The document discusses the importance of developing competences and skills to address global competition, high unemployment, and an aging population. It outlines a strategic approach for governments to enhance skills policies through efficient education and training expenditure, fostering lifelong learning, and promoting equity in education. The document highlights the dynamic relationship between skills supply and demand, providing insights on how countries can maximize the use of skills to boost employment and economic growth.

1. Strategic approach to skills
policies
LÁSZLÓ HORVÁTH
horvath.laszlo@ppk.elte.hu

2. Why develop competences?
• „skill” and „competence” are used interchangeably
• skill/competence = the bundle of knowledge, attributes and capacities that
enables an individual to successfully and consistently perform an activity or task,
whether broadly or narrowly conceived, and can be built upon and extended
through learning (OECD, 2011)
• „Students cannot learn everything in school they will need to know in adult life.
What they must acquire is the prerequisites for successful learning in future
life.” (OECD, 1999)

3. Importance of skills (OECD, 2012)
Global competition High unemployment Aging population
adequate supply of
skills
maximizing skills
use
optimizing further
development
boosting
employment and
economic growth
promoting social
inclusion

4. Strategic approach
• education and training ~13% of total public expenditure
• Governments must ensure that expenditures are efficient and effective and appropriately shared
• to facilitate a cross-governmental approach and peer learning on effective skills policies
• to address the global dimension of the supply and demand for skills
OECD Global Skills Strategy to help:
 responsiveness (education/training providers can adopt to changing demand)
 quality and efficiency in learning provision (ensuring that right skills are acquired at the right time, right place
and in the most effective mode)
 flexibility in provision (allow to study what/when/how they want)
 transferability of skills (gained skills are documented in a commonly accepted/understandable form, skills
acquired over the course of the working life are recognized and certified)
 ease of access (reducing barriers to entry)
 low-costs of re-entry (granting credits for components of learning, modular instruction, credit accumulation and
transfer) (OECD, 2012)

5. Skills ecosystem
• Goes beyond the traditional „educational output should be equal to the demands of the labor
market” paradigm!
• skills supply (skills formation) and skills demand (skills use) are in a dynamic relation influencing
each other -> workplace need skills, skills make workplaces = skills ecosystem
• toxic co-existence of unemployed graduates and employers who can’t find people with the skills
they need (low-skill equilibrium)
• Skills do not automatically translate into better economic and social outcomes! (OECD, 2012)

6. How can a country maximize its use of
skills? (OECD, 2012)
A COUNTRY CAN DEVELOP THE RELEVANT SKILLS
By encouraging and enabling people to learn throughout life
•Gather and use evidence about the changing skills demand to guide skills development.
• Engage social partners in designing and delivering education and training programmes.
• Ensure that education and training programmes are of high quality.
• Promote equity by ensuring access to, and success in, quality education for all.
• Ensure that costs are shared and that tax systems do not discourage investments in learning.
• Maintain a long-term perspective on skills development, even during economic crises.
By fostering international mobility of skilled people to fill skills gaps
• Facilitate entry for skilled migrants and support their integration.
• Design policies that encourage international students to remain after their studies.
•Make it easier for skilled migrants to return to their country of origin.
By promoting cross-border skills policies
• Invest in skills abroad and encourage cross-border higher education.

7. How can a country maximize its use of
skills? (OECD, 2012)
A COUNTRY CAN ACTIVATE THE SUPPLY OF SKILLS
By encouraging people to offer their skills to the labor market
• Identify inactive individuals and the reasons for their inactivity.
• Create financial incentives that make work pay.
• Dismantle non-financial barriers to participation in the labour force.
By retaining skilled people in the labor market
• Discourage early retirement.
• Staunch brain drain.

8. How can a country maximize its use of
skills? (OECD, 2012)
A COUNTRY CAN PUT SKILLS TO EFFECTIVE USE
By creating a better match between people’s skills and the requirements of their job
• Help employers to make better use of their employees’ skills.
• Tackle unemployment and help young people to gain a foothold in the labour market.
• Provide better information about the skills needed and available.
• Facilitate internal mobility among local labour markets.
By increasing the demand for high-level skills
• Help economies to move up the value-added chain.
• Stimulate the creation of more high-skilled and high value-added jobs.
• Foster entrepreneurship.

9. Skills outlook
Program for the International Assessment of Adult Competencies (PIAAC): literacy, numeracy, problem solving in
technology-rich environment
Around 166.000 adults aged 16-65 in 24 countries from 1 August to 31 March 2012
Results:
• 4,9%-27,7% of adults proficient only at the lowest levels in literacy; 8,1%-31,7% in numeracy, 7%-23% in problem
solving
• older adults generally have lower proficiency (varies among countries!)
• gender gap difference in proficiency is negligible
• 21% of workers are over-qualified; 13% under-qualified
• proficiency is closely related to age (peak at around 30); labor market participation, employment, higher wages
• those with lower levels of proficiency are more likely to report poor health, believe they have little impact on
political process, not participate in volunteer activities, have lower levels of trust (OECD, 2013)

14. Skills Snapshot - Hungary
Developing the relevant skills
• PISA 2009 slightly above the OECD average in reading and science, slightly below the OECD
average in mathematics
• 7% participated in continuing non-formal education (OECD average: 34%)
• 19% of people aged 25-64 with a tertiary-level education participated in formal and/or non-formal
education (only 3% for people in the same age group with below upper secondary
education)
• 23% of employers reported recruitment difficulties (2011)

15. Skills Snapshot - Hungary
Supplying skills
• 81,3% of people aged 25-54 were in the labor force (OECD average: 81%) in 2011
• 74% of prime-age women were in the labor force (OECD average: 71%) in 2011
• 39,2% of people aged 55-64 were in the labor force (OECD average: 57,8%) in 2011
Using skills
• 18,3% is the employment rate of youth (OECD average: 39,3%) in 2011 / unemployment rate:
26,1% (OECD average: 16,2%)
• 13% of workers were over-qualified (OECD average: 25%) and 53% were under-qualified (OECD
average: 22%) in 2005

20. References
1. OECD (1999): Measuring Student Knowledge and Skills: A New Framework for Assessment.
Paris: OECD.
2. OECD (2011): Towards an OECD Skills Strategy. Paris: OECD
3. OECD (2012): Better skills, better jobs, better lives. A strategic approach to skills policies.
Paris: OECD.
4. OECD (2013): OECD Skills Outlook 2013. Firs results from the survey of adult skills. Paris:
OECD.
5. Hungary’s skills snapshot: http://skills.oecd.org/informationbycountry/hungary.html

21. Thank you for your
attention!
LÁSZLÓ HORVÁTH
horvath.laszlo@ppk.elte.hu