Returning Irish needed to fill workforce's big skills gap
For a second time in a quarter century returning skilled Irish emigrants are seen as essential to fill a skills gaps in the workforce — again it's easier than addressing the enduring skills gap at home.
The outgoing government has forecast that about 70,000 Irish nationals, or almost half of net Irish emigration in the period 2009-2015, will return to jobs at home by 2020.
Earlier investment in education was seen in the early 1990s as a key factor in the surge of American foreign direct investment (FDI). However, in 2013 Ruairi Quinn, then education minister, threw cold water on the myth that Ireland had a world-class education system.
Quinn, in a rare case of a minster making a statement without any resort to spin, said the assertion that Ireland had one of the best education systems in the world “was frequently trotted out in the past, but blatantly wasn’t true. ”It was nothing other than:
a feel good factor that was communicated to us at home by the greater Irish Diaspora who felt, for whatever reason, that it was better than what their children were experiencing in other parts of the world.
Last month The Irish Times reported that University College Dublin was offering "literacy clinics" for struggling students.
Prof Mary Gallagher, who lecturers in French at UCD, told the newspaper that she is increasingly alarmed about the rising minority of students are not sufficiently literate or numerate.
We need to stop pretending that 85 per cent of Ireland’s youth are academically inclined, because this is a damaging lie. Germany, for example, avoids this damage: that’s why apprenticeships rather than degrees are so highly valued there and why they attract such able people. Either Irish school-leavers are up to 50 per cent more academically inclined and talented than their European peers or else they are being misdirected into further academic endeavour when they would be better suited to following a more authentic, less pseudo-academic training.
At the end of January 2016, the OECD published a report showing that England has more university students with weak literacy and numeracy skills than most countries. Ireland is among the countries with the worst rankings in the developed world as per the chart below.
The OECD authors shows that in 2012 about one in five Irish university graduates could manage basic literacy and numeracy tasks — including a task such as following the instructions on a bottle of aspirin — they but had problems with more complex tasks.
The report also shows that many Irish teenagers had problems with a basic grasp of language and maths. Among 16-19 year-olds, Ireland ranked 18th of 23 countries in literacy, and 21st out of 23 in numeracy.
England and Ireland have about three times as many low-skilled young people as the best-performing countries such as Finland, Japan, Korea and the Netherlands.
One in six students at Irish third level fails to get beyond the first year.
IDA Ireland's iconic advertisement of the 1980s promoting Ireland as a location of skilled and educated workers>>>>>
The Organisation of Economic Cooperation and Development’s Survey of Adult Skills, also known as the Programme for the International Assessment of Adult Competencies (PIAAC) in 2012 carried out a survey of adult skills in 24 countries. 5,000 to 7,000 participated in each country survey. Ireland had the third highest response rate of participating countries at 72%, with almost 6,000 adults between the ages of 16 and 65 responding to the survey.
Australia, Austria, Belgium (Flanders), Canada, Czech Republic, Denmark, Estonia, Finland, France, Germany, Ireland, Italy, Japan, Korea, Netherlands, Norway, Poland, Russian Federation (non-OECD member), Slovak Republic, Spain, Sweden, United Kingdom (England and Northern Ireland), United States were the participants.
Adults in Ireland had an average (mean) score on the literacy scale of 266 compared to the study average of 270. This adjusted mean score placed Ireland 17th out of 24 participating countries, and in a group with Germany (267), Poland (267), Austria (266), Flanders (Belgium) (266) and Northern Ireland (265), whose literacy mean scores were not statistically different from that of Ireland. Japan (294) and Finland (288) had the highest literacy mean scores (adjusted).
The mean score for the 16-24 age group was 280 score points, 7 points higher than that for all adults (273 score points). The difference in scores between the countries with the highest and lowest scores was 38 score points for the 16-24 year-olds as opposed to 46 score points for the 16-65 year-olds. The 16-24 population in Japan (299 points), Finland (297 points), the Netherlands (295 points) and Korea (293 points) had the highest mean scores, while those in Ireland (271 points), Italy (261 points), Spain (264 points) and England/ Northern Ireland (UK) (266 points) had the lowest mean scores.
Adults in Ireland aged 16–65 had a mean score of 255 on the numeracy scale, significantly below the PIAAC average score of 266. This adjusted mean score placed Ireland 19th out of 24 participating countries and in a group with Northern Ireland (255) and France (253). Japan and Finland scored the highest on numeracy with adjusted mean scores of 286 and 282 respectively.
The problem solving in technology-rich environments domain assessed the respondent’s ability on laptop computer to use a number of common computer applications (e.g. email, spreadsheets, word processing, internet browser) to complete various tasks. The tasks ranged in complexity from answering emails to buying tickets using an online booking system given certain criteria and restrictions.
In Ireland about 17% of the sample opted to take a paper rather than a computer-based assessment even though they had indicated some prior computer experience, compared to about 9% internationally. This means that no problem solving data exists for this group.
In Ireland more than two-fifths (42%) of adults scored at or below Level 1 (29.5% at Level 1, 12.6% below Level 1) on the problem solving scale the same as the study average (41.7%).
Last November the Economic and Social Research Institute (ESRI) reported that the Back to Education Allowance (BETA) courses for an average 25,000 unemployed annually in recent years are generally useless. The institute said in respect of the activation scheme that it:
found no evidence that people who commenced an education programme in 2008 under the BTEA scheme benefitted from improved employment outcomes in the period up to 2014. In fact, compared to similarly unemployed individuals, jobseekers who commenced an education course supported by the BTEA programme in September/October 2008 were between 23 and 38 percentage points less likely to have exited unemployment to a job by June 2012, and between 14 and 29 percentage points less likely at the same time in 2014.
The OECD in its Economic Survey of Ireland 2015 noted:
A high share of the workforce with tertiary education earn more than twice the median income. A possible contributor to this high earnings premium for tertiary education is the strong presence of multinationals, which offer highly-paid jobs to those with high skills. By contrast, those with below upper secondary education are concentrated at the bottom of the income distribution. [ ] Ireland faces the challenge of having a very high share of its population being unemployed or inactive, and thus receiving no labour earnings. The unemployment rate among the poorly educated is significantly higher than the rate for those with tertiary education. This situation prevailed before the crisis, suggesting that it is a long-standing structural problem.
Despite the general improvement in the Irish economy and its labour market, the outflow of university graduates exceeds the inflow. Productivity prospects of domestic companies, whose ability to hire workers abroad is limited, are more likely to be affected by this net outflow of qualified workers than multinationals, which are more successful in international recruitment. This risks that the already large productivity gap between domestic firms and multinationals will widen further; it also highlights the need for Ireland to optimise policies to retain and attract qualified workers, and to facilitate that all companies can take full advantage of these policies.
The activity rates of the low-skilled are particularly low in Ireland. Only 50% of the individuals in the 20-30 age group are employed or are seeking work, 20 percentage points lower than in other advanced economies in the European Union. Ireland has a markedly higher percentage of younger cohorts (25-34 years old) with tertiary qualifications than both OECD and EU averages. However, there remains a large cohort of unemployed with insufficient skills. Raising skill levels is especially important for reducing inequality at market incomes given the mentioned evidence that the reward for education and the penalty for a lack of skills are very high. These high skill premiums and penalties result from the wide gap between the skills of the workforce and the needs of employers: employers are willing to pay a premium for hard-to-find talents, but are unwilling to do so for the many with low skills.
In 2010 the OECD noted in respect to vocational and education training that data on labour market outcomes were fragmented and research on VET was scarce. "The wide range of VET programmes has not been systematically evaluated. Career guidance services are fragmented and weakly underpinned by information on labour market opportunities."
Ireland's apprenticeship system until the bust was mainly related to construction and had almost 30,000 participants and in recent times the number has fallen to about 7,000. See table here for the leading apprenticeship countries.
There were 86,000 registrations between 1993-2011 and 52,000 received certificates.
Unlike countries in Europe such as Germany, the system in Ireland has only covered male-dominated crafts while there is no tradition of dual work and education.
Both Fine Gael and Labour have proposed adding 50,000 apprenticeships but there is no detail on how business sectors will be forced or induced to take on so many trainees.
Based on 2008 and 2011 costs to the State for education and allowances of €12,000 per apprentice annually (see here Page 22), there is no information on how much of the €600m bill would come from employers — maybe the politicians own interest is to magic up job creation figures.
Finfacts 2014: Computer coding is a trade that doesn't need college degree
Public training on respirator
Training is a big business sector contracting for public agencies but as in the ESRI report cited above, the extent of public monies wasted is unknown. During the recession, unemployed people in Cork had to attend a course that included Toyota's just-in-time manufacturing system!
Cedefop, the European Centre for the Development of Vocational Training, says in a publication that the preferred option for upper secondary Irish high school graduates is to proceed to tertiary education: in 2010, approximately 50% entered tertiary education, while 22% entered FET [Further education training; PLC (post leaving certificate) courses, 20%; FÁS/SOLAS courses (including apprenticeship), 1%]. To address this issue, part of the remit of the newly-established Further Education and Training Authority (SOLAS) is to improve the attractiveness of FET/VET programmes in society.
The chart below from the Cedefop report shows recent training metrics:
Pic on top: Ministers Damien English, Joan Burton, Charlie Flanagan & Paudie Coffey welcome the announcement by ESB Networks of 30 apprenticeships, 23 Feb 2015 — ministerial productivity!
In past times the vocational sector was the poor relation of secondary school education that would lead to university, which widended access in particular after the introduction of a grants system in the late 1960s.
Only 3% of Irish SMEs (small and medium size firms with up to 249 employees) are active in manufacturing, whereas the equivalent figure for the EU is 10% according to the European Commission. Ireland and Luxembourg have the lowest number of manufacturing firms in the EU28.
The Irish middle class has traditionally aspired to have their children become doctors or lawyers — and many of those who choose medicine move overseas. Meanwhile, about a third of the doctors working in Ireland are from overseas. In Finland, teachers who have to have a master's degree are paid as much as lawyers and doctors but still lower than Irish counterparts.
For lower middle class and small farmers a job in the civil service was regarded as a coup. Joseph Brennan (1887–1976), Ireland's leading civil servant in the early years of the State was educated in Cambridge and his family was the wealthiest Catholic business family in Bandon.
There wasn't a big interest in what is called metal-bashing and in recent times, many of the services jobs in foreign companies are glorified call centre positions.
A Central Bank economics paper noted in 2012 that "despite Ireland’s reputation as one of the world’s most globalised economies, fully 64% of private sector workers are employed by indigenous non-exporting firms, with 56% working for indigenous, non-exporting SMEs."
The economists added: "These statistics highlight the importance of domestic demand for employment generation, and suggest that an export-led recovery may not be a panacea for the Irish unemployment crisis."