Is there a different skills development model in Asia? Cristina martinez-Fernandez and Kyungsoo Choi, OECD LEED Programme

The OECD has recently launched the OECD Skills Strategy with a clear message of the need to continue investing in education and addressing the demand, supply and utilization of skills. The strategy reinforces the message that skills and educational development for inclusive and sustainable growth are becoming significant drivers in OECD countries. Are Asian countries lagging behind on the challenge? In a just released report on Skills Development Pathways in Asia: Employment and Skills Strategies in Southeast Asia Initiative (ESSSA),  the OECD LEED program argues that Asian countries are working towards developing integrated pathways of skills and employment and that these pathways can be different form OECD countries. The report is an initial insight into the skills challenges ahead for Asian economies but also of the originality of the approaches and the pathways they are choosing.

The report focuses on current efforts in 15 countries in the Asian region: Australia, Cambodia, China, Hong Kong, China, India, Japan, Korea, Malaysia, Mongolia, Nepal, Pakistan, the Philippines, Singapore, Thailand and Viet Nam. Together, these countries represent one of the most dynamic regions in the world, with steady growth, even during the recent financial crisis.

The strategic and policy pathways Asian countries are developing do not duplicate the approaches we can observe in other OECD countries. The Skills development pathways in Asia have a significant focus on developing skills infrastructure in an integrated way with physical infrastructure, taking greater advantage of the synergies of capital investment and industry growth for large infrastructure projects. Asian countries are utilising different strategic approaches to skills development:  Strengthening TVET systems, fostering knowledge intensity through workplace training, developing local skills ecosystems and integrating skills and technologies for green growth.

Emerging policy themes in this approach

The skills development programmes and policies analysed in the report indicate four levels of policy concern for a more integrated approach to skills development:

More investment in skills infrastructure and governance…

Asian countries face common challenges of building up skills infrastructure for creating a training market with quality suppliers, reducing skills mismatches, improving links between training and industry needs, upgrading outdated training systems and increasing industry participation.

Agriculture is still a significant part of many Asian economies. Five countries have large agricultural sectors, which account for over 50% of employment: Cambodia, India, Myanmar, Nepal and Viet Nam.Services sector is overtaking manufacturing. Services employment shares have grown significantly in China, Mongolia, Thailand and Viet Nam during the last decade.

…while addressing the composition of skills and jobs,

The higher skilled occupations such as professionals, technicians, associate professionals and clerks are significantly advanced in the developed countries of Australia, Hong Kong, China, New Zealand and Singapore while Cambodia, Pakistan and Viet Nam are struggling to supply these types of skills.

Indonesia and Pakistan have a high percentage of labourers with either less than one year or only pre-primary education.  While Australia, Japan, Korea and New Zealand have the highest percentage of labour force with a tertiary education, indicating a highly skilled workforce,  in Cambodia, Lao People’s Democratic Republic, Nepal and Viet Nam, colleges and universities do not produce sufficient numbers of graduates in Science, Technology, Engineering and Mathematics (STEM).

…promoting more knowledge intensity in the workplace

To move to higher value‑added production and towards a sustained growth path, increasing the level of workplace training and the quality of training is becoming a key issue.  There  is an urgent need to address knowledge intensity and skilling professional in firms that are embedded in global value chains and technological innovation networks.

SMEs need to be equipped with knowledge of sophisticated financing, and this should be built in in different ways for firm training. There are alternative ways for skills development and knowledge-intensive service activities already well utilised in OECD countries (OECD, forthcoming) but how they relate to developing countries has still not been investigated.

…and integrating skills strategies at the local level

Asian countries are developing skills plans as national statements and frameworks. In most cases there is little specification of how the plans will be implemented at the local level where they need to reach the workforce, firms and organisations. Some countries are now realising the advantages of developing local skills ecosystems and therefore integrating the local implementation into policies and programmes.

Skills development for transition to a green growth economy presents a useful example. At the  national level, it is about setting the right prices and guiding the direction of investment (OECD, 2009), but on the local level it is about training and job placement in a changing environment (Martinez-Fernandez et al., 2010). The cases of Korea and Thailand show the importance of national strategic policy related to sustainable development and climate change.  Demand for new “green” skills and supply need to be balanced and strategically timed. Skills are wasted if they are supplied before industry is ready to use them, a situation which could lead to skill migration from the region.

For the local training dimension, collaboration and flexibility are critical. Facilitating skills and training ecosystems at the local level provides an invisible skills infrastructure that largely reaches stakeholders in connected activities to build capacities in human capital.

Posted on September 18, 2012, in skills development. Bookmark the permalink. Leave a comment.

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