Posts Tagged ‘skills development’

In so far as a similar global economic development narrative based on the transition to knowledge-based economies and accompanying high wage, high skill jobs was perpetuated by the engagement of the World Bank and UN with the Arab World in the early Nineties, a similar opportunity bargain as that in the West emerged in the Arab countries. In addition to high skill, high wage job creation, however, the Arabization of the concept of knowledge-based economy infused economic development with a host of other development issues such as economic integration and diversification, innovation, entrepreneurship, education and training system reform, environmental sustainability, identity, language, gender equality, and political participation and democratic reform. With its association to human capital development, the concept of knowledge-based economy created a convincing economic development narrative that met the psychological needs of Arab citizens but, as evidenced by the Arab Spring, clearly missed the mark on delivering on physiological needs.

Broken Promises of the Arab Opportunity Bargain

Although there are few regional public opinion surveys that can provide an indicator of the effectiveness of Arab governments to deliver on the opportunity bargain that has become enmeshed with the Arab Dream, a recent survey of 16,000 citizens across 21 countries in the Arab World shows several sources of breakdown. Carried out in late 2010 and early 2011 before the Arab Spring reached it boiling point, the survey provides a baseline indicator of several seeds of discontent that point towards unfulfilled promises associated with the pursuit of knowledge-based economy in the Arab World and a broken Arab opportunity bargain. Particularly in the less wealthy Arab countries outside the Gulf, respondents described an Arab World that is not amenable to finding employment; lacks effective education systems; which offers few opportunities for youth to get ahead through hard work; faces a dismal outlook for economic growth; and offers a difficult path to reaching life milestones such as securing affordable housing (Silatech 2010). In many countries, citizens indicate that they would prefer to migrate to realize their dreams elsewhere.

Securing a Viable Arab Dream

How Arab governments respond to the broken regional opportunity bargain following the Arab Spring could make the difference between a lost generation of youth plagued by chronic unemployment and social marginalization as well as significantly impact future generations. Disaffected youth have the potential to become a perpetual thorn in the side of Arab nations as youth bulges experiencing economic hardship have been linked with political violence. Discontent amongst Arab youth based on an evolving opportunity bargain that no longer promises free education, a public sector job guarantee, and state support could severely compromise ambitious economic development plans.

The Arab Spring was in part a result of people buying into the Arab Dream, investing their time and money in education, but then subsequently finding that their credentials and hard work does not allow them to  fulfill their dreams of gainful employment and achievement of accompanying social and economic advancement. The Arab Dream is grounded in a regional pursuit of knowledge-based economic development driven by policies that envision the emergence of high skill, high wage economies that will create jobs. However, the global availability and growth of low cost, high skill workers potentially threatens the viability and economic fundamentals of sophisticated, innovation-driven knowledge-based industries taking root in the region and devalues the credentials of skilled workers. If knowledge-based industries fail to take root and lead to employment, many of reforms and money spent on higher education expansion, education quality, R&D ecosystems, and entrepreneurial growth could be deemed inappropriately spent.

The Arab Spring was a very tangible reminder that securing a viable Arab Dream is a major issue of concern to regional governments. The Arab Dream must include a revised opportunity bargain which factors in how the marginalized whose voices came to a boil in the Arab Spring can have access to livelihoods. Creating this opportunity bargain requires not just benchmarking and replicating the economic development trajectories of  wealthy, developed countries but also being aware of the vulnerability Arab economies face in an era of globalization and the emergence of high skill, low wage knowledge workers that have changed the fundamentals of knowledge-based industries.

While some Arab countries are more suited to competing in a high skill, low wage global economy, other Arab countries which are unable to compete in high skill, high wage knowledge-based industries will need to adequately calibrate the expectations of their citizens regarding the types of jobs which will be available in the future and the likely instability of salaries due to wage compression from competing low wage, high skill workers. Efforts to privatize education attainment so that labor market success or failure passes the burden on to individuals are prone to market failure without sufficient demand for skills from the labor market. Short term, quick fix government payouts to solve the problems with the broken Arab opportunity bargain are also likely to fail. Arab governments will have to take a hard look at the economic counsel they have received over the last two decades to judge its worth in securing the economic interests of the region. Reforms to reinvigorate the Arab Dream must challenge the assumption that more education is always the answer, reconsider the full employment promise which hampers global competitiveness, reduce wage inequality to ensure equal distribution of wealth, and determine the Arab world’s position in an global economy with emerging low cost, high skill competitors that challenge knowledge-based economic development both in the developed and developing world.

Related Work

Rethinking Arab Knowledge-based Economies

Value for Money in Arab Educational Reform

How Skills Surveys Can More Effectively Identify Workforce Skills Gaps

In the Arab World, a society characterized by skilled, flexible, and innovative individuals nurtured through quality education, employment, and broadly accessible life-long learning opportunities is seen as a vital precursor to knowledge-based economic development (Kingdom of Saudi Arabia Ministry of Economy and Planning, 2010). To varying degrees, Arab countries are faced with similar human capital challenges that serve as obstacles to knowledge-based economic development:

Low Levels of Workforce Productivity

Across the region, labor productivity is low. Based on GDP per person employed data from 2008, Qatar, the richest Arab nation, is approximately two-thirds as productive as Organization for Economic Cooperation and Development (OECD) countries, despite the upward trending of oil and gas which forms the majority of Qatar’s domestic product receipts (World Bank, 2010a). Labor productivity data from 1991-2008 show a .7% compound annual growth rate for the Arab World while East Asia and the Pacific grew at 3.97%; Latin America grew at a rate of 1.19%; Sub Saharan Africa grew at 1.46%, and the OECD countries grew at 1.54%.

Preference for Public Sector Employment

Long standing social aspects of career specialization have led to some reluctance to pursue certain professions (United Nations Educational, Scientific, and Cultural Organization, 1960). The social aspects of career choice has slowed economic integration, led to the substitution of expatriate labor in certain industries, and decreased productivity in low value added industries for which low skill expatriate labor is imported from abroad to perform (Ministry of National Economy of the Sultanate of Oman, 2010). The social preference for public sector jobs has precipitated a crisis in which regional governments are unable to create suitable employment opportunities to absorb the youthful population entering the labor market.

Increasing Female Labor Market Participation

Despite significant gains in educational attainment, female labor market participation is estimated at 22% resulting in high levels of female unemployment (International Labor Organization, 2010). While more women have entered the labor market, many have found employment in part-time work, microenterprises, and the informal economy (Flynn and Oldham, 1999). Rapidly evolving cultural values and changing views on familial obligations continue to be influential in labor market participation and obtaining higher levels of education (Miles, 2002).

Poor Match Between Workforce Skills and Those Demanded by Public and Private Sector Employers

In surveying the public sector, Al-Yahya (2008) finds evidence of a low match between the skills of public sector employees and the work roles they perform particularly at lower administrative levels. Al-Yahya also finds evidence that formal educational qualifications are frequently not related to current jobs and a high number of public sector employees who believe their current jobs require low levels of their perceived skills and capabilities. Citing deficiencies in soft skills like communication, teamwork, analytical skills, and innovative thinking, a recent survey of the private sector also found that 46% of regional CEOs do not believe that education and training systems in the Arab World prepare students for the workplace (Mohammed bin Rashid Al Maktoum Foundation, 2008). These findings are indicative of a vast disconnect between current regional human capital levels and the skills demanded by private sector employers.

Education and Training System Misalignment With the Needs of Knowledge-based Economies

Many Arab countries are unable to meet the needs of all students who want to pursue education because of dramatic increases in student enrollment and insufficient resources (United Nations Development Program, 2002). Though there is a continued long-term trend towards increased budgets for education in the region, meeting the combined demands of increased access, assuring relevance, and improving quality in the face of finite resources is challenging (United Nations Educational, Scientific, and Cultural Organization, 2010b). Despite positive gains to promote educational opportunity and increased national spending on education, poor educational quality continues to hamper regional human capital development and the ability of Arab countries to compete in the global economy. At the higher education level, the region’s education systems are failing to produce the right quality and mix of human capital needed for knowledge-based development.

Barriers to Entrepreneurship

While some gains have been made in facilitating entrepreneurship in the region as evidenced by the increasing number of new business registrations, the procedures, time, costs, and minimum capital required to start a business remain much higher than OECD countries (Klapper, 2010, World Bank, 2010b). Though some Arab countries provide venture funding for entrepreneurial endeavors, startup and early-stage financing from banks, venture capitalists, and angel investors is very limited in the Arab World due to low liquidity conditions on exit markets. In terms of nurturing businesses, the Arab World has approximately 100 business incubators as compared to 1,600 in the United States to serve rather similar populations (National Business Incubation Association, 2011).

Weak Innovation Systems

R&D spending is significantly lower than in the developed world with very little private sector funding (United Nations Educational, Scientific, and Cultural Organization, 2010a). Regulatory frameworks do not protect intellectual property leading to low levels of patents and stifling private R&D expenditure. There is weak government policy making in research and innovation in spite of various studies which have shown that critical components necessary for innovation systems, research, market-oriented R&D, and entrepreneurship need to be concurrently fostered and linked in knowledge-based economies (Cooke, 2001, Pietrobelli, 2009). These components include educational systems, institutions conducting basic, applied, and interdisciplinary research, business incubators, funding institutions, and professional societies. Several of the institutions critical to the innovation system are weak in the Arab World (Mohammed bin Rashid Al Maktoum Foundation, 2009).

Managing Growth Sustainably

Underpinned by high fertility rates and increased life expectancy, the population of the Arab World nearly tripled to 359 million growing at an average annual rate of over 2% from 1970 to 2010 (Mirkin, 2010). This growth has increased the demand for basic services such as health, education, housing, water, and sewerage systems which has outpaced the growth rate of national income and government revenues (Rischard, 2009). The Arab World is experiencing rapid urbanization which has resulted in increased poverty, inadequate solid waste collection and disposal, toxic and hazardous waste problems, poor or non-existent sanitation facilities, and degradation of urban environment and coastal areas (United Nations Economic and Social Commission for Western Asia, 2009). Demographic trends are also having a number of societal implications related to marriage and the family, status of women, and care of older people (Mirkin, 2010).

Knowledge-based economic development has become closely intertwined with national competitiveness and economic policies that support integration and diversification, innovation, technology development, entrepreneurship, workforce skills development and job creation, adoption of high performance organizational structures, and ICT infrastructure development (Planning 2010). Through the engagement of international organizations such as the World Bank and the UN with the region, the concept of knowledge-based economy has taken on an expanded meaning in the Arab region. The Arabized concept of knowledge economy is also fused with other development challenges not part of the Western conception of the term such as large-scale education and training system reform; environmental sustainability; social and cultural development including issues surrounding identity, language, equality; political participation and reform; and healthcare reform (Program 2002; Program 2003; United Nations Educational 2005; Bank 2007; Foundation and Program 2009).

 

Influenced by the gradual adoption of knowledge-economy as a widespread regional policy goal beginning in the early 1990s and the work of international organizations, in January 2007 the Planning Council of Qatar and Qatar Foundation sought the assistance of the World Bank to perform a knowledge economy assessment and articulate a vision for Qatar. At the time, a background analysis for the World Bank report observed the following education and training issues “few links and formal relationships between the training institutions and the needs of the labor market; education and training institutions are highly separated with little coordination; no linkages between training and job career prospect; and most of the training centers lack human and financial resources. In general, there is a lack of an overall strategy for workforce development in Qatar (Institute 2007).”

 

The Qatar National Vision 2030 advances a broad vision for the education and training system: “Qatar aims to build a modern world-class educational system that provides students with a first-rate education, comparable to that offered anywhere in the world.” The National Development Strategy 2011-2016 describes the underlying thrust of the education and training system in both economic and socio-cultural outcomes. In terms of fostering economic development towards a diversified, knowledge-based economy, innovation in science, medicine, and industry is emphasized along with upgrading and deepening the education, knowledge, and skills of Qataris for increased private sector employment participation. In terms of catalyzing socio-cultural outcomes, the skills formation system is linked with outcomes  such as religious, moral, and ethical values, national identity, preservation of traditions and cultural heritage, a well-rounded and engaged citizenry, a cohesive, participatory society, improved decisions about health, marriage, parenting,  and social responsibility (Planning 2011).

 

Primarily receiving technical assistance for institutional capacity development as aid from international organizations, the Qatari government, through the Supreme Education Council, serves as the regulator, provider, and funder of the education and training system while playing a strong role in defining industrial economic development policy. Thus, the Qatari government is in a unique position of coordinating education and training outputs with economic development needs without relying on external financial assistance. In this respect, the Qatar National Vision sets three system-wide education and training policy objectives to achieve world-class standards:

Education and Training System Policy Principles in Qatar

These policy principles are at the heart of the advanced performance management framework for K-12 education system reform that aligns ministry and sector strategies with the development goals established by the Qatar National Development Strategy 2011-2016 and the Qatar National Vision 2030

By defining specific policy areas for education reform, a performance management framework was devised to track delivery upon goals set out in the National Development Strategy at two levels to ensure that  empirically supported socio-cultural and economic benefits attributable to education and training are achieved:

  • Policy-based key performance indicators measure system performance relative to the achievement of the overarching policy aims of quality, equity, and portability;
  • Output KPIs measure the effectiveness of the education and training system in terms of achieving academic, social, and economic outcomes which are precursors to the future development of Qatar.

Tahseen Consulting’s Related Work

Through the engagement of international organizations with the region, the concept of knowledge-based economy has taken on an expanded meaning in the Arab region. The Arabized concept of knowledge economy is fused with other development challenges not part of the Western conception of the term such as large-scale education and training system reform (UNDP, 2002; UNDP, 2003; UNESCO, 2005; World Bank 2007; MbRAM Foundation and UNDP, 2009). Influenced by the gradual adoption of knowledge economy as a widespread regional policy goal beginning in the early 1990s, in January 2007 the Planning Council of Qatar and Qatar Foundation sought the assistance of the World Bank to perform a knowledge economy assessment and articulate a national vision. At the time, a background analysis for the World Bank report observed the following education and training issues: “few links and formal relationships between the training institutions and the needs of the labor market; education and training institutions are highly separated with little coordination; no linkages between training and job career prospects; and most of the training centers lack human and financial resources. In general, there is a lack of an overall strategy for workforce development in Qatar (World Bank Institute, 2007).”

To address these challenges, the Qatar National Development Strategy 2011-2016 (Qatar General Secretariat for Development Planning, 2011) sets three system-wide education and training policy objectives: quality, equity and inclusiveness, and portability and mobility. Primarily receiving technical assistance for institutional capacity development as aid from international organizations, the Qatari government, through the Supreme Education Council, serves as the regulator, provider, and funder of the education and training system while playing a strong role in defining industrial economic development policy. In line with the Paris Declaration, Qatar is currently in the process of establishing results-oriented reporting and performance assessment frameworks to more effectively manage increased resources devoted to the education and training sector. These frameworks are aimed at using information on results to improve implementation of reforms, policy making, increase transparency, and assess progress against national and sectoral development strategies.

By defining specific policy areas for education reform, we devised a performance management framework to track delivery upon goals set out in the National Development Strategy at two levels to ensure that empirically supported socio-cultural and economic benefits attributable to education and training are achieved:

• Policy-based key performance indicators measure system performance relative to the achievement of the overarching policy aims of quality, equity, and portability;

• Output KPIs measure the effectiveness of the education and training system in terms of achieving academic, social, and economic outcomes which are precursors to the future development of Qatar.