Education and Employment

Education and Economic Growth See also: Adult Education and Training: Cognitive Aspects; Economic Growth: Measurement; Economic Growth: Theory; Education and Employment; Education and Income Distribution; Educational Institutions and Society; Educational Policy, Mechanisms for the Development of; Educational Productivity; Human Capital: Educational Aspects; Literacy Education; Vocational Education and Training

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ation and Economic Growth: The Theory and Practice of Learning Regions. Edward Elgar, Lyme, NH Carnoy M 1995 International Encyclopedia of Economics of Education, 2nd edn. Pergamon, New York Cipollone P 1994 Education and earnings. In: Huse! n T, Postlethwaite T N (eds.) The International Encyclopedia of Education. Pergamon, New York Vol 3, pp. 1655–60 Decker P T, Rice J K, Moore M T, Rollefson M R 1997 Education and the Economy: An Indicators Report. US Department of Education, Washington,  Filmer D, Pritchett L 1999a The effect of household wealth on educational attainment: Evidence from 35 countries. Population and De
elopment Re
iew 25: 85–120 Filmer D, Pritchett L 1999b Educational enrollment and attainment in India: Household wealth, gender, village and state effects. Journal of Educational Planning and Administration 13: 135–63 Glewwe P 1999 The Economics of School Quality In
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eloping Countries: An Empirical Study of Ghana. St. Martins Press, New York Lo! pez R, Thomas V, Wang Y 1998 Addressing the Education Puzzle: The Distribution of Education and Economic Reform. World Bank, Washington,  Mayer S E, Peterson P E 1999 Earning and Learning: How Schools Matter. Brookings Institution Press, Washington,  O’Connell P J 1999 Adults in Training: An International Comparison of Continuing Education and Training. Organization for Economic Cooperation and Development, Paris Organization for Economic Cooperation and Development 2000 Education at a Glance: OECD Indicators – Education and Skills. Organization for Economic Cooperation and Development, Paris Schultz T W 1961 Investment in human capital. American Economic Re
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Woodhall M 1994 Human capital concepts. In: Huse! n T, Postlethwaite T N (eds.) The International Encyclopedia of Education. Pergamon, New York Vol 5, pp. 2643–7

D. W. Cheek

Education and Employment Schooling is a social mechanism which, as a rule, dissociates the learner physically for a certain life period from the regular world of work and other life spheres. This is undertaken in order to prepare learners in a more rational manner for coping successfully with the diversity of work and other life tasks through explanations, rules, general reasoning strategies, etc. The more efficient the industrial society became in producing wealth, the more the education system and generated competencies contributing to the production of goods and services expanded. Regarding the world of work, education has: (a) a qualifying (in the French and German connotation) function of fostering the cognitive and possibly affective and sensorimotor capabilities which might be useful to cope with job tasks; (b) a status-distributive function: the level of ‘educational attainment’ determines to a certain extent the monetary resources and the social recognition which will be available to individuals in their subsequent life; for education is a powerful factor—and has increasingly become so over the nineteenth and twentieth century—in opening up or closing access to prestigious occupations and providing the means for professional achievement and thus to remuneration and socioeconomic status. These basic functions are undisputed. However, it is generally assumed that education is bound to be imperfect in preparing for the world of work, partly because rational learning through dissociation from practice has its price in less direct preparation for occupational tasks and because education is expected to serve broader functions. Also, other factors contribute to professional success, e.g., sociobiographic background, genetically determined abilities, specific dynamics of credentials, processes of transfer from education to employment, and finally lifelong learning and personal development. Thus views vary as regards to the actual ways education is and ought to be shaped as well as the actual impacts learning has and ought to have on subsequent employment and work.

1. Imperfections and Limits of the Linkages of Education and Employment Even if education was expected to be closely geared to the ‘requirements’ of the employment system and particularistic social factors were in play there are

Education and Employment obvious imperfections and uncertainties which make close linkages unlikely. Available research and past debates for instance pointed out the following issues: (a) Occupational dynamics: The employment system is very dynamic in terms of changes of job tasks within given occupations, and most people have to expect occupational mobility in terms of employers or occupations. This challenges the view that one should prepare for a very specific bundle of job tasks. (b) Indeterminate work tasks for highly qualified workforce: The higher the educational level required for a certain occupational area, the more difficult it is to identify the competencies required. (c) Planning gap: There is an unavoidable time gap between the identification of new job assignments and the provision of respective competencies on the part of school leavers and graduates, because years are needed for the revision of curricula, and the actual ‘production’ of new graduates. (d)Generalists’ vs. specialists’ paradigms:Views vary among experts regarding the extent to which education should be general or specialized according to areas of knowledge or occupations. (e) Emphasis on vocational education vs. recurrent education: Finally, views differ similarly on the extent to which the growing role of lifelong learning might reduce the need for pre-career vocational or professional education and training, on the change of learning abilities over the life course, job requirements in different career stages, and the economic and social conditions for lifelong learning (cf. Schuller and Tuijnman 1999). In all societies, controversies can be observed as regards the extent to which education is viewed as instrumental in securing the individual’s and the society’s economic success. There are also strong national differences with respect to four areas of values. (a) An ‘educational meritocracy,’ i.e., a strong impact of vocational educational attainment on subsequent career, seems to be realized most and highly appreciated in Japan, whereas lifelong opportunities for counteracting those links are emphasized in the USA. (b) A general or specific approach of education and training: Where a generalist’s view prevails, for example in Anglo-Saxon countries and in Japan, specialized training tends to be viewed as ‘narrow’ both in terms of restraining professional flexibility and personality development. Where a specialist’s view dominates, notably in France and to a certain extent in Germany, the acquisition of specific knowledge is considered as a process of exemplary in-depth learning which ensures substantial transfer to other areas of expertise, and is viewed as compatible with a broadly cultured personality. (c) Concepts of employment and work-related identity: In France and Germany, employment and work are generally expected to be a major force for

individual identity. This tradition has reinforced a high level of pride in skilled workers in Germany. In contrast, sense of affiliation to one’s own employing organization tends to be viewed as a major source of identity and pride in Japan. In the Anglo-Saxon tradition, identity linked to work seems to be a phenomenon confined to high-level occupations, as the distinction underscores between (high-level) ‘professions’ and other ‘vocational’ areas. (d) The role policies actually play and should play in shaping the relationships between education and employment: In the Soviet Union and affiliated countries, strong efforts were made from the 1950s through the 1980s to plan education according to the perceived demands of a planned economy. In the USA, faith in the self-regulatory forces is most widespread as far as educational preparation for employment and work in a market-driven economy is concerned. In European countries, different degrees of macroplanning and steering of education are considered essential in order to strike the balance between economic and other social and cultural rationales of education in a predominantly market-driven economy. The different values are so pertinent for the actual links between education and employment in the respective societies that interpretations of research findings and discussions of their policies are most likely to reinforce national characteristics of education–employment relationships.

2.

Trends of Educational Attainment

Expansion of education seems to have been a perennial trend since World War II. On average, about one third of the adult population in industrial societies had at least some upper secondary education in 1960; this proportion reached two-thirds in the late 1990s (OECD 2000). From the late 1950s through the early 1970s, optimism prevailed that the economy requires a substantial increase of labor with advanced levels of education and that educational expansion is instrumental to economic growth. Comparisons focused on general and full-time schooling, thus neglecting vocational training. Accordingly, full-time enrollment rates of 17 year olds were 86 percent in the USA in 1970, about three-quarters in Canada and Japan, but only ranged in Western Europe from about 60 percent in Sweden to about 20 percent in Germany (OECD 1977). Average years of schooling, measured in 1975, ranged from about 11 years in the USA and the UK to less than six years in France, Spain, and Portugal. The 1973 ‘oil crisis’ was a turning point of the political mood, and concern about unemployment in general began to dominate over problems of employability of youth and potential mismatches between education and employment due to an over4179

Education and Employment Table 1 Percentage of population from select countries having attained at least upper secondary education and university-level education, by age group 1998 University-Level Age Group

Upper Secondary Age Group Country USA Norway Japan Germany Czech Republic UK France Philippines Jordan Spain Argentina Turkey China Zimbabwe India

25–34

35–44

45–54

55–64

25–34

35–44

45–54

55–64

88 93 93 88 92 63 75 56 48 53 36 24 18 16 11

88 88 91 87 88 62 63 53 41 38 29 19 22 14 9

87 79 77 84 84 58 56 35 28 23 21 13 10 14 6

80 65 57 76 74 53 41 35 15 12 15 7 10 12 3

27 27 23 14 7 17 15 26 30 21 11 7 5 2 8

26 25 23 16 5 17 10 26 26 16 10 7 3 2 7

29 22 15 15 5 15 10 18 18 11 7 6 3 2 5

22 12 9 10 3 11 6 18 9 6 4 3 3 2 3

Source: OECD 2000, pp. 37–8.

supply of labor with higher or other advanced levels of education and training (OECD 1977). At that time, the OECD began to include part-time enrollment and apprenticeship training into their figures of upper secondary enrollment, thereby observing an average increase of the secondary education graduation quota from about 60 percent in industrial societies around 1970 to more than 80 percent in the late 1990s. Differences ranged from more than 90 percent in 1998 in New Zealand, Japan, and Germany to less than 60 percent in Portugal (OECD 2000). Similarly, the proportion of the respective age group being awarded a university-level degree increased from less than 10 percent on average in industrial societies around 1970 to almost 20 percent at the end of the century. A comparison of the educational attainment (Table 1) shows that the differences between the age groups are small in the USA, where the major expansion of enrolment took place before the 1970s, and high in Spain, where educational expansion is most pronounced in recent decades.

3. Income Differences by Education In all societies, educational attainment and income correlates. In European OECD member states, for example, those with upper secondary education earned on average in the 1990s about 1.3 times, those with nonuniversity tertiary education 1.5 times and those with university-level education about twice as much as persons without upper secondary education (see OECD 2000). Income differences according to educational attainment tend to be higher for women than 4180

for men, though they earn less than men. Differentials declined moderately on average over the last three to four decades of the twentieth century, though not consistently over time and across countries. Variations across countries cannot fully be explained by patterns of supply and demand; other social factors come into play which contribute to varying income inequality. Calculations based on the human capital approach show that individual returns for higher education vary between countries from less than 5 percent to more than 20 percent. In some countries they surpass the interest rates of business capital whereas in others, they remain below that level.

4. The ‘Match’ between Education and Employment The extent to which educational qualifications match the employment demands is a frequent topic of debate. One tries to establish—both for recent graduates and the total labor force—whether qualifications correspond to the occupational structure (a) horizontally (links between subjects and occupational categories), or (b) vertically (appropriateness of the level of education to the occupational status). Altogether, concerns about a horizontal match are more pronounced in countries emphasizing specialization in education and employment than in countries considering education predominantly as a general preparation. They tend to be more pronounced as well regarding higher levels of education than lower ones: A substitution of a car mechanic by a baker seems to

Education and Employment be more acceptable than that of an engineer by a chemist. But more leeway for substitution exists than expected. For example, the fact that about half of the Germans having undergone an apprenticeship training are employed five years later in occupations not closely linked to the type of training does not tend to be considered as a major wastage, but rather as an indicator that in-depth specialized vocational training fosters substantial potentials for flexibility and transfer of skills. More attention has been paid to problems linked to possible vertical mismatches. In the 1960s, concern was frequently voiced that countries with a low proportion of the population with advanced education might fall behind the others with respect to economic growth. From the 1970s through the 1990s, in contrast, the controversies on the agenda concerned whether a trend toward ‘overeducation’ or ‘overqualification’ could be observed. During the 1990s, a mix of concerns about overeducation in some areas and lack of competencies in other areas, e.g., qualifications required for new technologies, was prevalent in many countries. ‘Overeducation’ and in some cases ‘undereducation’ was analyzed with the help of various measures (cf. Hartog 2000, Paul et al. 2000): (a) Educational and occupational statistics seem to suggest that the expansion of advanced levels of education clearly surpassed the demand of the employment system. (b) Employers’ expectations similarly tended to support the idea of substantial increase of ‘overeducation’ in the 1970s and 1980s, though they also point out lack of competencies in some domains. Surveys of former students also show a higher frequency of education seemingly surpassing the level of job requirements than that of ‘undereducation,’ but they indicate that many graduates make use on the job of the higher level of competencies. The progress of research notwithstanding, the issue of ‘overeducation’ seems to be perennial, because the tensions do not fade away between often steep occupational hierarchies and a relatively open access to the highest levels of education. However, concern tended to be voiced less dramatically in the 1990s than in the 1970s (Teichler 1999). This might be explained by widespread expections that a ‘knowledge society’ is likely to emerge. Also, research has shown that most persons seemingly overqualified acquired a position only slightly lower than they had strived for.

5. Education, Unemployment, and ‘Employability’ Youth unemployment and various modes of precarious employment became a major concern in most industrialized societies since the mid-1970s and in

most developing countries for long periods. The unemployment quota among youth is substantially higher than that of the total labor force in most countries. Also, in most industrial societies, the higher unemployment quotas are, the lower is the level of educational attainment. OECD calculations made in the late 1990s suggest that Europeans trained below upper secondary education have to expect four years of unemployment over their life course, those trained on upper secondary education somewhat more than two years, and those trained on tertiary education level somewhat more than one year. This led to a growing attention to the education of persons not achieving advanced levels of education, called for example, ‘the forgotten majority’ or the ‘forgotten half.’ A discussion was triggered as to whether an expansionist education policy could strengthen the employability potentials of young people and whether certain types of education and training were more successful than others in preparing youth for the world of work. Various models were suggested to classify modes of vocational education and training on secondary education level (cf. Tessaring 1998). During the late 1970s, the apprenticeship training model (Lutz 1994) became popular in international debates, because the youth unemployment rate in Germany and neighboring countries was not substantially higher than overall unemployment rates. During the 1980s, the pendulum of debate swung in favor of a general approach of vocational education combined with initial and further on-the-job training within the employment system, as customary in Japan (Dore and Sako 1989). Efforts were also made to increase educational and training opportunities in countries previously characterized by a low enrollment rate at the upper secondary education level. Recently new mixes of education and work experience have emerged without any single model being regarded as clearly superior.

6. Transition from Education to Employment In the 1990s, increased attention was paid to the processes of transition from education to employment. An OECD study defined transition as a period of up to 10 years when youth might be searching for a satisfying and well-paid job, orientation and efforts to supplement competencies might interact, and employment opportunities might differ from those for the older workforce (Werquin et al. 1997, OECD 1999). Part of the respective research focuses on the job start as a major indicator of the relationships between education and employment. Other studies analyze the speed of transition and the frequency of unemployment and precarious employment over various years. A further type of analysis tries to examine whether the process of transition is facilitated by certain types of 4181

Education and Employment prior education and training, e.g., a close ‘coupling’ of education and training to respective occupations, notably through the apprenticeship systems (cf. Shavit and Mu$ ller 1998), whereas others consider ‘market’ regulation, as observed notably in the USA, as most promising because it facilitates adjustments at any time in the career. Various studies address factors other than educational achievement that might explain transition to employment and further career. ‘Credentials,’ for example, both certify and symbolically overemphasize educational achievements. Also, sociobiographic background comes into play not merely in terms of particularistic advantages in the transition processes, but also as in terms of social skills not taught through formal educational processes. Further, the terms of ‘key qualifications’ point out the importance of competencies in part fostered by education and training. Moreover, transition from education to employment also can be viewed as a moment under reduced meritocratic rule when young people can seek for chances through diligent search, smart tactics, and the demonstration of talents so far not rewarded in education. Finally, some analyses indicate moderate impacts of targeted measures of improving transition to employment, notably short training programs for ‘at-risk youth’ and occupational guidance and counseling as well as placement arrangements by public employment agencies, private recruitment, and placement firms, and by placement support on the part of educational institutions.

7. Concluding Obser
ations Education became increasingly an important determinant of employment and career in the nineteenth and twentieth centuries. By and large, long periods of vocational learning are rewarded by a higher status and more interesting and independent work. However, this is affected by labor market situations of demand and supply. Also, education becomes, in the process of expansion, more and more a prerequisite for career success, whereby other factors might gain weight with respect to the details of selection and allocation. Finally, the growing dynamics within the occupation system make the influence of vocational education less visible when life-long education grows. International comparison has pointed out a striking variety of modes of education and training and of links between education and employment. The debates continue on the virtue of general vs. specific education, on hopes set in educational expansion vs. a closer match between education and the demands of the economy, on the advantages of a close coupling between training and work vs. open market regulations, etc. But international comparison also questions the beliefs widespread in the 1960s that one could identify the most successful, modern way of shaping 4182

the education system in a most promising way for serving economy, culture, and personality development. This did not necessarily lead to a dominance of relativistic approaches, but rather often stimulated the search for new mixes, e.g., in combining general education with work experience, opening up avenues for tertiary education while intensifying measures for educationally disadvantaged youth, improving education and concurrently measures that address the transition processes directly as well as ‘employability’ in other respects. Even in a ‘knowledge society,’ one does not expect that a more or less pure educational meritocracy will emerge, because other factors might increasingly gain momentum. But education seems to remain the single most important determinator of career and other life chances. See also: Adolescent Work and Unemployment; Education and Income Distribution; Educational Sociology

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U. Teichler Copyright # 2001 Elsevier Science Ltd. All rights reserved.

International Encyclopedia of the Social & Behavioral Sciences

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