MOVIBES

"It was the best of times, it was the worst of times … we had everything before us, we had nothing before us "... 

Charles Dickens wrote A Tale of Two Cities in 1859. Almost two centuries later, his words remind us of what a very serious challenge inequity is.

Inequality has been growing in most OECD countries since the 1980s and is currently at its highest level in 30 years. Forecasts for 2060 suggest that gross earnings inequality could continue to rise dramatically across the OECD if current trends persist.

The widening income gap between the rich and the poor raises economic, social and political concerns. High inequality hinders GDP growth and reduces social mobility. Unequal opportunity results in a talent loss for the individual as well as for society. It also gives rise to a sense of injustice that can feed social unrest and decreasing trust in institutions and political systems. 

Inequality in education plays out in many ways. Disadvantaged students are three times as likely to be among PISA’s poor performers as children from socio-economically advantaged backgrounds. Students from advantaged families are more likely to come from home environments that are conducive to learning, including a quiet place to study and access to the Internet. In addition, their parents are more likely to have the time and ability to help them with their homework and encourage them to study. Students without these opportunities are thus disadvantaged before entering school, and continue to be disadvantaged as they go through the education system.

It has been said before but it bears repeating: greater equity in education does not come at the expense of excellence. Some of the top performers in PISA 2015 had the highest levels of equity, such as Estonia, Hong Kong (China) and Macao (China). Working to improve the educational opportunities of all students, regardless of background, is an important element in the fight against inequality. 

So what exactly can be done? An important first step is providing access to high quality early childhood education (ECEC) for all children. There is now a wealth of evidence, including longitudinal studies, that investing in ECEC yields high returns in boosting cognitive and non-cognitive skills, as well as later success in the labour market, especially for disadvantaged children.

Once in school, the quality of instruction and available resources matter. Improving the performance of disadvantaged schools is crucial: On average, advantaged schools in the OECD have lower student teacher ratios, meaning more individualised attention to each student. They also tend to have more qualified and more experienced teachers. This means that novice teachers are more likely to be placed in lower achieving and more challenging schools. 

This is a real concern. In addition to being in the classroom for the first time, new teachers can find themselves faced with the highest needs students and in the lowest achieving schools. This can lead directly to frustration and burn-out. Mentoring programmes can play a key role in supporting new teachers and school leaders on the job. But so does addressing systemic biases that work against disadvantaged schools.

The latest Trends Shaping Education Spotlight looks at what education providers can do to create school systems that provide equal opportunity for all students, regardless of their background. It offers interesting examples of how systems and schools tackle the inequality challenge. It also identifies where more effort is needed, and some common policies that should be avoided or fine-tuned, such as grade repetition and certain kinds of early tracking.

Education is and will continue to be a critical tool to ensure growth and inclusiveness in our societies. Workers’ skills, educational attainment and ability do not only determine employment and income but are also crucial for health, social and political participation and living standards. Our education systems need to ensure that all students, irrespective of social background, have equal access to opportunity in schools and in the labour market. This means shifting the focus of our schools to academic excellence as well as strengthening equity, because only when excellence and equity go hand in hand will we be able to reduce inequality.

Skills are central to the future prosperity and well-being of Mexico’s people 

Skills are the foundation upon which Mexico must build future growth and prosperity. Mexico, being one of the youngest populations among OECD countries, has a strong demographic advantage and thus a unique window of opportunity. But it also faces common challenges to bring the skills of its population up to the requirements of the global digital economy.

The time to act is now. Mexico needs to boost the development, activation and use of skills to drive further innovation and inclusive growth while dealing more effectively with longstanding, but increasingly urgent issues, such as improving equity and reducing informality. To this end, the aim of current educational reform in Mexico is a must to provide quality education to all the individuals.

However, challenges remain. According to the 2015 Programme for International Student Assessment (PISA) data many youth in Mexico are not developing high levels of skills with a very high share of students performing poorly in mathematics (56.6%), in reading (41.7%) and in science (47.8%). In addition, due to high drop-out rates only 56% of 15-19 year-olds complete upper secondary education, far below the OECD average of 84%. Similarly, on tertiary level only 16% of the population aged 25 to 64 years old in 2015 had attained tertiary education, which is significantly below the OECD average of 36%. To these outcomes, we should add the fact that young people connect with informal labour market, reinforcing the precariousness of their job opportunities. Therefore, despite recent progress, Mexico still remains in a low-skill equilibrium.

Indeed, Mexico tends to specialise in low value-added activities linked to informal employment arrangements, which are estimated to account for 52.5% of all employment. Workers in the informal economy are, on average, less likely to: receive training, participate in high performance workplace practices that make more effective use of their skills, and find themselves employed in precarious and low quality jobs. Therefore, demand-side barriers which discourage employers from hiring formally should continue to be addressed, as well as the high cost to firms for hiring low income workers, a complex tax system, and heavy labour market regulations. Targeted support will be also needed if young people and women are to enter and remain engaged in the labour market. Over one in five young people are currently neither in employment, education, or training (NEETs), risking becoming permanently marginalised - from the labour market, from education, and from society. Given the differences between boys and girls not in employment or in schools, special emphasis should be placed on women’s conditions, and to sustain their involvement with high quality jobs. Mexico cannot be losing the talent of half of its population.

More needs to be done to improve the use of skills in the workplace. There are significant skills mismatches with a quarter of workers (26%) over-educated and just under a third (31%) under-educated for their current job. Companies and educational institutions need to co-operate to reduce these mismatches at source, while firm-sponsored training could help the low-skilled. At the same time boosting innovation and research are critical if Mexican firms are to continue improving productivity, move up the global value chain, and increase the demand for higher skills. But in 2013, Mexican businesses invested the equivalent of just 0.2% of GDP in R&D. That’s not just well short of the OECD average but well below Korea’s 3.3% of its GDP investment in R&D during the same time period.

Making this all happen in practice requires concerted government action. Mexico has undertaken a number of reforms aiming to enhance the quality of teaching, raise productivity, stimulate innovation and improve integration into global value chains. Actually, one of the positive pieces of news is that productivity has increased recently as a result of recent reforms, particularly in the telecommunications market.

It is necessary to improve effectiveness of government institutions, and formal collaboration arrangements across ministries. The National Productivity Committee is good news in this sense – but much remains to be done. Yet governments cannot achieve better skills outcomes alone. Success will depend on the commitment and actions of a broad range of stakeholders. The help of employers, trade unions, students and trainers is needed. These are the people who, each and every day, invest in skills, set skills in motion and put them to work.

Best practices of other countries 

Countries that are most successful in mobilising the skills potential of their people share a number of features: they provide high-quality opportunities to learn throughout life, both in and outside school and the workplace; they develop education and training programmes that are relevant to students and the labour market; they create incentives for, and eliminate disincentives to, supplying skills in the labour market; they recognise and make maximal use of available skills in workplaces; they seek to anticipate future skills needs and they make learning and labour market information easy to find and use.

The OECD Skills Strategy provides countries with a framework for developing co-ordinated and coherent policies that support the development, activation, and effective use of skills. In Norway, our collaboration clearly demonstrated the value of a whole of government approach to tackle the country’s longstanding skills challenges. The diagnostic and action reports fed into policy measures to improve career guidance and outreach to low-skilled adults – and served as the foundations for the new National Skills Strategy to be launched this year. Portugal used our project to build broad stakeholder engagement in defining the key skills challenges facing the country as it emerged from the worst economic crisis of its history. This year we will be using our shared diagnosis to help design concrete actions to provide adult education and training across the country. Korea has built on the results of its diagnostic report and ongoing OECD support to engage actively with a wide range of stakeholders on critical issues such as youth employability and lifelong learning.

Mexico finds itself in a context with many other countries moving at a high speed. The digitalisation of the economy and the rapid pace of change require not only a good knowledge basis, but also lifelong learning and the flexibility to adapt skills to changing conditions and demands. The future of work and the capacity to anticipate the evolving needs of the markets, due to the rapid technological progress, is a common challenge that all countries are trying to address. Mexico has been participating in the OECD Skills Strategy project to work with us to advance the best practices of other countries that have been able to improve their outcomes in this field.

Mapping Mexico’s skills challenges together

Since March 2016, we have been working closely with Mexico in applying the OECD Skills Strategy framework as part of a collaborative project to build a more effective national skills strategy. The National Project Team established by the Mexican government to oversee this process is co-ordinated by the National Productivity Committee (NPC) and includes representatives from Ministry of Finance, Ministry of Education, Ministry of Labour, Ministry of Economic Affairs and the National Council for Science and Technology (CONACYT). The CNP has been critical in this process, as it embodies the spirit of partnership across government ministries and with key sectors of the economy and society as well as focuses on the nexus between productivity, inclusive growth and skills.
The results of this work are published in the OECD Skills Strategy Diagnostic Report: Mexico that sets out 8 skills challenges for Mexico. These challenges were identified in the course of several rounds of discussions with the National Project Team, technical meetings with Mexico’s leading experts and input from over 100 stakeholders such as employers, trade unions, education providers and experts including from other International Organizations, gathered during two interactive workshops held in June 2016 and September 2016 in Mexico City.

Mexico’s 8 skills challenges

So what are the main skills challenges facing Mexico today?
With regard to developing relevant skills, the report concludes that Mexico should focus on:
• Improving the foundation skills of students in compulsory education
• Increasing access to tertiary education while improving the quality and relevance of the skills developed in tertiary education.

When it comes to activating its skills supply, Mexico will need to tackle the challenges of:
• Removing supply and demand-side barriers to activating skills in (formal) employment.
• Boosting the skills activation of vulnerable groups.

Mexico could make more effective use of the skills it already has by: 
• Improving the use of skills at work.
• Supporting the demand for higher skills to boost innovation

Finally, Mexico could strengthen the overall governance of the skills system by: 
• Supporting collaboration across government and stakeholders to achieve better skills outcomes
• Improving public and private skills funding.

Building a shared road-map for action

As the first OECD country from Latin America to embark upon a National Skills Strategy country project, Mexico has demonstrated its commitment to leveraging international comparative data and good practice to tackle its own skills challenges. Equally, this analysis of Mexico’s skills system will be of great interest to many other countries around the world.

Throughout this initial diagnostic phase, we have witnessed first-hand a strong commitment to improving Mexico’s skills outcomes across government, employers and trade unions, as well as education and training providers.

The true test lies ahead, in designing concrete actions to tackle the skills challenges facing Mexico. Government cannot achieve better skills outcomes alone, so moving from diagnosis to action will require a whole of government and a whole of society approach.

The OECD stands ready to contribute to Mexico’s ongoing efforts to achieve its ambitious goals in designing and implementing better skills policies for better jobs and better lives.

OECD Skills Strategy 

For more on skills and skills policies around the world, visit: www.oecd.org/skills