promoting human capital: are governments effective? the case of macedonia dr. nikica mojsoska...
TRANSCRIPT
Promoting Human Capital: Are governments effective? The case of
Macedonia
Dr. Nikica Mojsoska BlazevskiUniversity American College-Skopje
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
Human capital endowment“The level of human capital is still low.”
Without well educated workforce Macedonia cannot become a modern, innovation-driven, export-oriented economy
“The low level of education and … contribute to a low general level of productivity” (EC, Progress Report, p.28)
“ The authorities continued to improve both the physical infrastructure of education and the regulatory framework …”
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
Growth path: neglected human capital
• Low-skill specialisation, with low-level equilibrium, low growth, high U, informal work, insufficient technological change • Emphasis on school inputs rather than outputs• Education policy was mainly focused on dealing with segmented systems of provision, with limited attention to employability (ETF, 2009)
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
Education outputs• Poor achievements on international assessment • Low expected years of schooling (12.3)• High share of early school leavers (1.8 p.p. higher than in
the EU-27, 6 p.p. for females) • Only 14.3% of 30-34 years-olds with completed tertiary
education (Europe 2020 targets 40%) • Difficult school-to-work transition
WEF Competitiveness Report
MKD NMS
Quantity of Education 4.6 5.9
Quality of Education 4.1 4.5Conference "New Skills for New Jobs",
Sarajevo, 27-28 October, 2011
Education pays-off
• Much higher employment rates and lower unemployment rate for highly educated persons
• Higher probability of finding a job• Lower incidence of discouraged workers• Wage premiums
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
Variables 1998 2000 2002A. Estimated coefficients for dependent variable ln(net monthly
wage)constant 7.394 8.26 7.772 (90.826)1 (96.839) (92.262)age 0.031 0.013 0.024 (8.506) (3.583) (6.498)agesquared -0.00034 -0.00017 -0.00027 (-7.919) (-3.960) (-6.276)3-year secondary2 0.234 0.171 0.146 (11.234) (8.194) (6.938)4-year secondary 0.367 0.324 0.317 (22.036) (19.825) (19.357)non-tertiary 0.501 0.509 0.427 (18.473) (20.022) (15.562)university 0.808 0.769 0.725 (35.472) (34.076) (34.280)gender 0.151 0.148 0.179 (11.032) (10.965) (13.489)
B. Returns to experience, education and other personal characteristics3
age 3.1% 1.3% 2.4%agesquared -0.03% -0.02% -0.03%3-year secondary2 26.4% 18.6% 15.8%4-year secondary 44.3% 38.3% 37.3%non-tertiary 65.0% 66.4% 53.2%university 124.3% 115.8% 106.4%gender 16.3% 16.0% 19.6%
Educational reforms• Recent educational reforms:
- introduction of nine-year primary education, - compulsory secondary education, - revised curriculums which promote outcome oriented and interactive teaching and learning, - reform of 4-year VET,- early learning of English language and ICT skills,- implementation of Bologna declaration,- expansion and subsidies to higher education
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
Improvement of physical capacity at lower education levels and expansion of provision at university education
Report: Skills Not Just Diplomas
“Without adequate information on the skills students acquire and those adults actually have, policies to address skills gaps operate in the dark,” Lars Sondergaard, lead author of the report.
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
Vertical mismatch - LFS
2007 2008
Q2/2011
E UExcess supply E U
Excess supply E U
Excess supply
University 15.5 7.4 -8 14.2 7.8 -6.5 18.6 13.2 -5.4
Higher 4.4 2.1 -2.3 4 2 -2 3.2 2.0 -1.2
4 years secondary 42.1 39.3 -2.7 42.1 39.4 -2.7 41.4 38.2 -3.2
3 years secondary 12.1 15.3 3.2 12.3 13.4 1.1 11.3 11.7 0.4
Primary and lower secondary 20.7 29.5 8.8 22.3 31.5 9.1 20.5 29.6 9.1Incomplete primary 4.2 4.7 0.4 4.3 4.6 0.3 4.3 3.6 -0.7
Without education 1.1 1.7 0.6 0.7 1.5 0.8 0.6 1.8 1.1
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
Occupational mismatch - ESA
• Planned demand (vacancies) equal to about 1.5% of current employment (10,060)
• By industry: manufacturing (50%), trade (21.2%), construction (8%) and 5% in transport and communications
• Highest demand for secondary educated workers (62.3%)
• About 10% of total demand for workers with tertiary education
• Focus on experienced workers, foreign languages, IT, and soft skills
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
Occupational mismatch – ESA (2)• 10% of firms reported that experienced difficulty in
hiring (experience and soft skills)• Mainly in manufacturing industry and for secondary-
educated • Findings are used for designing and implementing
some ALMPs
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
Findings - ESA• Mismatch problem is driven by specific factors at
different educational levels- at lowest educational level, it is mainly an issue of low qualifications and lack of specific skills of non-qualified workers;- at lower and upper secondary education, the problem is lack of specialization of gymnasium graduates, and lack of additional skills and working experience for the rest;- for highly educated individuals, it is the occupational choice and surplus of degrees in less market-oriented sciences
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
Skill Demand Survey - WBAbout 30 percent of employers claim that hiring a worker with required skills is difficult
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
Skill Demand Survey – WB (2)• Modern and dynamic firms are more seriously
harmed by skill shortages – potential constrain to growth
• Newly created jobs differ in the skill content from old destructed jobs: high professional skills, or medium-level non-manual skills
• Demand for advanced technical and professional skills
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
Skill Demand Survey – WB (3)• The aggregate job vacancy rate is 3% (unmet
demand)• Vacancy duration from 2 weeks (sales worker) to 5
weeks (professional)
0123456
wee
ks
Time needed to fill a vacancy2009
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
Skill Demand Survey – WB (4)
Top 5 most important skills for employers:1.Sense of work ethics, 2.Overall literacy,3.Communication skills,4.Customer care,5.Motivation.
Foreign language, ICT, technical / vocational skills, problem-solving
Top 5 skills that applicants lack:
1.Responsibility and reliability, 2.Motivation and commitment,3.Communication skills,4.Customer care,5.General literacy skills.
Unemployment seems more related to work ethics and key competencies than with technical/vocational and job specific-skills
Skill Demand Survey – WB (5)• Lessons for educational policy:1. Education system and curricula should be made
more responsive to labour market needs – engage employers
2. More attention should be paid to soft skills – “beyond the traditional function of the educational system “- Soft skills usually acquired outside the school system: Improve and expand early childhood learning programs, especially for children from disadvantaged social background/rural areas.
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011
What do studies show?• Employers value key competencies and soft skills• Greater demand for:
- highly educated individuals and those with secondary education, and - medium and advanced professional and occupational skills
• Occupations in demand? - Sectoral skill committees
• Is it effective to invest heavily in higher education?• The role of institutions
Conference "New Skills for New Jobs", Sarajevo, 27-28 October, 2011