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4 Factors determining real convergence

4.5 Human resource development

The competitiveness of an economy depends, as noted above, not only on its physical capital, but also on the knowledge possessed by its entrepreneurs and labour force. Effective educational and training systems are, therefore, important for raising productivity and fostering economic growth. There are, however, striking differences in education and training across Europe.

Significant variations in educational attainment levels between Member States

Despite the gradual reduction of educational disparities over the past 30 years, there is still a large gap in educational attainment levels between the cohesion countries and the rest of the Union. In particular, in the former a large proportion of the population aged 25 to 59 has only a low education level, ie no educational qualifications beyond compulsory schooling (1999: 75% in Portugal, some 65% in Spain and around half in Greece and Ireland). The same is true for Italy, where more than half of those in this age group have low education.

By contrast, in the three Nordic countries, Belgium and the UK, more than a quarter of those aged 25 to 59 has a high (or tertiary) level of educational attainment (university degree or the equivalent)(see Map 12).

The applicant countries: higher educational needs than figures indicate

In the Central European candidate countries, a large proportion of the population aged 25 to 59 has an upper secondary level of education, particularly in the Czech Republic and Poland, where the figure is over 70%.

Recent studies, however, offer a less optimistic assessment and suggest that the high proportion of people with educational attainment levels beyond elementary schooling is mainly due to lower vocational schools offering a basic form of training: 'The fact of having a relatively high number of workers with educational attainment above elementary schooling was mainly a by-product of the presence in these countries of lower vocational schools offering generally one to two years of training in narrowly defined occupations up to the completion of compulsory schooling. These lower vocational schools were actually part of the basic schools and were indeed not even formally considered as part of the secondary system of these countries.1 In addition, there is a question mark over the quality and nature of vocational training at upper secondary level, which in many cases seems outdated. This underlines the need for developing appropriate human resources strategies in these countries in order to avoid low skills slowing down economic and social development.

Growing number of qualified young people

Technological advance and continuing globalisation are increasing the demand for skilled labour. The educational attainment level of young people in the EU has been rising continuously for the past 30 years or more. In 1999, only 27% of young people aged 25 to 34 in the EU had no qualifications beyond compulsory schooling as compared with 48% in the in the 50 to 59 age group. Similarly, 49% of those aged 25 to 34 had upper secondary level education as against only 35% of the 50 to 59 age group, while 24% of 25 to 34 year-olds had a university degree or equivalent as opposed to 17% of those aged 50 to 59. It is expected that the number of people enrolled in higher education will double in the next ten years and this will strain the higher education systems in Europe.

The increase in educational attainment levels is evident in all Member States. It is particularly marked in the cohesion countries, as well as in Italy, where average education levels of older people are relatively low. The proportion of 25 to 34 year olds in the cohesion countries with an upper secondary level qualification in 1999 was twice as high as among those aged 50 to 59 and the difference was similar in the case of tertiary education(Graph 12). As a result, the gap in attainment levels between Member States is narrowing.

At the same time, there is a stronger upward trend in the education attainment levels of women than men and in almost all Member States women in the younger age groups have attained a higher level of education than their male counterparts.

Nevertheless, the number of young people who leave the education system prematurely with only the most basic skills is still substantial; these young people are unable to respond adequately to the demand of a continuous updating of knowledge and competencies throughout life, which is needed due to the accelerating pace of technological, scientific and economic evolution of society.

In the European Union, an average of 22% of young people between 18 and 24 years old only acquire lower secondary education at most.2 Some Member States lie significantly above this average. Furthermore, there are also alarmingly high rates in certain urban or peripheral areas as well as in disadvantaged social groups.

The problem is most serious in Portugal where over 45% of 18 to 24 year-olds fail to go on from compulsory schooling to further education or vocational training.

In the learning society, social stratification is increasingly based on a division between the haves and have-nots in terms of skills and qualifications. Dropping out from school, therefore, has much more lasting consequences than it had in the past, since it can mark an individual for life and greatly narrow the range of career choices open to them. Schools are at the centre of the learning society and life-long learning begins there.

Failure at school affects all sections of society, but not all equally. Surveys show that those dropping out of school come predominantly from low-income families where there is a history of failure. Many come from broken homes or from immigrant or refugee families which have not integrated successfully. Dropping out of school is, therefore, related to a range of social, health, family and financial factors. Although it is only one element of a cumulative process of social deprivation, it is often the critical one which deprives young people of the skills, qualifications and social contacts required to succeed or even to play a meaningful role in society.

The fight against school failure is at the heart of the debate on educational reform; it is essential for sustaining a knowledge-based economy and for maintaining a cohesive society and a democracy in which everyone can participate.

An increase in education level is also evident in the candidate countries. In most of them, the proportion of people aged 25 to 34 with upper secondary education is significantly higher than among those aged 50 to 59 years, though the proportion with tertiary level education is much the same and remains relatively low among young people. Enrolment rates in universities are, therefore, in general significantly lower than in the EU.

Employment prospects rise with level of education

In almost all EU Member States, the level of education is an important determinant of finding employment. Except for Greece, and to a lesser extent Portugal, unemployment in the EU is much lower among those with high educational attainment levels than those with lower ones. In 1999, the average rate of unemployment of those aged 25 to 59 with a tertiary level of education was 5% as against 8% for those with upper secondary level and 12% for those with only basic schooling. In some Member States, unemployment rates of people with low education was 3 to 4 times higher than for those with high education (Graph 13).

The link between education and employment rates is even closer, especially for women. This is because a large proportion of women with low education - and a significant proportion of men - are not part of the labour force at all. In other words, education levels affect not only the chances of being unemployed, but also of being economically active.

A similar pattern is evident in the candidate countries. The difference in unemployment rates between those with differing levels of education is very marked in the Czech Republic, Hungary, Poland and Slovakia, where those with a low educational attainment level are up to 7 times more likely to be unemployed than those with a high attainment.

In Greece, Spain and Italy, in particular, as well as in most of the candidate countries, however, a significant number of young people aged 25 to 34 with a high level of education have difficulty finding a job after completing their studies, which contrasts sharply with the position of older people with similar qualifications.

It should also be emphasised that differences in employment prospects between men and women persist. Women with a given level of education are more likely to be unemployed than men with a similar level in most parts of the EU. Inequalities are particularly marked in Greece, Spain and Italy. By contrast, in most of the candidate countries, women seem to be in less of an unequal position than in the EU.

Finally, it should be noted that there is a clear positive relationship between levels of educational qualifications and earnings. In all Member States, those employed full-time with tertiary education earn significantly more on average than those with upper secondary education. The difference is over 50% in Germany, France and Austria, and 100% in Portugal. The difference in earnings between those with upper secondary and those with lower secondary education is much less in most Member States (10-20%), but still significant.

Access to continuing training still varies markedly between Member States

Continuing education and training are essential both for the job prospects of individuals and for maintaining the competitiveness of a modern economy. While indicators suggest that participation in job-related training for those in employment has increased throughout Europe, they also show that participation in training is still relatively low and that there are still large disparities between Member States. In 1999, only just over 10% of employees in the EU covered in the Labour Force Survey (LFS) had undertaken any training at all during the previous four weeks. Participation rates vary from under 5% in around half the Member States to over 20% in Netherlands, Denmark, Finland and Sweden (in 1999). Although these figures involve a high degree of uncertainty and are not fully comparable between countries, they indicate that access to training is almost certainly less in the cohesion countries than elsewhere.

Although it took no account of the quality and relevance of training, a recent OECD survey suggests that the duration of job-related training also varies significantly between the countries covered. Annual hours of training undertaken by employees, therefore, ranged from 27 in Belgium (Flanders only) to 57 in the Netherlands.3

LFS evidence suggests in addition that younger workers tend to receive more training than older ones. Whereas only 2.5% of those aged 55 to 59 in the EU had participated in training or education in the reference weeks, the figure for those aged 25 to 29 was 10% and for those aged 30 to 34, 8%. Moreover, there seems to be a clear link between educational attainment levels and access to training, in all Member States, those with high education having much more opportunity to receive training than those with lower levels. Greater efforts are, therefore, needed to prevent the problems of people with low initial education being compounded by having only limited access to continuing training.

Adaptation of educational systems to ICT has started, but still has some way to go

For students to make a smooth transition into the modern labour market, they need to be exposed to information and communications technology (ICT) in school. Although the integration of ICT into the education system is becoming increasingly widespread across the EU, as Member States implement the conclusions of the Lisbon Council and the eLearning initiative which called for a strengthening of ICT in systems of educationICT is included in the primary and lower secondary curriculum in the majority of EU and candidate countries. The extent of progress in this area is, however, difficult to assess. While national data exist, there are no EU harmonised data available.

A pilot OECD study suggests that access to ICT in education, measured by the number of students per computer, varies significantly across the EU4. While primary schools in Finland, Sweden, and Denmark typically have between 11 and 14 students per computer, the figure in Italy and Portugal ranges from 50 to 150. In secondary schools, whereas there are an average of 7 students per computer in Sweden, Finland and Ireland, in Portugal, the figure is 65. In both primary and secondary schools, access to computers is lower in almost all Member States than in the US.

  1. See study on "the impact of eastern enlargement on employment and the labour market in the EU member states" (part B strategic report, chapter 3.3)
  2. Source: Eurostat, Labour Market Survey 1998
  3. See OECD: Education at a Glance 2000, p.195ff.
  4. See OECD: Education Policy Analysis 1999, p.49ff. The study only provides 1997/98 data for the following 10 EU Member States: Belgium (Flemish Community), Denmark, Finland, France, Ireland, Italy, Netherlands, Portugal, Sweden, UK.

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