1. Why does ETF address ‘matching of supply and demand of skills for the labour market’? Matching is about reducing the gap between supply and demand in the labour market, increasing the employability of the workforce and reducing skills shortages. The focus of the ETF project lies on education and training in a lifelong learning perspective, monitoring, anticipating and forecasting approaches, for both the demand and the supply side, and effective labour market management. - Skills mismatch, a challenge in most ETF partner countries, leads to adverse impacts on individuals and whole economies, resulting in high youth unemployment and low competitiveness of enterprises. - There is a need for effective approaches for better monitoring and forecasting of skills supplies and skills demands which also work under the framework conditions of ETF partner countries. Global competition, technology- dependency and industrial restructuring cause rapidly changing skills demands in transition and developing countries. The supply side of skills is shaped by demographic changes (migration, birth rates, ageing society) and reforms of their E&T systems. - Improved matching systems are needed for better labour market outcomes. Monitoring and forecasting is not an end in itself but an input to evidence-based policy making. The ETF matching project will therefore explore the question ‘who needs what?’ There is a need to better inform decision makers and practitioners in the E&T and the labour market management systems.
The overall project objective is to support ETF partner countries to improve their systems for a better matching between the supply and demand for skills in the short and medium term, thus enhancing the employability of youth and adults and improving economic competitiveness.
The specific objectives are i) to provide methodological instruments for measuring mismatch, ii) to develop methodological approaches and instruments for monitoring and anticipating skills requirements which are relevant to the specific conditions in developing and transition economies, iii) to elaborate policy briefs with recommendations for better matching approaches, and iv) to generate and share knowledge among ETF departments and country teams.
The results will be disseminated and debated with policy makers and expert practitioners of the E&T systems, public employment services, social partners and researchers in ETF partner countries. Project implementation will take full account of good practices, build on the rich experience of monitoring, anticipation and matching in EU countries and assess the transferability of good practices that work under the specific framework conditions of ETF partner countries.
2. To make better use of the skills of high educated young people and contribute to enhanced productivity and competitiveness are top priorities A mismatch between skills demand and supply leads to high numbers of unemployed people – among them many well educated young – on one side, and on the other side to skills requirements from employers which cannot be met. Large sectors of informal employment constitute a specific “in” and “out” for labour market participants, and in some cases a dual economy with modern enterprises at one side, and a traditional sector with low productivity at the other. The problem of skills mismatch has gained additional momentum with the impact of the global economic crisis on the labour markets in ETF partner countries; some have proved more, and others less shock resistant. Mismatch in the form of overeducated young people is triggering migration and means a waste of human resources.
Modernisation of vocational education and training (VET) systems is an ongoing process in most countries, but needs to be embedded in strategic visions and concepts. Continuous vocational training is often underdeveloped. ETF has been supporting the improvement of the effectiveness and external efficiency of the VET systems. This has to be closely linked with the present and future demand for skills. To help improving matching between skills developed through VET and skills demanded by the labour market is at the heart of ETF’s work.
3. How is ETF addressing these challenges and contributing to improved matching of supply and demand in the partner countries? Project implementation started with strategic and conceptual clarifications of core key issues relevant for ETF partner countries such as how “mismatch” can be defined and measured under the condition of large informal economies, of low capacities of employment services, or scarce statistical data available. A stocktaking of a number of partner countries has taken place with a view to analyzing current anticipation and matching practices and capacities to work in this field. During the first year of the project implementation the ETF made an attempt to test different methodologies to calculate mismatch based on the national quantitative data available. The ETF has brought together renowned experts from various partner countries with high level experts from EU member states and agencies to create a discussion platform and to explore and clarify the concepts. These experts will be used as an external reference group in the course of the project implementation whenever relevant. In 2012 and 2013 the ETF will work on developing a set of methodological guides for both ETF country managers and partner country experts to help analyse the problems and create evidence which could be used to improve anticipation and matching of skills in the partner countries. The methodological guides which will take into account both quantitative and qualitative aspects of the labour market analysis and policy briefs will be disseminated to policy makers, social partners, experts and practitioners.
4. Synergy and sustainable results. A high awareness of the importance to improve matching systems can be observed. This is confirmed by findings from recently finalised studies such as the Torino Process, labour market reviews, entrepreneurial learning and HRD reviews. The project is a response to demands expressed by ETF partner countries. Specific country activities are already being implemented to assess sector specific skills demands in emerging industries or industries undergoing restructuring and modernisation; other activities support capacity development of national policy makers. The results of the project are i) methodologies to measure mismatch, ii) a compendium of methodological guides for monitoring and anticipating skills demands, iii) to strengthen ETF expertise in matching skills supply and demand, and iv) to provide tools for ETF interventions at country level.