Technical And Vocational Education And Training And The Labour Market .

Technic al and Voc ational Educ ation and Training and the Labour Marketin Development Cooperation occupation, which includes methodological and social skills alongside work-relatedexpertise. By acquiring key capabilities,individuals are empowered to shape theirown lives and work situation pro-actively. Labour market policy measures, asdescribed in this Strategy Paper, aim toimprove job-seekers‘ access to the labourmarket and facilitate the recruitment ofworkers. this ensures better matchingbetween the supply of and demand forskilled workers. at the same time, theyenhance the impact of technical and vocational education and training on productive employment.there is major potential to encourage interactionand synergies between technical and vocationaleducation and training and labour market policy:well-prepared and regularly updated labour market information and the monitoring of employmentimpacts are extremely important in promotingneeds-related technical and vocational educationand training and labour market policy measures;in some cases, the executing agencies are one andthe same. Measures in the area of core competency should not focus solely on formal productive employment but must also involve the infor mal sector – the dominant labour market sectorin many of these countries – whose progressiveintegration into formal business cycles is especially important in boosting economic activity.this Strategy Paper does not deal with issueswhich relate to: the demand side of the labour market(especially job creation in a more dynamiceconomy),targeted improvement of employmentquality (e.g. compliance with social standards), or instruments and impacts of passive labourmarket policy or social policy.these aspects are dealt with in other strategy documents on economic policy advice, private sectordevelopm ent, financial system developm ent, corelabour standards and the promotion of socialsecurity systems 2.technical and vocational education and trainingand labour market policy measures, as describedin this Strategy Paper, require intensive inter acting with other sectors of German develop ment cooperation within and outside the scopeof the “sustainable economic development” priority area. attention is drawn to the followingintersections as key examples: Strategies aimed at local economic or sectorspecific developm ent, where it is difficult tomake a clear distinction between technological and management advice and technical and vocational education and training measures, are important links betweentechnical and vocational education andtraining and private sector development.the same applies to business start-up programmes which, although relating primarily to the demand side of the labour marketand therefore to private sector development, should also be combined with initialand further training measures, advisory andemployment services in order to enhanceemployment impacts.Economic policy advice, alongside labourmarket policy measures in line with thisStrategy Paper, may also include thoselabour market policy measures which help For example, BMZ: Sectoral Policy Paper on Financial System Development, Bonn, January 2004; BMZ Special: Implementing Core LabourStandards in Developing Countries, Bonn, September 2003; BMZ Special: Promoting Social Security Systems in Developing Countries, Bonn,March 1999. Updated editions of the BMZ‘s strategy papers for thepromotion of the private sector and the provision of economic policyadvice are forthcoming.

Technic al and Voc ational Educ ation and Training and the Labour Marketin Development Cooperationto safeguard and create jobs (e.g. within theframework of structural or regional policyinitiatives). as the corollary of greater investment inbasic education, the question of what willhappen to the increasing number of schoolleavers is becoming an ever more urgentissue in technical and vocational educationand training. intensive cooperation withstakeholders working in basic education isrequired in order to provide, on the basis oflabour market analyses, adequate capacitiesin terms of both quantity and quality and tooffer career guidance across the board frombasic education to technical and vocationaleducation and training, along with trainingfor people who have broken off their basiceducation3 (school drop-outs). See also BMZ: Basic Education for All as an International DevelopmentGoal * A Key Challenge for German Development Policy; BMZ PositionPaper, Bonn, August 2004, p. 24-25. Some technical and vocational educationand training and labour market policymeasures which relate to specialised areasof expertise may also be useful in otherpriority areas of German developmentcooperation such as health, food securityand agriculture, communication andtransportation, democracy, civil societyand public administration, or waterresources and the environment. in eachcase, it is essential to consider the crosscutting them es of conflict prevention,gender and especially youth, given thehigh proportion of young people in thepopulations of developing countries andtheir specific difficulties in accessing thelabour market.4 See also BMZ: Summary of the Series Evaluation “Combating YouthPoverty” – Synthesis Report, Bonn, October 2004. The report identifiedemployment promotion and TVET as areas in which a particularly significant contribution is being made to reducing youth poverty (p. 2).

10Technic al and Voc ational Educ ation and Training and the Labour Marketin Development Cooperation2 Significance of technical and vocationaleducation and training (TVET) andthe labour market in partner countries2ing years, the number of young peoplecoming on to the job market in developing countries will be steadily increasing.By facilitating and promoting job-seekers‘access to the formal and informal labourmarket through its activities in the area oftechnical and vocational education andtraining and labour market, German development cooperation is making importantcontributions to reducing unemploymentand underemployment. As joblessnessand underemployment among large sections of the population also have the potential to fuel conflict, technical and vocational education and training and labourmarket policy measures can also contributeindirectly to conflict prevention. ILO, Global Employment Trends (2004), p. 2. Calculation based on ILO, Global Employment Trends for Youth (2004), p. 6. See ILO, Global Employment Trends for Youth (2004), p. 8, Table 4.A skilled workforce and a functioninglabour market are key location factors,influencing not only the competitiveness of businesses, economic sectors andregions within the country concerned,but also its international competitiveness.This is because competitive advantagesare increasingly based on innovation andknow-now, and on their dissemination andvalorisation in all sectors of the economyand society. Technical and vocational education and training in the broad sensedescribed above (see Section 1.2.) makeskey contributions to the dissemination ofknow-how. A functioning labour marketpromotes the valorisation of this know-howby establishing the framework for this process and providing the necessary support to

Technic al and Voc ational Educ ation and Training and the Labour Marketin Development Cooperationenable skilled workers to find suitable jobsand assisting em ployers to find skilled staff. access to productive employment for asmany people as possible is a key factor forincome distribution and participation bybroad sections of society in economicgrowth 8. economic growth can only contribute to poverty reduction and sustainabledevelopment if it results in more people,especially the poor, finding productivework which offers a decent wage. Needsbased training is often required in thiscontext. technical and vocational education and training and labour market measures are therefore key elements of development cooperation aimed at pro-poorgrowth.the relevance of technical and vocational education and training and labour market policymeasures for the achievement of the MillenniumDevelopment Goals (MDgs) is especially apparent from the following MDgs and priority areas ofaction defined in the Germ an governm ent‘s Pro gramme of Action 2015: Facilitating more people‘s access to productive employment and a decent wageplays a key role in achieving MDG 1, target 1 9.this access, especially for poor and disadvantaged demographic groups, must beim proved, firstly through technical andvocational education and training andlabour market policy measures, which aredealt with in this Strategy Paper, and secondly by creating new jobs, a topic which isbeyond the scope of this paper. The World Bank estimates that labour provides between two-thirds andthree-quarters of total income of poor households (Pro-Poor Growth inthe 1990s: Lessons and Insights from 14 Countries, Operationalizing ProPoor Growth research programme, June 2005). MDG 1: Eradicate extreme poverty and hunger; Target 1: Halve,between 1990 and 2015, the proportion of people whose income is lessthan one dollar a day. 11MDG 8, target 16 explicitly calls for thedevelopment and implementation of strategies for decent and productive work foryouth. Young people‘s access to productiveem ploym ent is particularly influenced bytechnical and vocational education andtraining and targeted labour market policyparameters and measures.In the first of its priority areas of actiondefined in the Programme of Action 2015,the german government emphasises theimportance of boosting the economy andenhancing the active participation of thepoor. as the action envisaged, the germangovernment will support technical andvocational education and training andemployment opportunities for the poor,especially for young people.MDG 3 and the Programme of action 2015,priority area 15, make it clear that technicaland vocational education and training andlabour market policy must make a contribution to women and men participating inwage employment on the basis of equality(see MDg 3, indicator 11: Share of women inwage employment in the non-agriculturalsector).Core labour standards must be upheldin all labour market policy measures (seeProgramme of action 2015, priority area ofaction 7) 10.Better employment and income are alsokey prerequisites for the sustainableachievement of MDgs 2-7, for only on this10 For information on specific measures to promote compliance withcore labour standards, see the BMZ Special mentioned in Footnote 2.

12Technic al and Voc ational Educ ation and Training and the Labour Marketin Development Cooperation building capacity for the development of humanresources13. The German government was a fervent champion of both these declarations.2.2Starting conditions in partner countriesThe dialogue on redefining the roles of thestate, the private sector and civil society, whichhas arisen as a corollary of globalisation, has inmany places proved to be a driving force forreform endeavours in the area of technical andvocational education and training and the labourmarket as well. The debate about the progressivereduction of the state‘s role to regulatory functions, the involvement of the social partners andcivil society groups in implementing technicaland vocational education and training andlabour market policy (e.g. in national technicaland vocational education and training andemployment agencies with stakeholder representation on the basis of parity) and compliance withthe principle of subsidiarity in the state‘s actionsare all gathering pace in many partner countries.The recognition that labour market policy measures are required in some scenarios in order tobridge the gap between employability andproductive employment, and that these measures should not only take account of formalemployment, is reflected in a growing demandfor integrated support in this area.In implementing these reforms, technical andvocational education and training systems andactive labour market policy face a problem: tocontribute to reducing unemployment andunderemployment, to satisfy the high socialdemand for technical and vocational educationand training, and to respond adequately to the11 BMZ Position Paper: “Anchor Countries – Partners for Global Development”, December 2004, p. 1 and 9.12 United Nations: Report of the World Summit on Sustainable Development, Johannesburg, South Africa, 26 August – 4 September 2002, p. 3.13 United Nations: Report of the International Conference on Financingfor Development, Monterrey, Mexico, 18-22 March 2002, p. 7.

Technic al and Voc ational Educ ation and Training and the Labour Marketin Development Cooperationrapidly growing demands of modern economicsectors. in many cases, these countries face struc tural challenges as well: in most partner countries of german development cooperation, a key feature of thelabour markets is segmentation betweenurban and rural, modern and traditional,and formal and informal sectors. thereis little transparency for job-seekers oremployers.or support the transition from vocationaltraining into productive employmentare – where they exist – often inefficient.Employment and advisory organisa tions often lack any service orientation orcustomer focus. there are still labour supply and demand gaps, and analysis of bothsides is poor; the result is a lack of efficiencyin the placement services. the steadily increasing number of youngpeople reaching working age, shrinkingemployment opportunities in the publicsector, intensifying competition for jobs instagnating organised labour markets and,in some cases, over-regulation in the formal sector mean that a growing numberof people are working on a self-employedor employed basis in the informal sector,and in insecure employment conditionshere and elsewhere.in some partner countries, disproportionately high growth in modern labour market segments has generated a demand forhighly skilled workers which often cannotbe satisfied. Furtherm ore, in countries withlittle or no employment growth, a substitu tion of low skilled workers by better qualified staff can be observed. Low-skilled andinformal-sector workers are more exposed tocyclical changes and often have no resourcesor access to funding for upskilling. in someasian countries in particular, labour migra tion models are increasingly being debatedat political level, the aim being to reducethe burden on the national labour marketsthrough the “export” of skilled workers.Labour market information systems andinformation about informal labour markets often do not exist or are inadequate.Structures and mechanisms which regulate13 Often, only initial vocational trainingis subsumed within the technical andvocational education and training system. in many cases, it is primarily gearedtowards achieving or cementing a socialstatus for the trainees and their familiesand towards accessing tertiary education.access to productive employment is not apriority. Rigid entry conditions and inflexible learning locations and times createbarriers to access for marginalised socialgroups. Funding for this type of traininghas become a problem in many places.Continuing professional development/upskilling is often only provided by majorcompanies for their own purposes. Veryfew countries perform any functions in thisarea which could enhance transparency (e.g.com parability of qualifications) and qualityassurance. the same applies to retraining.the importance of lifelong learning for participation in the knowledge society and forthe labour market‘s changing needs is onlygradually being recognised.the overlap of institutional competen cies14 which can sometimes be observedoffers potential for efficient linkagebetween technical and vocational educa-14 In a number of countries, the ministry of labour, which is generallyresponsible for labour market policy, is also responsible for non-formalvocational training, whereas the responsibility for formal technicaland vocational education and training often lies with the educationministry.

14Technic al and Voc ational Educ ation and Training and the Labour Marketin Development Cooperationtion and training and labour market policymeasures at various levels. in most cases,however, a lack of hum an and financialcapacities and inflexible structures preventthis potential from being tapped. the situation is exacerbated by the fact that in manypartner countries, constrained publicbudgets slow down adaptation processes,especially at times when there is great pressure to reform. This has an impact on thefunding of services whose delivery is theresponsibility of the state. At the same time,reforms geared towards the decentralisation or privatisation of services run the riskof failure as the resources required for thisprocess are not secure.3 ObjectivesThe overarching goal of German developmentcooperation is sustainable poverty reduction andthe achievement of the MDGs. The objective ofall measures undertaken in the area of techni cal and vocational education and training andthe labour market is to make a measurable contribution to safeguarding and increasing productive pro-poor employment in developing, newlyindustrialising and transition countries. To thisend, interaction and synergies between labourmarket policy and technical and vocational education and training should be utilised in a targeted way. Improving the employability andincome situation of poor social groups andimproving their access to formal business cyclesare priorities in this context.This defined objective directly reflects the important role played by productive employment andtherefore income security in successful povertyreduction, in line with the MDGs and the Programme of Action 2015 (see Section 2.1 for a moredetailed discussion). It also conforms with the criterion of strengthening employment-orientedgrowth processes by improving competitivenessin partner countries, which applies to the priorityarea of sustainable economic development as awhole.

Technic al and Voc ational Educ ation and Training and the Labour Marketin Development Cooperation154 Experiences and opportunities4.1Cooperation at multilateral and EU level 15Most donors‘ programmatic statements focuseither on technical and vocational education andtraining (often as a component of education in ageneral sense) or on labour market policy measures. By contrast, the International Labour Organization (ILO) promotes a holistic view, for itsrecommendations link support for the reform ofnational technical and vocational education andtraining systems with employment and labourmarket policy measures. The OECD Jobs Strategyadopted by the Organisation for Economic Cooperation and Development (OECD) and theEmployment Guidelines established by the European Union (EU) also emphasise the importanceof labour market and education policy measures.Technical and vocational education and trainingThere has been a shift of perspective in thedevelopment cooperation undertaken in thefield of technical and vocational education andtraining in recent dec

Technical and Vocational Education and Training: Clarification of terminology and correlations in the EU context Annex 3 36 Technical and vocational education and training provision. More detailed explanation of Section 5.2.2 of the Strategy Paper Annex 4 37 Multilateral and European cooperation in the technical and vocational education