Comparative assessment of skills in Russia: An economic rationale
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Comparative assessment of skills in Russia: An economic
rationale
T. Scott Murray
DataAngel Policy Research Inc.
dataangel@mac.com
What is old is new:
In the beginning: The US
• Key scientific advances:– Theory: The Abrams main battle tank and
insight into what makes adult reading tasks difficult. Kirsch and Mosenthal
– Applied statistics: The development of statistical techniques to summarize proficiency and to estimate errors. Bock and Rubin
– Enabled the 1985 Young Adult Literacy Survey (YALS) ETS,NCES and USDOL
In the beginning: Canada
• In Canada 25 years of Scott measuring every kind of social and economic ill and being able to explain very little of it
• Celtic allergy to empires built on unproven assertions of systemic discrimination
• The Southam survey “24% of adult Canadians had literacy skill problems”
• Conduct of the survey of 1989 Literacy Skills Used in Daily Activities (LSUDA)
Precipitated multiple rounds of data collection:
• IALS 1994 9 countries• IALS 1996 5 countries• IALS 1998 12 countries• Vanuatu, Immigrants in Ontario, the Deaf and
Hard of Hearing in Ontario• ALL 2003• ALL 2005• PIAAC 2011
What was learned for policy:
• Large differences in skill existed both within and between countries
• These differences were far larger than implied by differences in educational attainment
• The differences mattered to individual outcomes but were too large to attribute to differences in educational quality
The policy response:
• There is no problem “Our problem is the same as that of our trading partners”
• There is a problem but it doesn’t matter, “It doesn’t increase the size of the economic pie it is just an allocative mechanism”
• There is a problem, it matters to growth but it is not our problem “It is a problem for individuals and firms to correct”
The hypothesis of market failure:
• Only governments have the tools to correct market failures:– Information– Incentives
Issues that need attention: The dreaded mastery level
• All adult assessments have used 80% as a proxy for what employers expect of workers
• PISA uses 62.5% because education systems are not focused on mastery
• OECD is pushing to have the PIAAC standard changed to distance it from IALS, a step that would break the series
• Empirical analysis by Somers & Murray suggests that the Response Proficiency should vary by occupation from 40% to 95%
Brain Structure
Left to RightLeft to Right
BBaacckk ttoo FFrroonntt
brain fromthe top
Brain Structure
InformationInformation(processing-based)(processing-based)
Knowledge(thinking-based)(thinking-based)
BBaacckk ttoo FFrroonntt
Brain Structure
DecodingPET Scan
brain fromthe side
What is this brain doing?
HearingPET Scan
Brain Structure
What is this brain doing?
SpeakingPET Scan
Brain Structure
What is this brain doing?
MathPET Scan
Brain Structure
What is this brain doing?
Dr. Michael O’Boyle imagesfrom Texas Tech. University School of Medicine, Department of Neurology
ThinkingPET Scan
Brain Structure
What is this brain doing?
Brain Structure
http://www.nil.wustl.edu/labs/raichle/
Issues for further study:
• Developing a better understanding of supply, demand and the efficiency of markets
• Our analysis suggests that supply-side interventions are not enough. One needs to manage demand and improve the efficiency of markets that match workers with jobs
Theoretical Framework: a “Markets” Model of SkillMarkets
for skill:
•Education
•Labour
•Health
•Social + quality of early childhood experience+ quantity of primaryand secondary education+ quantity and quality of tertiary+ quantity and quality ofadult learning (formal, non-formal, informal)+/- immigration+/- emmigration- skill loss associated with insufficient demand+/- social demand for skill+/- economic demand for skill
Outcomes
Skill Demand Skill Supply = skill stock + net skill flow from lifelong, life-wide learning
Context MICRO MESO MACRO
(Individuals) (Social Institutions) (Systems)
• Economic
• Social
• Educational
• Health
Skill gain and loss, the behaviour of firms and the possibility of multiple equilibria:
20 30 40 50 60 Age in 1994
200
225
250
275
300
IALS 1994
Canada
39 49 59 69 Age in 200329
ALLS 2003
Do
cum
ent
Lit
erac
y S
core
ALLS 2003 - All AdultsALLS 2003 - Recent Immigrants excluded
One way in which firms compensate for a workforce with weak literacy skills is to adopt less productive work organizations, work processes and technologies of production:
Output
Cost
The production frontier: the point where one gets the most outputat the lowest unit cost
•
•
A less productiveconfiguration
Correcting the market failure:
• Projecting down: skill profiles for small areas
• Projecting down: Skill profiles for detailed occupations and cost-benefit analyses
• Projecting out: Forecasts of skill supply and demand
• RCT’s and quasi-experimental studies to establish effect sizes and cost-benefit
• Our basic hypothesis: A failure in the literacy market
• The literacy market failure can be traced back to:– Complacency due to 50 years of economic
success– A failure to appreciate the implications of the
changes occurring in the global economy– A lack of information on the nature of the problem– A lack of tools to assess skills– A lack of efficient and effective instructional
programs
Projecting down: The local distributions of skill
Alberta - Number of Adults at Levels 1 and 2 Prose Literacy
0 - 30
31 - 60
61 - 90
91 - 120
121 - 150
151 - 180
181- 210
211 - 240
241 - 270
More than 270
No Data
175 0 17587.5 Kilometers
Projecting down: Absolute and relative risks of being in literacy shortage by occupation,
Canada 2006:
Colleges are admitting large numbers of low skilled youth:
Percent of Population at Levels 1-3 Enrolled in Collegeby Province - by Literacy Level
0% 10% 20% 30% 40% 50% 60%
Manitoba
Prince Edward Island
Saskatchewan
New Brinswick
British Columbia
Nova Scotia
Quebec
Alberta
Newfoundland andLabrador
Ontario
Level 1 Level 2 Level 3
Fixing the flow: Quality of secondary graduates is not improving, large percentages have skills below those needed to take full advantage of PSE, and there are
large social inequities
Projecting out: How the distribution of performance by level is likely to change 2001 - 2031
Population Projections - Population at various Literacy Levels Province (All) - Immigration (All) - Age
Group (All) - Education Level (All)
0%10%
20%30%40%50%
60%70%80%
90%100%
2001 2005 2015 2031
Literacy Level
Po
pu
lati
on
Level 4/5
Level 3
Level 2
Level 1
59-B.C. 0% -1% 1% -1% 1%
Literacy demand rising rapidly and literacy supply flat: Shortages will grow over coming decade
Understanding the learning needs of low-
skilled adults: The transition from learning to read to reading to learn:
225 275 325 375 500
Learning to read
0
Reading to learnProficiency dominated by mechanics of reading
Proficiency dominated by cognitive strategies
Level 1 Level 2 Level 3 Level 4 Level 5
Literacy market segments in Canada:
Segments in the Canadian literacy market:
• The efficiency of the market for literacy: Balance of total supply and total demand (in points)
The efficiency of the market for literacy: Literacy skill surpluses and shortages by level of the job (in workers)
Figure 4.3A Number of workers in literacy skill surplus and shortage by literacy proficiency level, all
occupations, 48-Alberta, 2006
-600,000
-400,000
-200,000
-
200,000
400,000
600,000
1 2 3 4 5
Proficiency level
Skill
short
ag
e/s
urp
lus
(work
ers
)
50% of workers in Alberta are in shortage:
Estimated benefits are clear:
Issue for further study: Improving our understanding of how skill drives
productivity and wages• Two competing hypotheses:
– Skill is a general driver of productivity growth across the whole spectrum of occupational demand
– Skill only pays in jobs where demand for use is high
– Reder: Skill pays but only in bad times
33% of wage variation in Canada is attributable to skill differences:
0 10 20 30 40 50
Canada
Finland
United Kingdom
Norway
New Zealand
Australia
United States
Ireland
P ortugal
Hungary
Denmark
Slovenia
Netherlands
Belgium (Flanders)
Switzerland
Sweden
Chile
Czech Republic
Germany
P oland
Educational attainmentLiteracy proficiencyExperience
Standardised regression w eights x 100
Source: International Adult Literacy Survey, 1994-1998.
Countries are ranked by the magnitude of the effect parameter associated with educational attainment
The impact of skill on individual labour market outcomesEarnings and literacy proficiency, controlling for education and labour force experience… literacy explains a significant fraction of wage variability in Portugal, but less than education or experience …a sign of an inefficient labour market or low demand…
PRC
A Framework for Thinking about Essential Skills at the Individual Level:
Resolution Processes
ChangingSkill Demands
• Tasks to be accomplished/imposed by society/economy
•Changes associated with the life course
• Individual goals/aspirations
• Functioning in socially heterogeneou s groups
• Acting autonomously
• A well functioning, equitable economy and society
IndividualOutcomes(MICRO)
SocietalOutcomes(MACRO)
Reliance on Physical tools• Reliance on fluid and creative cognitive and meta-cognitive tools
Mechanisms
• Reliance on practical and crystallized cognitive tools
• Reliance on others• Avoidance
• Successful institutions
•firms
•families
•communities
•schools
Outcomes forSocial Institutions(MESO)
Issues for further study: The impact of
skills on health outcomes and costs:
• Adults with low health literacy scores remain 2.5 times more likely to be in fair or poor health even after adjusting for a wide range of variables
• Elimination of skill shortages using “best practice” interventions would break even if it saved 1% of health costs and would yield large economic benefits
Issues for further study: The impact of skills on health outcomes and costs:
• Need to understand biochemical pathway that links skill to health
• Need an RCT to know
• Hypothesis:– Low skill = bad outcomes = chronic stress =
high blood cortisol =impaired immune response = higher rates of CVD, diabetes and cancer
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Qatar
Russia
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Assessment the old way:
• Technically demanding
• Costly
• Operationally demanding
• Slow
Assessment the new way:
• web-based• adaptive • multi-purpose, • low cost• Immediate results for:
– Prose literacy– Document literacy– Numeracy– Reading components– Oral fluency
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