Special Lecture in
Development Management
Knowledge Economy
Policy for human capital development in East
Asia and Pacific… and the rest of the world

Hiroshima, May 29, 20131

Importance of Human Capital Policy Focus• Traditional emphasis on school attainment• Development of access programs
– MDG
– EFA

• Some success but still challenges• …….. QUALITY as a key element2

Importance of Quality•Cognitive and non‐cognitive skills•Individual learning•Economic growth•Distributional outcomes•Policy actions and reform•Resources policies•Supply and demand side incentives•Importance of information…. To define
policies and talking about information…
3

Although this may be different inJapan, do you know that ….
1• The Department of Labor estimates that in the
USA today’s learner will have between 10 and
12 jobs…..

4

Although this may be different inJapan, do you know that ….
1• The Department of Labor estimates that in the
USA today’s learner will have between 10 and
12 jobs…..
• By age 40!

5Although this may be different inJapan, do you know that ….
2• According to the Department of Labor 1 of 4
workers in the USA today is working for acompany where they have been working lessthan 1 year
• And more than 1 out of 2 are working for acompany for whom they have been working
for less than 5 years

6

Do you know that ….
• The top 10 jobs that were in demand last year
(2012) did not exist in 2006

7

Do you know that
• We are currently preparing students for jobs
that do not yet exist?

8

Do you know that
• We are currently preparing students for jobs
that do not yet exist?
• Using technologies that have not yet been
invented?

9

Do you know that
• We are currently preparing students for jobs
that do not yet exist?
• Using technologies that have not yet been
invented?
• In order to solve problems we do not evenknow are problems yet?

10

Do you know that
• Nintendo invested $140 M in research anddevelopment in 2002 alone?

11

Do you know that
• Nintendo invested $140 M in research anddevelopment in 2002 alone?
• And that this is less of what the Federal
Government invested in research andinnovation in education in 2010!!!

12

By the way, do you know that
• 3 of every 10 couples that married this year in
the USA met online?

• We are living in exponential times!!!
13

In fact• The number of text messages sent everyday
exceeds the number of the total world
population.

14

And do you know
• The number of questions people ask Google
everyday?

15

And do you know
• The number of questions people ask Google
everyday?
• Four years ago it was 2.5 billions a month.
Now I think is 2.5 billion a week16

And do you know
• The number of questions people ask Google
everyday?
• Four years ago it was 2.5 billions a month.
Now I think is 2.5 billion a week
• And the questions are asked in more than 150
different languages!!!!

17

By the way• To whom were these questions addressed
B.G.?

18

Do you know that
• There are about 540,000 words in the English
language?

19

Do you know that
• There are about 540,000 words in the English
language?
• About 5 times as many as during
Shakespeare’s time.

20And do you know that
• More that 3,000 new books are published …

21

And do you know that
• More that 3,000 new books are publisheddaily!!!

22

Do you know that
• The amount of new technical information isdoubling every 2 years?

23

Do you know that
• The amount of new technical information isdoubling every 2 years?
• And that for students that are starting atechnical or college degree this means that
half of what they learn the first year will be
outdated by their third year of study??????

24

• It is estimated that 1.5 exabytes (1.5 X 10 to
the 18) of unique new information was
generated in the world in 2010.

25

• And that was more than in the previous 5,000
years!!!
• By now this amount of information double
every 5 days!!!

26

Do you know that Facebook• Was the first Web‐site to receive 1 trillion
page views in one Month?
• And 3 billion ‘likes’ in one day?
• ……You may not be surprised but

27• What does it all means?

28• What does it all means?
• Shift happens

29

• Now you know

30

……...that things are changing…….
….
And, what are we doing to takeadvantage of it?
How are we using, accessing
information/knowledge? How are weapplying it?
31

Let’s remember that the personal computer isenabling millions of individuals to become
authors of their own content in digital form.
The spread of the Internet and the emergence ofthe World Wide Web is enabling more people
than ever to be connected and to share theirknowledge.
The emergence of software standards means thatpeople are able to seamlessly work together andupload and globalize content.

32

Knowledge, Innovation and Competitiveness
Understanding the Knowledge Economy: Major Trends
The ability to create, access and apply knowledge is becoming afundamental determinant of global competitivenessInnovation policies are critical to the ability of countries to compete
and grow in a globalized environment
New models of knowledge production, access and distribution are
emerging (e.g., open source, knowledge communities…) and we all
can use them. MOOCs (Massive open online courses like Coursera,
Udacity, register 160,000 students for a class and free!!!; even Khan
Academy has delivered more than 200 million lessons)Shift to knowledge‐intensive industries highlight the importance ofwell trained talents
Technological Connectivity is transforming the way government,
33
business, and citizens interact

Knowledge, Innovation and Competitiveness
Adjusting Education and Learning Systems for the Knowledge
Economy‐Addressing first generation challenges: access, equity, andquality (ECD, basic education, minimum institutionalsetting)‐Addressing second and third generation challenges:(i) adjusting teaching and learning environments to respondto new competency requirements(ii) expanding opportunities and building competencies insecondary education(iii) expanding relevant and high quality tertiary education(iv) strengthening vocational and firm‐based education andtraining in a cost‐effective way(v) adopting comprehensive lifelong learning policies
34

Knowledge, Innovation and Competitiveness
Expanding opportunities and building competencies in secondary
education‐Improve access with quality‐Develop curriculum that is more flexible, relevant, andresponsive to both local needs and the global environment‐Foster better linkages between schools and labor market
institutions (school to work transition)‐Reform assessment and examination systems to provide a
direct measure of achievement on a global level‐Increase funding for secondary education through public,
private, or community sources, while and at the same time,
maximizing efficiency and effectiveness in resource
allocation and utilization35

Knowledge, Innovation and Competitiveness
Expanding relevant and high quality tertiary education‐Expand Access‐Improve the quality and relevance of tertiary education(linkages to market needs)‐Increase institutional diversification‐Strengthen science and technology research anddevelopment capacity‐Promote greater equity mechanisms to assist
disadvantaged students‐Establish sustainable financing systems to encourage
responsiveness and flexibility‐Strengthen management capacities‐Enhance and expand ICT capacity to reduce the digital
divide36Knowledge, Innovation and Competitiveness
Adopting comprehensive lifelong learning policies‐Focus on the needs of young people and adults that are
not part of the formal education system and on the job
training (SCE programs, LLL per se)‐Create multiple education and training pathways to acquire
qualifications within a national qualification’s framework‐Provide incentives for the development of education andtraining providers‐Create certification and accreditation systems‐Develop appropriate funding mechanisms for firms andindividuals‐Leverage technology: radio, TV, internet based, interactive
video …
37

Fundamental Changes•••

Globalization– Communication and transport costs are falling– Global information– Regional integration– Free trade and competition increases– Aggregated value of MICs was 27% of Global GDP in 2012
Digital revolution
Knowledge Economy (KE)– Knowledge Revolution and its implications for education andtraining– Lifelong learning (LLL)– Key competencies for the KE

38

Knowledge Revolution• The Knowledge Revolution in the world ischaracterized by: more knowledge and more easily
accessed technologies, accelerated innovation,shorter life cycle of many products, superior
productivity and abilities of the labor force, and astrong globalization and more competition.
• The labor force is demanding more average
education and new jobs.
• Because of this, the capacity to produce, access anduse knowledge is becoming a determinant factor of
global competitiveness.

39

Changes are happening• Manufacturing is more digitalized:– More smart software– New materials (less heavy but stronger and durable)– New processes (in particular 3d printing. 3D printing?
Anybody knows what 4D printing is?)– The geography of supply chains is changing– Nonatechnology (self‐cleaning glass, ‘bandaids’ formetals)– Ford needed a lot of capital (and space) to do thesecond industrial revolution (assembly line), today you
just need a laptop and creativity. 3D and 4D.

40

This (revolution) will cause changes• From the factory to the office (the line between
manufacturing and services will be attenuated;
Rolls‐Royce does not sell jet motors, now they sell
hours of use....)• Where and how products are made• New occupations (see earlier slide)• Labor cost will decline• Consumers adapt, but Government not much so(their instinct has been to protect existentindustries). Governments should focus on
improving labor force quality.
41

It really has caused changes. See fourkind of workplace tasks
Routine Cognitive (filing, bookkeeping)Routine Manual (assembly line work or like beinga manager at the World Bank)
Expert Thinking or non‐routine analytic(identifying and solving new problems)Complex Communication or non‐routineinteractive (eliciting critical information andconveying a convincing interpretation of it toothers)42

How the demand for skills has changed
Economy-wide measures of routing and non-routine task input: 1969-1998 (1969=0)

14Complex Communication

Percentile Change in 1969 Distribution

12
10
Expert Thinking

8
6
4
2
0
-2

1969

1980

1990

1998
Routine Manual

-4
-6
-8

Routine Cognitive-10
43

The skills agenda in EAP in thiscontext
This demand for new skills present a dilemma for the education sector because
the skills that are easiest to teach are the ones that are easiest to digitize,
automate, and outsource.
So to adapt to this global environment we face a formidable list of priorities!
‐Preparing the workforce of the future (with social inclusion)‐Workforce development‐Employer engagement‐Increasing demand for learning‐Planning for skills development…
‐Role of government and governance‐Life‐long learning in the Knowledge Economy‐Paradigm shifts

44Preparing the workforce of the future
Increasing 16+ participation and achievement
Employability through general and vocational
learning (new qualifications and curriculum
delivery), after ECD for all and basic education for all
Capacity building to deliver more cost‐effective TVET
in schools
Developing understanding of enterprise, business,and the economy (Young Enterprise, citizenship, key
skills)Financial support for learners (alternative financing)45

Workforce development‐Low levels of skills in the current workforce
limits competitiveness and productivity‐Poor basic skills – Skills for life
‐Also a minimum level of vocational skills as
the baseline for employability‐Free tuition and replacement costs‐BUT higher level skills is needed in some
sectors (varies from country to country but
all countries experience this in different
degree...)46

Employer engagement
Employers influence in the design, delivery andquality assurance of general and vocational
learning is vital to secure skills for productivity
Requiring or encouraging higher skills for
employees
Recognizing and rewarding successful learning
Enabling employees to deploy new skills andknowledge
Reviewing workplace roles to deploy new skills
and knowledge
Larger and small firms

47

A framework for employer engagement 1
Employer as stakeholder:•Provides leadership through involvement in
the design, development, management,delivery and assessment of learning
Acts as visiting speakerProvides work experience places Advising on curriculum and its assessment
Participates in collegiate governance48

A framework for employer engagement 2
Employer as consumer:•Purchases diagnostic services and skills
development from providers
Uses customised day release or regularprovision as part of company training
Uses national qualifications to select new
staff and upgrade skills of current staff

49

A framework for employer engagement 3
Employer as strategic partner:•Sustained interaction between employer and theplanners and providers of learning
Uses the LSC sector providers as sources of
support for business development
 Collaborates with planners in developing newprovision for the benefit of own company andwider sector
 Contributes in cash and kind to new or updated
resources for learning – joint ventures and sharing
training facilities
 Shares or subsidises specialist staff
50

Developing the infrastructure
Look at the general and the vocational
curricula
Reforming qualifications ( EstablishingStandards, Accreditation frameworks)
Planning for skills development (Sector Skills
Councils, Learning and Skills Councils)
Focussed provider missions (Centres of
Excellence)In the case of TVET shifting reliance onfunding from the state to employers andindividuals
51Increasing Demand for Learning(changes in the labor market)
In MIC recent findings show that:‐The 12 – 16 years of formal education is no longer
sufficient to support a lifelong work life
‐Companies increasingly tend to ‘buy’ the necessary
human resources from outside labor markets rather
than ‘make’ them internally as the changes inexternal environment accelerate‐The increasing flexibility of the labor market isdemanding higher level of employability of workers‐A knowledge gap can be an important cause ofunemployment and poverty
52

Challenges in Policy Making
Also in MICs recently the policy is supporting the following:
•
•
•
•
•
•

Encouraging Corporate Learning
Encouraging Self‐directed Learning
Improving Job Training Equity
Reforming the Vocational Qualification System –demand driven
Establishing the Labor‐Management Participatory
Training System – demand driven
Enhancing the Efficiency of the Delivery System for
Job Training

I think we need to help LICs and Fragile ones do the same53

Employment by Industry(1970~2003)
80
70
60
Agriculture, Forestry & Fishing

50

Mining & Manufacturing% 40

Service and Others

30
20
10
0
1970

1980

1990

1995

1998

2000

2003

year
54

Greece

Australia

Netherlands

Ireland

Belgium

France2

Hungary

New ZealandAustria

Germany

Denmark

United States

Switzerland

MexicoTurkeyPortugal

Poland

Spain

Italy

Luxembourg

IcelandUnited Kingdom2

Percentage, by age group,
aged 25‐34,
aged 45‐54
Source: OECD
Finland

CanadaSwedenSlovak RepublicCzech RepublicJapan

NorwayKorea

Educational Attainments

Population that has attained at least upper secondary education1 (2002)
100

90

80

70

60

50

40

30

20

10

0

55

Educational Attainments
years of schooling

14.00
12.00
10.00
8.00
6.00

Korea
Mexico
Japan
U.S.

4.00
2.00
0.00
1960

1970

1980

1990

2002

year

Note : Average years of schooling for aged 25~64
source : OECD development centre(2002)
56

Enrollment at H.S. and Colleges
Enrollme nts

G eneral High School

2,000,000

Vocational High School

1,800,000

University

1,600,000

Junior College

1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
1970

1980

1990

2000

2001

source : Statistical Yearbook of Education(2004)

57

2002

2003

2004 ye arReform of VT Legal Framework ‐Korea
Before(1977~1998)

Now (since 1999)

 The Basic VT Act

 The Worker VT PromotionAct Supply-oriented System
 Training Levy System
 Compulsory Training Vocational Training Promotion
Fund Closed Training Market

 Demand-driven system
 Vocational Competency
Development Program Incentive System
 Employment Insurance Fund
(1995~)
 Open Training Market

58Increasing Demand for Learning (Demandfor Educated Workforce)
New jobs require more educated workforce-Basic skills: reading, writing, computation-Core skills: analytical, problem-solving skills,
creative thinking, self-management-Technical skills: computer skills
Education and training is part of a positive cycle ofbenefits for both employers and workers
Consequently increasing their productivity

59

Reforming Educational System
Change current subject‐centered curriculum to competence‐based
curriculum‐Develop the Basic Competency skills for All
Enhance and evaluate teacher’s ability/quality‐Promote autonomy and accountability in the school system
Strengthen the support system to promote LLL‐Set up ubiquitous learning systems (e‐Learning)‐Support LLL by financial aids (Loans, Tax Credits, etc)
Enhance quality of higher education up to global level‐Innovative role and function of universities as new engine forsustainable economic growth‐Expand cooperative system among industries, universities andresearch institutes
60

Revamp the Role of Government
Deregulation
From input control to performance control
Decentralization
From Government driven to school‐based
management
Dissemination
From no choice to choice with information
Quality Assurance
From nada to set up quality assurance system withschool improvement plans and performance
evaluation
61

A Framework for Knowledge Economy• Economic incentive and institutional regime thatprovides incentives for the efficient use of existingand new knowledge and the flourishing ofentrepreneurship• Educated, creative and skilled people• Dynamic information infrastructure• Effective national innovation system

62

Lifelong Learning in the Global Knowledge Economy• Knowledge economy puts premium on
learning• Requires multi‐sector strategy• Focus on equity• Expand access to learning• Raise quality by changing content, pedagogy• Variety of financing mechanisms needed• Policy, institutional, legal framework
63

Learning in Knowledge Economy
Then
Information based
Rote learning
Teacher directed
Just in caseFormal education only
Directive based
Learn at a given age
Terminal education

Now
Knowledge creation/application
Analysis and synthesis
Collaborative learning
Just in time
Variety of learning modes
Initiative based
Incentives, motivation to learn
Lifelong learning

64

Learner‐centered•Learner: motivation, adaptability, analyticalthinking, communication, problem solving•Teacher: from director to facilitator•Implement:
EGRA: Make sure pupils learn to readat the right time
Active pedagogy: One of the mostcritical but difficult challenges our education
systems face (proper pedagogy)
65Learning by Doing• Teacher: from director to facilitator• Classroom: learn by doing, team workand peer learning, individual learningplans• Institution: professional community
centered on achievement66Traditional Learning Differs From
Lifelong Learning
Traditional learning
Teacher is source of knowledge
Learners receive knowledge
Learners work by themselves
Tests given to prevent progress
All learners do same thing
Teachers receive initial training
Good learners identified

Lifelong learning
Educators are guides to knowledge
People learn by doing
People learn in groups
Assessments guide learning
Individual learning plans
Educators are lifelong learners
Access to lifetime learning

67

Alternative Delivery Mechanisms• Increase access to learning opportunities
Increase variety of ways learners can learn
Give access to knowledge resources• Enhance quality through technology
Learning by doingSelf‐directed learning
Continuously updated curriculumNetworks of good practice68

Financing Lifelong Learning• Expenditures increase, public resources
limited• Priority for public: ECD, basic education• Balance between subsidies and market
mechanisms given that– Benefits both private and public– Access to capital uneven

69Governance for Lifelong Learning• Requires multi‐sectoral• Enabling environment for pluralistic
approaches• Focus on equity• Demand‐driven policy

70Characteristics of a Globalized Knowledge
Economy• Rapid and continuous change• Susceptible to global movements of capital• Function of global trading agreements• Quality as important as price• Organizational changes at firm level• Short job tenure in competitive sectors• Fundamentals of macro stability, openness,competition, good governance71Knowledge Assessment Methodology (KAM)• KAM: 76 structural/qualitative variables tobenchmark performance on 4 pillars• Variables normalized from 0 (worst) to 10(best) for 121 countries• www1.worldbank.org/gdln/kam.htm• Basic scorecard for 14 variables at two
points in time, 1995 and 2002

72

Measuring Knowledge for Development73

Measuring Education and Training

74

Core Competencies in the KE• There is no universal definition so far;
• The Definition and Selection ofCompetencies (DeSeCo) Project of theOECD reviewed 12 countries oncompetencies for a knowledge society;• Despite wide variations in definitions ofcompetencies in the 12 countries, the
DeSeCo found some competencies
appearing in most reports.
75

Key Competencies Frequently Cited in
DeSeCo’s Country Reports
High

MediumLow

Social competencies/
cooperation

Self-competence/selfmanagement

Health/sports/physicalcompetencies

Literacy/intelligent andapplicable knowledge

Political competence/democracy

Cultural competencies(athletic, creative,
intercultural, media)

Learning
competencies/
lifelong learning

Ecologicalcompetence/
relation to nature

Communicationcompetencies

Value orientation(Source: Reychen and Salganik 2003)

76

Key Competencies Have Multiple
Dimensions• Complexity and uncertainty of modern life
requires people to apply more than one typeof competency to tackle tasks and issues thatthey face and achieve goals.
• Given this background, the DeSeCo sees thatkey competencies have many dimensions (forinstance, cognitive, motivational, ethical,
volitional, and social components) and they
are interrelated.
• Based on extensive research, including theabove reports, the DeSeCo identified threegroups of key competencies.
77Key Competencies Identified by DeSeCo
Interacting insocially
heterogeneousgroupsActingautonomously

Using tools interactively

To relate well toothersActing within the big
picture or the larger
context

Using language, symbols, andtext interactively (written andspoken, communication,mathematical skills in multiple
situations)

To cooperate

Forming andUsing knowledge andconducting life plans information interactively
and personal projects

To manage andresolve conflict

Defending andasserting one’ rights,
interests, limits, andneeds(Source: Reychen and Salganik 2003)

Using technology interactively(understanding the potential oftechnology and identifying
technological solutions toproblems)
78

The World Bank View
Related to the competencies identified by DeSeCo,
World Bank suggest• Technical skills (literacy, foreign languages
widely used (preferably world-wide), math &science, analytical and so on• Interpersonal skills• Methodological skills (ability to learn, to copewith risk and change, etc.), and• Knowledge and participation in civil society

79

Shapiro et al.,Key Competencies and Skills fromSource:
Employers’
1998
Perspective
 Employers’ hiring criteria in the US

Employers Response to the Question:"what characteristics or attributes are most critical in
making your hiring decision?"

Average of Responses
on a scale of 1 to 5:
1= not at all important …
to 5= essential

C h a r a c te r is tic s
A p p lic a n t's a ttitu d e
A p p lic a n t's c o m m u n ic a tio n s k ills
P r e v io u s e m p lo y e r r e fe r e n c e s
P r e v io u s w o r k e x p e r ie n c e
In d u s tr y b a s e d c r e d e n tia l
Y e a r s o f c o m p le te d s c h o o lin g
A c a d e m ic p e r fo r m a n c e
S c o r e o n te s t a d m in is te r e d a s p a r t o f th e in te r v ie w
T e a c h e r s r e c o m m e n d a tio n s
E x p e r ie n c e o r r e p u ta tio n o f a p p lic a n t's s c h o o l

1994

1997

4 .6
4 .2
3 .4
4
3 .2
2 .9
2 .5
2 .5
2 .1
2 .4

4 .6
4 .1
3 .9
3 .8
3 .2
2 .9
2 .5
2 .3
2
2

 In the United Kingdom, employers reported that communication skills,

learning ability, problem-solving skills, team work and the capacity for selfmanagement were more important than technical, ICT or numeracy skills as
criteria in the recruitment of graduates.
80

Workplace Competencies
The mostly agreed upon workplace competencies
include:• Inter‐personal skills:– Team work and the ability to collaborate in pursuit of acommon objective– Leadership capabilities• Intra‐personal skills:– Motivation and attitude– The ability to learn– Problem‐solving skills– Effective communication with colleagues and clients– Analytical skills• Technological or ICT skills

81Paradigm shifts
The old bureaucratic education system

The modern enabling education system

Hit & miss

Universal high standards

Uniformity

Embracing diversity

Provision

Outcomes

Bureaucratic – look up

Devolved – look outwards

Talk equity

Deliver equity

Received wisdom

Data and best practice

Prescription

Informed profession

Demarcation

Collaboration

82

How can countries ensure that all
students learn?
Students

Teachers

SchoolDirectors

Schools

Local
GovernmentState/Provincial/Regional

Government

National
Government

Employers

PerformanceStandards
Performance
Evaluation
Performance
Reporting
Impact evaluation ofpolicies andprograms
Requirements tooperateEnsuring adequate
and equitable
resources
Autonomy, support,
and intervention
Accountability andconsequences83And finally, let me mention the 10
skills for the future workforce84

1. Sense Making:• The ability to determine the deeper meaningor significance of what is being expressed.
• Simply stated, sense making is critical thinking

85

2. Social Intelligence:• The ability to connect to others in a deep anddirect way, to sense and stimulate reactions
and desired interactions86

3. Novel and Adaptive Thinking:• Proficiency at thinking and coming up withsolutions and responses beyond that which isrote or rule‐based87

4. Cross‐Cultural Competency:• The ability to operate in different cultural
settings

88

5. Computational Thinking:• The ability to translate vast amounts of data
into abstract concepts and to understanddata‐based reasoning89

6. New‐Media Literacy:• The ability to critically assess and develop
content that uses new media forms, and toleverage these media for persuasive
communication.

90

7. Transdisciplinarity:• Literacy in and ability to understand concepts
across multiple disciplines918. Design Mindset:• The ability to represent and develop tasks
and work processes for desired outcomes929. Cognitive Load Management:• The ability to discriminate and filter
information for importance, and tounderstand how to maximize cognitive
functioning using a variety of tools andtechniques9310. Virtual Collaboration:• The ability to work proactively, drive
engagement, and demonstrate presence as amember of a virtual team94