Technical and Vocational Education and Training in Latin America DIANA MEJÍA San José, June 4, 2014 Senior Advisor, Public Policy and Competitiveness [email protected].

Technical and Vocational Education and Training in Latin America

DIANA MEJÍA

San José, June 4, 2014

Senior Advisor, Public Policy and Competitiveness

[email protected]

Overview and way forward

Agenda

1. Relationship between competitiveness and education

2. Diagnosis of Technical and Vocational Education and Training (TVET) in Latin America

3. Recommendations to overcome the challenges in Latin America

4. CAF Program on Education for Productivity

5. Study case: main conclusions of KSP-CAF joint program on TVET in Panama

Relationship between competitiveness and education

Source: World Economic Forum (2012-2013) and Doing Business (2013)

Competitive position

Latin American countries experience a significant dispersion in their competitiveness agendas

0102030405060708090100

0

10

20

30

40

50

60

70

80

90

100

AustriaBélgica Canada

Rep. Checa

Dinamarca

Estonia

Finlandia

Alemania

Grecia

Hungary

Islandia

IrlandaIsrael

Italia

Japón

Luxemburgo

Mexico

Holanda

Nueva ZelandaNoruega

PoloniaPortugal

Eslovaquia

España

SueciaSwitzerland

Turquía

Reino UnidoEE.UU.

Doing Business 2013 (Percentile)

WEF

201

2-20

13 (

Perc

entil

e)

Source: World Economic Forum (Global Competitiveness Index)

Comparison of global indicators of competitiveness

Technical and Vocational Education and Training (TVET) has traditionally been analyzed from the perspective of educational and labor policies. However, currently it is also

assessed from the perspective of productivity policies of businesses and competitiveness policies of economies as a fundamental aspect of countries growth.

Competitiveness Index in Higher Education and Training

Key Indicators on Education - WEF

The Global Competitiveness Index of the WEF includes quality of the education system, quality of primary education and quality of education in science and mathematics, as

well as the availability of scientists and engineers as key components of countries competitiveness.

Quality of education system

Quality of education in sciences and math

Quality of primary education

Availability of scientists and engineers

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

Latin America OECD Asia Total average

Scor

e - 1

(Wor

st) t

o 7

(Bes

t)

Source: CAF , UNESCO (Informes sobre desarrollo Humano) y Hanushek y Woessmann (Schooling, educational achievement, and the Latin American growth puzzle)

Positive relationship between GDP growth and years and quality of education

The positive relationship between GDP growth and average years of education demonstrates the impact of education on productivity. In 1991, Barro demonstrated this correlation for many countries. In 2013 he added that the correlation is stronger if quality

of education, as measured by standardized tests of knowledge in mathematics, science and reading, is included.

6 7 8 9 10

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Venezuela

Uruguay

Trinidad y Tobago

Dominican Rep.

Peru

Paraguay

Panama

EcuadorCosta Rica

Colombia

Chile

Brazil

Bolivia

Argentina

Relationship between GDP growth and years of education

Average years of schooling

GDP

grow

th

Relationship between GDP growth and quality of education

Source: Survey of Adults Skills (PIAAC) (2012).

Correlation between labor productivity and the use of reading skills at work

3.0

3.2

3.4

3.6

3.8

4.0

4.2

4.4

4.6

Use of reading skills at work

GD

P pe

r hou

r wor

ked

(in U

SD)

less more

Source: Survey of Adults Skills (PIAAC) (2012).

Likelihood of positive social and economic outcomes among highly literate adults

High wages

High leve

ls of p

olitica

l effica

cy

Particip

ation in vo

lunteer acti

vities

High leve

ls of t

rust

Being employed

Good to exc

ellent h

ealth1.0

1.2

1.4

1.6

1.8

2.0

2.2

2.4

2.6

2.8

3.0

International averageOdds ratio

Diagnosis of TVET in Latin America

Evolution of educational coverage in Latin America

1980 2000 2012

Educational coverage has improved in Latin America in the last 30 years, however there is still a lag in terms of quality of education and generation of

skills and competencies of the workforce compared to those required by companies.

Main problems of TVET in LA:1. From coverage to quality:

Fuente: OECD, PISA 2012.

Main problems of TVET in LA:1. Low quality of education

7580859095100105110115120125375

400

425

450

475

500

525

550

575

600

Average performance in problem solving is below the OECD averageAverage performance in problem solving is not statistically different from the OECD averageAverage performance in problem solving is above the OECD average

Aver

age

perf

orm

ance

in p

robl

em s

olvi

ng (i

n sc

ore

poin

ts

Above-average problem-solving performanceAbove-average variation in performance

Above-average problem-solving performanceBelow-average variation in performance

Below-average problem-solving performanceAbove-average variation in performance

Below-average problem-solving performanceBelow-average variation in performance

Ave

rage

OEC

D

Promedio OECD

Average performance in problem solving and variation in performance

Standard deviation in problem-solving performance(in score points)

Source: Enterprise Survey, 2010

The demand of business services

Main problems of TVET in LA:2. Gap between demand and supply

According to World Bank figures, almost 37% of companies in the region believe that finding a workforce with adequate training is one of their main obstacles.

Tribunales

Acceso a tierras

Administración fiscal

Licencias y permisos empresariales

Transporte

Regulaciones laborales

Regulaciones aduanales y comerciales

Inestabilidad Política

Corrupción

Crimen, robo y desorden

Electricidad

Tasas impositivas

Fuerza laboral inadecuadamente capacitada

Prácticas del sector informal

Acceso a financiamiento

0 2 4 6 8 10 12 14 16

Access to finance

Informal sector prac-tices

Inadequately educated work-force

Tax rates

Electricity

Crime, theft and disorder

Corruption

Political instabil-ity

Customs and trade regula-tions

Labor regula-tions

Transport

Business licenses and per-mits

Fiscal administra-tion

Access to land

Courts

Source: OECD, PIAAC 2012

Main problems of TVET in LA:Trends in the demand for skills

1979 1986 1992 1999-20

-15

-10

-5

0

5

10

15

20

25

30

Non-routine analytic Non-routine interactive Routine cognitive Routine manualNon-routine manual

Percentage-point change in aggregate task inputs relative to 1979

Germany

Percentage change

1960 1970 1980 1990 2000 200934

38

42

46

50

54

58

62

66

70

74

Percentage change

United States

1960 1970 1980 1990 2000 2005-1.50

-1.25

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

Percentage change

Japan

Fuente: Diagnóstico sobre ETFP, CAF

Main problems of TVET in LA:3. Low investment of companies

International companies, exporters, large and innovative give more formal training than national, non-exporting, small and medium and not innovative.

Arge

ntina

Boliv

ia

Bras

il

Chile

Colo

mbi

a

Cost

a Ri

ca

Ecua

dor

El S

alva

dor

Gua

tem

ala

Hon

dura

s

Méx

ico

Nic

arag

ua

Para

guay

Perú

Rep.

Dom

inic

ana

Uru

guay

Vene

zuel

a0.010.020.030.040.050.060.070.080.090.0

100.0

Percentage of companies that deliver formal training by company size

Empresas grandes (200+) Empresas medianas (20-99) Empresas pequeñas (1-19)Small companies (1-19)Medium companies (20-199)Large companies (200+)

Recommendations to overcome the challenges in Latin America

Recommendations for Latin America

1. Institutional weakness of TVET systems:• Formulation of a strategic framework, sectoral convergence and coordination of public policies: the different areas of government must converge in their strategic objectives and articulate their programs and action plans in an efficient and coordinated manner.

• Institutional strengthening of TVET management: assigning distinct functions according to three institutional levels: one strategic and rector of the system, one for administration and management, and one provider of educational services and vocational training.

• Business participation: encourage private participation and involvement in the development of sector plans, cluster or value chains, as well as curriculum design and definition of competencies.

• Cluster and territorial approach, SME support and development of quality assurance schemes, monitoring and evaluation.

2. Low quality of education:

• Teacher training in specific technical skills.

Recomendaciones para América Latina

3. Gap between supply and demand of labor skills:

• Integration of the education and training system: integration of curricula that interrelate the initial training, continuing education, adult education and non-formal education; coordination of training of teachers in both systems, among others.

• Enterprise training: implementation of educational experiences that combine theoretical classroom learning and experiential learning in enterprises (dual training).

4. Low investment in training by firms:

• Design of incentives and other mechanisms to encourage higher levels of training in businesses, for example, tax incentives, creation of funds for the development of human capital, etc.

Main recommendation: promoting competencies (qualifications) certification as a mechanism for comprehensive solution of linkage between sectors and processes.

Source: Irigoin y Vargas, “Competencia Laboral. Manual de conceptos, métodos y aplicaciones”, Cinterfor/OIT (2002).

System of training and certification of competencies

System management:Scenario where the tripartite social dialogue and agreement process is verified on the legitimacy and representativeness of the system.

Government sector

Labor sector

Employer sector

Sectoral level: Comprised of employers and workers in a specific sector. Development of performance standards and certification. Quality assurance.

Sector 1 Sector 2 Sector 3

Operational level: Institutions for training of workers, evaluation and certification.

Training role

Evaluation roleCertification role

CAF Program on Education for Productivity

Education for productivity - CAF

Main objectives:

Promote TVET as a driver of business innovation and productivity growth in competitive industries.

Bridging the gap between supply and demand for TVET, in order to promote flexible training systems and demand-driven and sustained competitiveness in businesses.

1

2

Education for productivity - CAF

Program components:

1

Investment in infrastructure and institutional strengthening

Promotion of systems for competencies certification

Training and retraining of teachers

Introduction of innovative models - public private partnerships

Adoption of information systems and quality assurance

2

3

4

5

Study case: main conclusions of KSP-CAF joint program on TVET in

Panama

National

Issue 1: Adoption of Qualification System for the 3 Main Industry Sectors

- S1: 3 Main industry sector should first be organized as a foundation for the

development of qualification system for the 3 industry sectors

- S2: TVET system for the 3 sectors should be improved continuously to align it

with operation of the qualification system

Policy Recommendations for TVET of three main industries

Logistics

Issue 1: Adoption of the Converged Education and Training Systems

- S1: The Curriculums and the Programs should be Restructured and operated,

reflecting characteristics of logistic industry

Issue 2: Adoption of Life-long vocational training system for workers

- S1: To provide a life-long vocational training system for employees of the

logistics sector of Panama

Tourism

Issue 1: lack of strategic plan reflecting environmental change

- S1: Maintaining the global service quality by strengthening the qualification system

for employees in the private sector

issue 2: lack of strategic plan reflecting regional characteristics

- S1: Retraining the government officers to become specialized manpower

- S2: Expanding the roles of universities through region-based industry-academia

cooperation

Agriculture

Issue 1: Increasing import of agricultural product’s because of low productivity

- S1: Expand a production of agricultural product’s with high added value

- S2: Innovation TVET system in agriculture applying NCS and NQF

Issue 2: Low industry growth rate and weak profit structure

- S1: National level Policy for improving quality of life and increasing income for

agricultural communities

- S2: Paradigm shift to the ’6th industry’ from the traditional agricultural industry

Policy Recommendations for TVET of three main industries

Más oportunidades, un mejor futuro.

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