1. findings from forthcoming regional flagship report Skills, not just diplomas Presentation of findings from forthcoming regional flagship report Mamta Murthi May 12, 2010

2. Future growth requires skills  Why skills? Recent growth masked many shortcomings of regional economies – postponed reforms Future growth will rely much more on improving competitiveness Improving labor productivity requires skills 2

3. Messages and structure of presentation  What skills are we talking about? Broad set of skills: cognitive, social and life skills  How well are education and training systems doing? Expanding access Providing skills for all  What can countries do to improve? Provide better information on quality of education Relying more on incentives to steer sector 3

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5. Complex skills are needed and all workers need them 5 Source: European Survey of Working Conditions 2005

6. There is broad agreement on the skills needed to succeed in work and life 6 Source: OECD (2005): Definition and Selection of Competencies (DeSeCo) Project

7. Good news: more diplomas are being issued 7 Source: World Bank Edstat

8. But quality of lower secondary in ECA countries falls short 8 Source: OECD PISA 2006 1 year behind 2-3 years behind 3-4 years behind Science MathReading OECD avg

9. Too many students do not have the ability to “read to learn” 9 Source: OECD PISA 2006

10. Higher education does not provide students with the right skills 10

11. Fraud, corruption and unethical behavior – quality of diplomas? (*) Data for Kyrgyz Republic is a based on a slightly different question: students were asked if they had “personal experiences with corruption and bribery in their university”. 11 Source: Heyneman, Stephen P. Kathryn H. Anderson, and Nazym Nuraliyeva (2007)

12. Employers found “skills” to be a major constraint before the crisis 12 Workers' skills had become a constraint on firm expansion by 2008. (percent of firms considering factor a 'major' or 'very severe' constraint) Source: Turmoil at Twenty, World Bank, 2009

13. Quality assurance mechanisms are in their infancy

14. Regulators find many degrees do not meet quality standards 14

15. Let’s face it: very little is known about the good versus the less good  Unhealthy tendency to focus on excellence at the top rather than the quality achieved by all  What do we really know about the quality of tertiary education when it comes to creating skills? Bologna is far away! Which institutions are truly great at imparting skills to their students?  What happens to students after they graduate? 15

16. In the dark… …all individuals, institutions and systems look the same… But with a little light….

17. But with a little light…. …important differences become apparent…. In the dark… …all individuals, institutions and systems look the same…

18. Example of important unknown  There are around 35 HE institutions teaching economics in Kiev: 20 private and 15 public Student’s perspective: which institution does a better job at teaching me the skills I need to succeed? (selectivity ≠ high quality teaching) Employer’s perspective: which students outside of the prestigious institutions have skills? Policy maker’s perspective: which institution is performing well? Which institution need sanctions/rewards/support? 18

19. The distribution matters! Academic growth of students Limited academic gains Solid academic gains Significant academic gains 19 Dramatic academic gains & impact

20. What can policy makers do better?  Turn the lights on! Measure, analyze, disseminate and use results for policy making  Different role for central policy makers: less micro-management and more focus on steering 20

21. Turning the lights on! Collecting data Analyzing and disseminating Using results for decision making 21 Tracer studies Quality of tertiary Quality of vocational education Quality of training Performance- informed budgeting Linking incentives to results

22. Use information on results to steer  More autonomy in exchange for results  Use financing as an instrument: tie resources to results  Increasing accountability for results 22 Accountabi lity Financing Autonomy

23. Steering involves a balancing act among three instruments Innovation Compliance AccountabilityFinancingAutonomy 23

24. Don’t rely on only one way to strengthen accountability  Accountability through accreditation and quality assurance… but this takes time!  Accountability through information and transparency: rankings, performance tables (e.g. CHE), tracer studies (e.g. the US and LAC)  Accountability through partnerships with civil society and students (e.g. Romania) 24

25. Better use of sector’s resources is needed to pay for better quality 25

26. The right policies can have a big impact 26 Reform years

27. How can the World Bank help creating skills for competitiveness?  For more information on report: contact Lars Sondergaard, Mamta Murthi or Andrei Markov lsondergaard@worldbank.org or mmurthi@worldbank.org lsondergaard@worldbank.org mmurthi@worldbank.org  For technical support and/or fee based services to strengthen skills creation: contact Isak Froumin ifroumin@worldbank.org 27