Challenges in Human Resource Development in Asian Countries 2002. 11

Sangwon Ko [email protected]

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New Challenges in HRD

•

What is HRD ? Activities of education, initial training, continuous training, and lifelong learning that develop and maintain individuals’ employablity and productivity over a lifetime

•

Drivers of changes: Globalization, Skill-biased Technological Change, New work organization(IT & decentralization)

•

Proactive function and Remedial function of HRD

Source: ILO, Training for employment: Social inclusion, productivity,and youth employment, http://www.ilo/org/public/english/standards/relm/ilc/ilc88/rep-v.htm

2

Identifying Trends Of Upskilling

•Unemployment rate of the unskilled increases (European Countries) • Wage premium of the skilled increases(US) • Inequality of income distribution increases In case of Korea, however, unemployment rate of the educated has increased and educational wage differential has narrowed even with skill-biased technological change. 3

1

Consequence of Rapid expansion of university education Due to the rapid expansion of university education during 1980’s, qualified workers poured into t he labor market. The unemployment rate of the highly educated has been greater than the total unemployment rate. As sudden external shock, the Asian financial crisis, hit the labor market in last quarter of 1997, the unemployment of the uneducated started to increase much faster than that of the educated. Since 1998, the unemployment rate of the highly educated has been lowe r than that of less educated. Z Y PW

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Source : National Statistical Office, Economically Active Population Survey, various years 4

Declining educational wage differentials in Korea The educational expansion not only leads to a rise in the unemployment rate of the highly educated but also to a drop in wage differentials by educational levels. Until the mid-1980’s the average wage of college graduates was 2.3 times greater than that of high school graduates, and in 2000 the avera ge wage of college graduates was only 1.5 times greater than that of high school graduates. The av erage wage of junior college graduates, which was 1.5 times greater than that of high school graduat es in 1980, dropped to only 1.03 times greater than that of high school graduates in 2000.

Change in Relative Average Wage by Educational Qualifications ( Average Wage of High School Graduates = 1)

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Source: Ministry of Labor, Survey Report on Wage Structure, Various Years

5

Population Statistics for selected Asian Countries(2000)

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Source: Korea National Statistical Office, 2002, Main Statistical Indicators in APEC

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Economically Active Population and Labor Force Participation Rate For Selected Asian Countries

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Source: Korea National Statistical Office, 2002, Main Statistical Indicators in APEC

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Employment by Industry for Selected Asian Countries

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Source: Korea National Statistical Office, 2002, Main Statistical Indicators in APEC

8

Availability of Skilled Labor for Selected Asian Countries

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Source: IMD, The world Competitiveness Yearbook 2001

3

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Enrollment Ratios for Secondary and Tertiary Education

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Source: Korea National Statistical Office, 2002, Main Statistical Indicators in APEC

10

Industrial restructuring and the education and Training System The education and training system need to evolve in unison with industrial restructuring. Korea’s experience can shed light on other Asian countries. Evolution of education and training system of Korea More responsive responsive education education and Training System Qualitative Improvement of Training and Education Expansion of Universities and vocational Junior Colleges

- Continue

Expansion of technical high school

- From light Industry to Heavy and Chemical Industry - Specialized technical high school is expanded (I.e., machinery)

-Restructuring toward skill intensive Industries - Emphasis is given to producing highly educated workers - The number of university degrees awarded annually more than tripled during the 1980s.

1970s

1980s

to Increase support for university research(BK21) - reinforce vertical and horizontal linkage in vocational education along with school-industry partnership at the local level - Foster Institutional diversity through autonomous decision making of schools

- Research funding had been substantially increased - Special funding for selected Graduate Schools - Evaluation of Universities Is linked with funding - The number of technical high School had been doubled .

1990s

2000

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Challenges to the Korean education system

• Two thirds of educational expenditure comes from private source and private schools constitutes 90% of the tertiary level educational institutions - However, type of schools, student admission, curriculum, teacher hiring are strictly regulated by central government

• Gender bias is deeply embedded in Korean culture and tradition. 38% of tertiary enrolment: female • Need qualitative improvement to meet the new skill requirements • The linkage between industry and university is weak. • Lack of sound incentive system for teachers : seniority-based pay • Inbreeding is prevalent in hiring professors. • Government mandated criteria for setting up campus deter foreign institutions to provide educational service in Korea.

Deregulation & decentralization

Gender, relevance, & quality

Challenges to the Korean Education System

Lifelong education

• Informal, vocational and distance education system are not integrated with formal one. • ICTs are not fully exploited in areas such as distance learning and cyber universities. • Recognition and rewards for improved skills in workplace are necessary. Performance-based pay • Access to knowledge and information for all, especially for the poor need to be stressed. • New initiatives : credit bank system self-study

Diversification

• Korean Universities operates in a “department store” style, offering similar curriculum. • Local universities fails to meet local needs. • Vocational institutions and general secondary schools are even less diversified than universities. • Growing needs for inter or multi-disciplinary programs

Source: The World Bank and OECD(2000) Korea and the Knowledge-based Economy: Making the Transition 12

4

Quantity OR Quality There are three ways to adjust the supply to correct mismatches between demand and supply; a)shift supply curve vertically, b)shift supply curve horizontally, c)shift supply curve both vertically and horizontally. Shifting supply curve upward can be called as a quantity increasing policy and shifting supply curve to the right can be called as a quality improving policy.

Policy options of adjusting supply of labor

Diagrammatic model of labor demand and supply

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Quality

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Quality b)quality improving policy

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Categorization of Policy Alternatives in Human Resource Development • • • • • • • •

Providing a basic education Analyzing the labor market to allow sound forecasting of trends and needs in HRD Increasing the supply and enhancing the quality of managers, scientists, entrepreneurs, and teachers Reducing skills deficiencies and unemployment by training program Improving the quality of curricula, teaching method and instructional material Increasing opportunities for people seeking to gain skills Preparing organization and individuals to remain productive in the face of rapid economic and technological change Promoting HRD toward the liberalization of trade and investment

Source: ECOTECH ACTION PLAN(2002), http://www.apec-ecotech.org

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