STRENGTHENING SKILL USE AND SCHOOL-TO- WORK TRANSITIONS OECD Economic Survey of the Czech Republic 2014

Key messages  Moving up the value added chain requires new set of skills  Growth depends on an education system that adjusts to changes in labour market needs  There are unemployed skills that could be put to effective use 2

PART 1 Education

Education / school-to-work transition challenges:  Learning outcomes are declining: o Performance in PISA has deteriorated o The share of low achievers has increased  Students with VET are faced with: o Little demand for their skills o Or with skills that are not suitable  Quality concerns in fast expanding tertiary education: o Higher intake in the public system o The emergence of private institutions 4

Student performance is strongly influenced by socio-economic status 5 Source: OECD PISA 2012 Database.

Declining Educational Performance  Related to strong selectivity in the education system o Streaming o Early tracking o Low transferability between tracks  Selectivity reinforces students’ socio-economic background o Leaving many students behind o Without raising average performance  Selectivity has negative effects on: o Labour market prospects o Human capital accumulation 6

Policies: Provide a solid skill foundation by avoiding selectivity in education  Expand early childhood education  Eliminate early tracking  Avoid streaming into special needs schools  Increase transfer possibilities between tracks  Improve teaching quality  Use standardised national tests to introduce school benchmarking 7

Poor match between fields of study and work branches in VET 8 Source: National Institute for Education.

Challenges in the VET System:  Unlinked from the labour market  Limited use of workplace training  Fragmented involvement of social partners  Concerns about quality of general education, particularly in apprenticeships 9

Policies: Improve the match between VET and the labour market needs  Increase participation of private employers  Introduce a contract between apprentices and their employers  Stimulate workplace training for difficult-to-place students via subsidies to firms  Link school financing to labour market developments  Improve the quality of general education to reduce drop-out rates in apprenticeships 10

Tertiary Education: Challenges  To reach the OECD average, current high intake needs to be sustained  Increase in student intake rose faster than financial resources  Concerns regarding diverging quality standards in private and public HE institutions  Weak connections with the private sector 11

High returns on tertiary education 12 Source: OECD Education at a Glance and National Accounts Databases.

Policy: Secure quality in tertiary education  Introduce output based accreditation criteria (focus also on the quality of universities’ output)  Strengthen the links with the private sector and foreign research networks  Increase resources: student fees with grants and income-contingent repayment loans  Support student choices with labour market outcome information 13

PART 2 Labour Market Issues

Challenge: Make more effective use of existing resources and skills  Youth and low-skilled unemployment o Much higher than the national average  Low Female labour market participation o Gender employment and wage differentials are large o Strong work disincentives for mothers with small children 15

Policy: Promote youth and activate low-skilled employment  Secure training for unskilled youngsters via subsidies or a youth minimum wage linked to training  Provide sufficiently long work place training to secure strong skills acquisition  Focus ALMP resources on clearly identified target groups and establish performance targets  Improve monitoring of active labour market programmes 16

Female Labour Market Participation 17 Impact of motherhood on employment Source: Eurostat.

Policy: Support family and working life choices  Provide an adequate supply of affordable and high quality early childcare facilities  Reduce maximum duration of parental leave  Turn part of the parental allowance into vouchers  Condition allowances on fathers’ participation  Increase opening hours of early child care facilities 18

Thank you! Děkuji! 19

Occupation and education are changing 20