Investing in Human Capital: A Matter of Urgency

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Investing in Human Capital A Matter of Urgency
by Arjen Vos 8th CEI Summit Economic Forum,
Bratislava, 23 November 2005
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• Structure of presentation
• Some key issues of education training in the EU
• Investing in education training
• Education training and migration

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• Assessment of Lisbon Goals
• EU is weak on competitiveness and performance
• Disappointing economic and employment
  developments
• Lisbon goals unachievable without more action and
  innovation at EU and at national level

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• Competitiveness and Educational Attainment

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• Skills and Competences in EU
• The number of low skilled is decreasing, but in
  2004 there still are 74 million!
• By 2010 almost half of additional jobs require
  higher education and almost 40 upper secondary
  education.
• Half (100 mln) of workforce has to upskill

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• Competitiveness and Lifelong Learning
• Underperformance of EU compared to competitors
  (42 of 25-64 yrs)
• Only 5 EU Member States reach Lisbon target
• Variations between sectors and countries
• Low educated three times lower chance to training
  than higher educated (23 vs 69)

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• Competitiveness and Investments in VET
• Public expenditure in EU is with 5 of GDP
  similar to USA and is only slightly improving
• Private expenditure in USA is almost five times
  higher than in EU
• Lower costs per student in EU
• But spending is not a guarantee of quality as
  PISA shows

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• Investments in VET
• To reach Lisbon targets an overall increase in
  investments is necessary
• Increase private investments of individuals and
  companies in particular in Higher Education and
  Adult Learning
• Enhance efficiency through improving quality
  empower key stakeholders in a decentralised
  context with appropriate incentives for action

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• Quality in VET reduces early school leaving
• EU countries with high proportion of young people
  in VET tend to have high upper secondary
  completion rates and low drop outs
• The challenge on quality is
• Programmes attractive to learners and enterprises
• Flexibility focus on the learner
• Links to general education
• Pathways to higher education
• Invest in teachers

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• Education Training in the EU
• Limited acquis communautaire
• Subsidiarity principle
• Mobility and transparency
• Open Method of Coordination with common goals,
  agreed benchmarks and progress monitoring
• Policy learning No Member State can develop its
  education policy on its own

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• Lisbon and Education Training 2010
• Invest in the knowledge society invest in people
• Focussed and integrated strategy, linking growth,
  employment and investment in human capital
• Emerging innovation strategies link economic
  strategies to RD and to LLL
• Closer links between secondary and higher
  education

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• Mobility and education training
• Enlargement has not substantially increased the
  already low trans-national mobility in the EU
• Effective labour markets Right skills on right
  place at right time
• Brain drains and brain gains more analysis
  needed
• Investing in education training in sending
  countries will improve quality of migration

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• Conclusions
• Education Training much higher on political
  agenda in EU and in Member States
• Small increase in public funding, but challenge
  will be to increase private funding
• Education training is shared responsibility and
  it pays off to individuals, companies and society
• Invest now in innovation and knowledge society!

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• www.etf.eu.int
• www.cedefop.eu.int
• www.europa.eu.int/comm/education