustle and bustle. Here gathered Britain’s best young professionals – each one determined to prove their skill as tile-layers, electricians, plumbers, make-up artists, web designers, IT technicians, mobile robotics designers and landscape gardeners. Each one going for gold at the UK Skills Show, held annually as part of WorldSkills International  to celebrate skilled young people and recognise the ‘skills stars’ of today and tomorrow.

Earlier that day, in a far smaller room, another group of people had been equally intent in exploring the other side of the skills equation.

In his opening address to the UKCES-OECD international workshop on “Employer Ownership: Strengthening Partnerships to Enhance Skills Investment”, the UK Minister for Skills, Matthew Hancock MP underscored the urgent need to upgrade Britain’s skills against the backdrop of the global race to develop and deploy the talent needed in an innovation-driven economy. In launching the second round of the Employer Ownership of Skills Pilot, he called upon businesses to form partnerships and put forward ambitious and transformative proposals which use public funds to leverage private investment and deliver training more attuned to the needs of both businesses and people. For Minister Hancock this investment of £250 million is worth every penny, because “skills bring a better job for the individual and a job done better for the employer – but also for society.” Having kicked off the workshop, he then headed off to tour the Skills Show himself and try his hand at one of the many “Have a Go” sessions.

Meanwhile, back at the workshop a great line-up of speakers shared their tips on how to build solid skills partnernships in practice. Jaguar Land Rover took about two years to build a network of universities to deliver targeted courses for their staff as part of their Technical Accreditation Scheme – an effort which was described as: “even harder than building great cars”. Credit Suisse now offers 750 apprentices in banking and IT systems, adopting a “just-in-time” learning concept where: “you learn what you need in practice, and then you practice what you learned at your workplace.” In The Netherlands, the newly established Foundation for Cooperation between Vocational Education, Training and the Labour Market (SBB) brings together employers, government and vocational education and training (VET) institutions to jointly develop VET qualifications, work placements and career guidance.

The OECD Skills Strategy provided a useful framework for the lively small group discussions which followed. They delivered concrete priorities for action, such as: changing the funding system to drive behaviour; strong leadership among small and medium-sized enterprises (SMEs) to ensure their skill needs are met; and building a sustainable skills system through strong partnerships between business, government and other stakeholders. As our team leading the OECD Skills Beyond Schools country reviews could confirm, few, if any, of the issues raised during the workshop are unique to the UK, but are to be found in many other OECD countries.

Strengthening national skills systems may take sustained efforts, but much is at stake. Judging by the young contestants at work in that huge hall last week, our future is in very skilled hands indeed.

Links:
OECD Skills Strategy
skills.oecd.org
OECD Survey of Adult Skills (PIAAC)
OECD Skills Beyond Schools
Slideshare presentations on skills
Photo credit: Make-up artist/Shutterstock

Second chances in education

by Marilyn Achiron
Editor, Directorate for Education

We all know how important the first years of formal education are; but what if the education provided during those years isn’t the best it can be? Are students forever penalised? A study in Canada that followed the 15-year-old students who had participated in PISA in 2000 and re-assessed their reading skills 9 years later shows that where education and training opportunities are readily available, deficits in initial education do not doom individuals to poor reading proficiency for the rest of their lives. In fact, on average, the young people surveyed gained 57 score points on the PISA reading scale between the ages of 15 and 24 – the equivalent of more than one year of school.

As this month’s PISA in Focus relates, those students who had performed poorly when they were 15 improved the most during the 9-year period; yet, for the most part, they were not able to fully catch up with their peers. For example, in 2000, when students who participated in PISA were 15, girls outscored boys in reading by an average of 32 points; by 2009, that gap had narrowed to 18 points. Similarly in PISA 2000, socio-economically advantaged students outscored their disadvantaged peers by more than 65 points; by 2009 that gap had narrowed to 50 points.

But one group of students did close the gap entirely: students born outside of Canada. At the age of 15, those born in Canada outperformed those born outside of the country by more than 20 score points – 545 to 524 score points, respectively. By the age of 24, young people with an immigrant background scored on a par with those who had been born in the country – around 600 score points, on average. This significant finding reflects the effectiveness of Canada’s education and integration policies.

The Canadian study identifies several ways that initial disadvantage in education can be overcome. Improvements in reading proficiency are strongly related to time spent in the education system, regardless of the educational pathways individuals follow. For instance, the improvement in reading skills among young adults who had spent 4 or more years in school after age 15 was about the same, whether they had actually completed a degree or not by age 24. Those who never completed a programme above high school, but who studied for 4 or more years after high school, improved their reading skills by 70 score points. Those who did complete a university degree improved their reading skills by 60 score points.

There is no doubt that greater proficiency at early ages is an advantage for further education and creates opportunities for additional studies that may not be as readily available to low-achievers. While taking the most common path – through secondary and then directly on to university-level education – appears to maximise improvements in reading proficiency, not everyone takes that route. The evidence in this unique study shows that learning does not end with compulsory education. Second-chance programmes and flexibility in education systems can help young people who have not had the advantages of supportive learning environments early in their lives to improve their reading proficiency later on.


Links:

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

PISA in Focus No. 19: Is there really such a thing as a second chance in education? 

Photo credit:  Stack of books / Shutterstock

Making the right connections

by Barbara Ischinger
Director for Education

It’s becoming clear to me that the crisis in youth unemployment around the world is not just one of the aftershocks of the global economic downturn, but may also have roots in education systems that are not adequately preparing students for 21st-century economies. I took that message to a regional conference on Promoting Youth Employment in North Africa,  held in Tunis in mid-July, where I presented not only the OECD Skills Strategy but also discussed the importance of improving the quality of education and of teachers, and of making quality education accessible to all.

Some 41% of 15-24 year-olds in Tunisia are unemployed – a statistic that is devastating in the present and potentially catastrophic for the future of the country and the region. In more than half of OECD countries, the rate of unemployment among young people approaches or exceeds 20%; and many of the underlying conditions are the same as those found in Tunisia. These include not only weak or stagnant economic growth, but education systems that cling to outdated policies and practices and are divorced from the labour market.

Today, education systems are expected to provide graduates not only with foundation skills and knowledge in given disciplines, but also with the skills needed to adapt to changing employment circumstances and to transfer what they have learned to different environments – what are known as generic skills. To do this effectively, there has to be more co-operation between education systems and industry. Without dialogue, education systems will not know which skills are in demand in the labour market, while prospective employers will not know whether graduates are leaving education with the skills they are looking for. Employers, too, have to be willing to invest in further training for their employees; and policy makers need to provide fiscal incentives to make it attractive for employers to do so.

But equally important, education systems need to adopt more innovative, project-focused teaching methods, particularly in science, to spark students’ curiosity and involvement. I’m encouraged to see this already happening in many places: from France’s La Main à la Pâte programme, developed by the French Academy of Sciences, which aims to reinvigorate a hands-on approach to the teaching of science in elementary schools, to the Agastya International Foundation, which dispatches mobile science labs throughout rural India, to the science education company  founded by Sally Ride, the first American woman in space, who died last month, whose aim is to develop and support young girls’ and boys’ interest in science, math and technology.

There are – and will be – many more of these kinds of initiatives. Their value is not only that they help to make science more meaningful to students, but they can also help to make the important connection between what students learn in school and how that knowledge and those skills can be used effectively in the wider world. And if we can also make more connections between education systems and employers, then we may be able to help more young people fulfil their potential – and help more societies prosper – by creating a better match between young people’s skills and the jobs that propel economies.

Links
OECD Skills Strategy
Related blog posts:
“Creativity” is spelled with a “why”
Understanding youth, unemployment and skills in Africa
Photo credit: Stack of pebbles / Shutterstock

Older, wiser, better: ageing workforce and fast-track societies

by Julie Harris,
Consultant, Directorate for Education

Simple fact: older workers are leaving the labour force earlier than they did in the 60s and 70s. The retirement age declined steadily across OECD countries from the 1970s to the early 2000s. Over the past decade this drop has levelled off, with some countries experiencing a slight upturn. Despite this, apart from Japan and Korea, it is still significantly lower than in the 1960s and 1970s.

At the same time retirement age has been declining, life expectancy has been increasing. In many OECD countries, workers who retire can expect to live another two decades.

If this situation does not change, there will be twice the number of retirees per worker in OECD countries by 2050. You don't need to be an economist to understand that such an eventuality would pose a serious threat to living standards and tear deeply into the fabric of the social safety net.

So, what to do? How can governments move to remedy this situation? And what can companies do to better take advantage of senior employees' skills?

The OECD Skills Strategy states that both governments and companies should work to discourage early retirement. To keep older workers in the labour market, many countries have eliminated early retirement schemes, increased the official pensionable age and corrected distorted financial incentives to retire early. To tackle demand-side barriers to employing older workers, some countries have tried to balance labour costs with productivity by reducing employers’ social security contributions or providing wage subsidies for older workers. Lifelong learning and targeted training, especially in mid-career, can improve employability in later life as well and discourage early withdrawal from the labour market. A rise in the pensionable age also lengthens the period of time over which employers could recover training costs; hence, an attractive incentive to motivate more employers and older employees to invest in training.

Anne-Sophie Parent, Secretary General of AGE Platform Europe, an NGO that promotes the interests of people over 50 across Europe, is convinced that scrapping the mandatory retirement age is key to increasing the employability of older workers. This fixed age, she explains, is like the expiry date on a pot of yoghurt: the closer it gets, the more you're inclined to think of it as no good.

According to the OECD, employees between 25 and 54 are twice as likely to take part in job training as those over 55, confirming employers’ unwillingness to invest in senior staff. Removing the mandatory age would help make employers see older employees as valuable, she argues, giving them an incentive to invest in their skills through training.

Participation in job-related training over the last month, by age group, 2009
(As a percentage of the employed in the age group)

If doing away with the mandatory age is crucial, governments must also address certain significant workplace problems to help older workers get a foothold in the job market. Rodolphe Delacroix, Senior Consultant at consulting firm Towers Watson, cites the case of Finland, which pushed back the average retirement age three years by tackling work-related stress, strenuousness of work and work-life balance.

Delacroix adds that governments can use social and fiscal incentives to entice companies to hire people over 50 and set up progressive retirement plans that allow older employees to reduce their working hours over a number of years. These could replace early retirement plans, which have been the norm in countries such as France.

Companies, for their part, must make career planning an integral part of their human resources policy early on, he maintains. They need to manage the end of employees' careers well to ensure that knowledge and skills are passed on to younger employees.

Older workers are perfectly positioned to help countries maximise the use of skills, as outlined in the OECD Skills Strategy. They can develop relevant skills of younger workers, supply their skills to the labour market and put them to effective use. Indeed, it is hard to imagine how they can't be a boon to our crisis-ridden economies.

Links:
OECD Employment Outlook
Ageing and Employment Policies
Ageing and Skills: A Review and Analysis of Skill Gain and Skill Loss Over the Lifespan and Over Time
Data visualisation: Labour force participation by gender and age, 2010
Live Longer, Work Longer: Statistics on average effective age of retirement
Learn more about ageing societies on: http://www.skills.oecd.org
Photo credit: Young and old businessman / Shutterstock
Chart source:  Calculations based on the EU-LFS.

Understanding youth, unemployment and skills in Africa

by Denielle Sachs
McKinsey Social Sector Office

For those working on employment issues, one thing is clear: the tense imbalance between the demands of the labor market and the supply of appropriately skilled workers is reaching its breaking point. Last week, the McKinsey Global Institute launched, The world at work: jobs and skills for 3.5 billion people. The report found that by 2020 there could be as many as 40 million too few high-skill workers and up to 95 million too many low-skill workers out in the job market.
Avoiding such massive imbalances will require a radical approach to accelerate education and skills building, and to boost job creation for less-skilled workers. Anything less and we will see a growing shortage of high-skill workers, persistent joblessness for many low- and middle-skill workers, rising income inequality, and distressingly high rates of youth unemployment. The numbers are clear: by 2030, the world will have as many as 1 billion workers without even secondary education, and most of them will be living in India, South Asia and Africa.

A lot of institutions are looking at these issues , including OECD and their recently launched Skills Strategy. As part of our ongoing research on youth unemployment and the skills-jobs mismatch, we asked a few experts what a solution might look like for young people in Africa where the under 25 represent three-fifths of sub-Saharan Africa’s unemployed population, and 72 percent of the youth population lives on less than $2 a day.

First, we have to understand who we mean when we talk about the young and out-of-work in Africa. Fred Swaniker, Founder and CEO of the African Leadership Academy, tells us that, on average, she is an 18-year-old girl, living in a rural area, literate but not attending school. To his mind, entrepreneurship – both the technical skills and the mindset — is the answer. It should be an integral part of every child’s education whether that schooling be formal or informal.

 For the Chief Economist for the World Bank’s Africa Region Shantayanan Devarajan, the answer lies in productivity. “The challenge of youth employment in Africa is not just to create more wage and salary jobs but to increase the productivity, and hence earnings, of the majority of young people.” This can only happen by “first, increasing their basic skills, which they can take with them when they move to new enterprises; and second, creating jobs in the formal sector by improving the economy’s competitiveness, so that this sector can absorb more qualified workers into a productive workforce.”

In South Africa, a very specific socio-political context post-apartheid, Thero Setiloane, CEO of the Business Leadership South Africa, explains that access to education and the quality of that education (“Only 35 percent of the children in third grade are able to pass the literacy and numeracy tests.”) are major stumbling blocks. His preference is for a joint government-business solution. “Business must work with government to adapt the school curriculum… so that young people leave school ready for work. Training programs must be tailored to demand…We also need to build in incentives for businesses to address the social-capital deficit in poor communities.”

Moataz Al Alfi, CEO of the Egypt Kuwait Holding Company could not agree more. Coming from the Middle East where the “paradox of the labour markets”, as he calls it, is perhaps at its worst, he calls for “a solution that requires a strong partnership between business, with its urgent need for skilled workers, and government, which is charged with educating young people.” The region currently has the highest youth unemployment rate in the world, at 25 percent. And, on the heels of the Arab Spring, and in the midst of the lingering economic crisis, it is only expected to rise.  He too returns to the issue of a failing education system that does not prepare young people for the jobs that the market desperately needs to fill.

Links:
Join the debate and register for our online panel event on June 26th at 8am EDT //2pm CEST , featuring experts from the OECD and IFC
See also: OECD Skills Strategy

Visit our interactive portal on skills: http://skills.oecd.org
OECD Development Centre

Photo credit: African youth / Shutterstock

Everybody into the talent pool

by Marilyn Achiron 
Editor, Directorate for Education

The OECD has just formulated a Skills Strategy to help countries make the most of their peoples’ talents.

How does one even begin to consider an issue as complex as skills? We found that visualising the supply of skills as a talent pool helps. The idea is to create a larger and larger pool of people who have fully developed their skills, encourage those people to supply their skills to the labour market, and then ensure that those skills are used effectively on the job. This new animated video will show you what we mean. 

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  #OECDSkills

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

Starting Strong: The people helping to raise young children

by Kelly Makowiecki
Assistant to the Early Childhood Education and Care Project, Directorate for Education

For my generation, the concept of a stay-at-home parent seems like something of the past. And even if you want to stay home for the first few years of your child’s life, who can afford not to work these days? So what are kids up to during those precious, formative early years after their parents go back to work and before compulsory school begins around age 5 or 6? At some point, a lot of them enter into a formal education or care setting and are the responsibility of someone other than their family.

Who are the people we turn to for help in the immensely important role of raising our young children? And can we value them as much as we depend on them?

That’s difficult to judge when, for starters, the early childhood education and care (ECEC) workforce consists of a wide variety of actors with an equally wide range of qualifications.  Those working as preschool/kindergarten teachers tend to have higher qualification requirements than those working in child care centres or family day care: the former usually need a university degree, while the latter sometimes only need to complete compulsory education. But in countries like Japan and Portugal, the same university-level qualification is required for both job types.

Maybe they’ve completed a 4-year teacher training programme or have a vocational degree in child care. Maybe they have prior learning or work experience that was converted into credits towards an ECEC certification, which is popular in countries like the Netherlands and New Zealand. No matter the pathway taken into the profession, professionals need to be equipped with the knowledge and skills that enable them to foster a high-quality pedagogic environment conducive to favourable cognitive and social outcomes for children.

So perhaps more important than the qualification level itself is the content of the training required to obtain the qualification. When entrusting a child with a childcare professional, we expect them to know about how children develop and learn. We want them to be trained in nurturing children’s perspectives and responding to their needs. Such skills ensure that kids are provided with the strong start they deserve.

Thanks to a growing body of research, the importance of high-quality ECEC is increasingly apparent. Academic institutions all over the world have or are developing programmes of study in this field. Governments are investing in recruiting better trained staff and undertaking campaigns to raise the profile of the profession. Employers are encouraging their staff to pursue ongoing training to fill in knowledge gaps and maintain their professional quality.

Are these endeavours cheap? No. Are they worth it? Yes. The ECEC workforce is on the front line of helping to ensure that young children develop the skills they need to be successful in compulsory school and beyond. School failure and its social costs later in life can be far more expensive.

The OECD has been reviewing ECEC for well over a decade; and it is no wonder that improving workforce qualifications, training and working conditions has emerged as a policy priority across countries. To learn more, check out Starting Strong III: A quality toolbox for early childhood education and care, a new OECD publication to be launched at a Roundtable in Oslo, Norway on 23-24 January 2012.

Links:
For more information about OECD’s work on early childhood education and care (ECEC): www.oecd.org/edu/earlychildhood
Online quality toolbox for early childhood education and care: www.oecd.org/edu/earlychildhood/toolbox
Investing in high-quality early childhood education and care (ECEC) (PDF 1.79 MB)
OECD-Norway High-level Roundtable: Starting Strong: Implementing Policies for High Quality Early Childhood Education and Care (ECEC)

Related blog posts:
Starting Strong: what should children learn?
Early childhood education: an international development issue

Photo credit: Microsoft