OECD Stresses Value of Education, Including Vocational Programs

June 26, 2013

In the half decade since the onset of the global economic crisis, the employment and earnings gap between well- and ill-educated young people has widened, according to a new report from the Organisation for Economic Cooperation and Development, which says that unemployment rates are nearly three times as high for people without a high-school diploma as for those with a college degree.

The findings, which underscore the long-term value of educational attainment, are among the results in "Education at a Glance 2013: OECD Indicators," the latest edition in an annual series that analyzes education data from the Paris-based group's 34 member countries. They include many of the world's most developed economies as well as emerging countries such as Chile, Mexico, and Turkey. As in previous years the report also analyzes data from seven nonmembers, including Brazil, China, India, Russia, and South Africa.

The report examines rising overall unemployment levels, a rapid increase in higher-education attainment levels in OECD countries, a surge in the number of internationally mobile students, and declining levels of public spending on higher education, among other global trends.

Young people have been hit especially hard by unemployment and underemployment, and the report explores the factors that have produced striking disparities among countries. It concludes that the countries that have fared best were those with a higher-than-average proportion of vocational-education graduates, such as Austria, Germany, and Switzerland, which were able to keep their increase in youth unemployment below eight percentage points.

In sharp contrast, countries with a lower-than-average proportion of vocational graduates, such as Greece, Ireland, and Spain, saw increases in youth unemployment of 12 percentage points or more. Vocational programs, which have drawn growing interest in other nations, including the United States, "play a critical role in strengthening countries' capacity to deal with rapidly changing labor-market conditions," the report says.

Unexpectedly, the report says that unemployment rates for graduates of computer and information-technology programs, who might expect to land well-paying jobs, were higher than for graduates of secondary-school teaching programs, who are likely to earn far less. "The relationship between students' career choices, skill development in a particular field of study, and actual employability is more complex than often assumed," the report observes.

Rising Demand, Falling Spending

The persistence of the economic downturn and the bleak employment situation have evidently persuaded some young people that their best option is to continue their schooling, with a 1.5-percent increase in the number of 15- to 29-year-olds remaining in education since 2008. The overall rate of higher-education attainment in OECD countries has risen by almost 10 percentage points since 2000.

That increased demand has not, however, resulted in a concomitant increase in public spending on higher education, which has declined as a percentage of GDP across the OECD since 2009. The share of public spending on higher-education institutions has dropped since 1995, according to the report, from 77 percent at that time to just 68 percent in 2010.

The report also highlights the changing American role in global higher education. The United States continues to rank highly among OECD countries in overall levels of higher-education attainment, placing fifth among 25- to 64-year-olds, but is rapidly losing ground, falling to 12th place among 25- to 34-year-olds.

Similarly, although the United States still plays host to more international students than does any other country, its 17-percent share of the foreign-student market is falling quickly. The size of this group more than doubled from 2000 to 2011, to 4.3 million students, with an annual growth rate of nearly 7 percent. In 2000, 23 percent of those students chose the United States as their destination, but by 2011 the figure had dropped to 16 percent.

Other popular destinations, such as Germany, have also seen a decline, while Australia, Britain, Russia, South Korea, and Spain have increased their share. According to the report, those shifts could be due in part to "differences in countries' approaches to internationalization, ranging from marketing campaigns in the Asia-Pacific region to a more local and university-driven approach in the United States."

The United States also stands apart from other OECD countries in the relatively high tuition rates its public universities charge. Higher education remains largely tuition-free in some OECD members, such as the Nordic countries and Germany. However, the report found no strong correlation between tuition fees and access to higher education in the United States.