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Meeting the Growing Demand for Skilled Labor. Jan Rutkowski World Bank Sarajevo October 27-28. World Bank work on skills and jobs. Main Messages. The shift in labor demand: from less to more skilled jobs
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Meeting the Growing Demand for Skilled Labor Jan Rutkowski World Bank Sarajevo October 27-28
Main Messages • The shift in labor demand: from less to more skilled jobs • Industrial restructuring is an important source of a skills mismatch in transition economies • Hard skills are not enough: soft skills play a critical role • Skills mismatch may become an obstacle to modernization and growth of transition economies • Skills ≠ diplomas need to develop better measures of skills supply and demand
Outline • World Bank studies on labor market skills in Europe and Central Asia • Regional report • Country studies • Planned surveys of skills supply and demand • Main findings of country studies • FYR Macedonia • Croatia • Poland • Policy response to the skills gap
Regional report: Skills, not just diplomas • Demand for skills in ECA • Education and the supply of skills to the ECA market • Resolving the skills shortage in the ECA region: A policy framework • Managing for results at the pre-university level of education • Managing for results in the tertiary education sector • Advancing adult learning in ECA
Big forces point in one direction on the demand side: more skills are needed
Recent country studies • Ukraine labor demand study (2009) • Croatia: Reaching and sustaining higher rates of economic growth (2009) • Are Skills Constraining Growth in Bosnia and Herzegovina (2009) • Demand for skills in FYR Macedonia (2010) • Fuelling growth and competitiveness in Poland through employment, skills and innovation (2011)
Skills measurement project World-wide project on the supply of and demand for skills • Household based standardized survey of the supply of skills • Employer based standardized survey of the demand for skills • WB countries to be covered: Macedonia and Serbia
Increase in demand for professional and technical skills Macedonia Poland
Enterprise restructuring gives rise to a skills mismatch: newly jobs differ from old jobs (Macedonia)
Skills mismatch has many dimensions • Between occupational groups • Too many social scientists, too few engineers • Too many clerks, too few nurses and electricians • Within occupational group (skills gap) • Inadequate technical (job specific) skills • Inadequate cognitive skills • Inadequate behavioral & social (soft) skills • Too much theoretical knowledge, too little practical skills
No direct & single measure of the skills mismatch • Only proxies for skills: education, occupation • But skills ≠diplomas, educated ≠ skilled • Labor market indicators • Unemployment rate: excess supply • Vacancy rate: unmet demand • U/V ratio (by education, occupation) • Employer surveys • Tracer surveys of graduates • Poland: obligatory for tertiary education institutions
Paradox of manual labor: falling demand coupled with shortages
Modern and innovative firms are hit most by skill shortages (Macedonia)
Top six skills that modern firms value more than traditional firms (Macedonia)
The challenge of closing the skills gap • Educational system more responsive to the changing labor market needs • Broad and transferable skills to prepare workers for the world of growing job and occupational mobility • Interactions with employers • Life long learning • More emphasis on development of soft skills • Work attitudes and behavioral skills as important for employability as hard technical skills • Educational system focuses on equipping students with cognitive & technical skills rather than soft skills • Closing the skills gap will require reorientation of educational and training policy • Good and accessible labor market information to guide career choices • As opposed to manpower planning • Better information on skills supply and demand • Employer surveys, tracer surveys of graduates, survey of skills