US, UK among countries that need to do better on digital up-skilling, warns OECD

Profile picture for user slauchlan By Stuart Lauchlan May 13, 2019
Summary:
The OECD warns that there's a widespread global crisis when it comes to getting the skills in place to thrive in a digital economy.

The digital skills crisis is a topic that transcends national boundaries. It’s a problem for the US, the UK, most of Europe, for example, and one that governments and orgnanizations in all of those geographies have pledged to tackle - several times over.

The bad news? Only a handful of countries have cracked it - and it’s not the bigger economies that are ahead of the pack. According to a new study from the Organization for Economic Co-operation and Development (OECD), Belgium, Denmark, Finland, the Netherlands, New Zealand, Norway and Sweden are the nations best placed for the future.

Japan and Korea are on the ‘could do better’ list, while the likes of Greece, Italy, Lithuania and Turkey have a massive job to do to catch up.

The OECD report - Thriving in a Digital World - cautions that:

Digitalisation presents immense potential to boost productivity and improve well-being. It can give people more power over what they learn, where and when they work, and how they engage in society. However, it can also increase inequalities if some people or regions are left behind. By improving the skills of their populations, countries can ensure the new technologies translate into better outcomes for all. This requires a comprehensive and co-ordinated policy intervention, with skills-related policies as the cornerstone of this package.

That’s pretty much a statement of the obvious of course. What’s more interesting is an argument pitched by the OECD that what’s undermining efforts in many nations is that the solution to the problem is often assumed to be access to computers and computing resources and as such the right approach is to throw money at the problem.

What’s actually needed is a radical reform of the education process to become a life-long, ongoing exercise as tech innovation creates an ever-changing demand for new skills to accompany each fresh development. The current debate around the spread of automation and its consequent impact on jobs is just one case in point. The study suggests that more than half of those occupations (54%) at high risk of automation will need either a moderate (less than one year) or severe (more than one year) training for workers to transition to new roles.

Moreover, just focusing on digital and technical skills is not an appropriate plan of action, warns the OECD. Tomorrow’s workers need training in cognitive and socio-emotional skills so as to provide the human x-factor that their robot colleagues can’t.

Rounded

Launching the report, OECD Secretary-General Angel Gurría said:

A well-rounded skillset is critical to unlocking the benefits of digitalisation. However, the OECD Survey of Adult Skills (PIAAC) reveals that 15% of adults lack basic digital skills, and 13% lack basic digital, numeracy and problem-solving skills. This is really scary, as citizens without basic skills are at risk of being left behind by the digital transformation. Moreover, on average in the OECD, 6.6% of young graduates have low literacy and numeracy skills. But this share goes up to almost 20% in some countries. This means that holding a tertiary degree does not always guarantee a high level of skills.

New technologies are changing the way we carry out our jobs. In the digital age, workers must be mobile and able to retrain and upskill along the course of their lives. Our estimates suggest that 14% of jobs (on average) across the OECD face a high risk of being automated and many more jobs – 32% – are expected to undergo substantial changes in terms of the quantity and quality of their tasks. It is imperative that workers retrain and upskill to face these enormous challenges. However, workers in occupations at high risk of automation and the low-skilled are less likely to participate in on the job training than other workers.

That’s the case in both the US and the UK. For the US, the report finds an average level of skill proficiency relative to other OECD countries, but that the share of young people lacking basic skills is high. Across the US population, 10.2% of workers are in occupations at high risk of automation and would need moderate training to move into occupations with low or medium risk of automation. Workers with exposure to automation and the low-skilled participate less in training than workers at low-risk of automation and high-skilled workers.

It’s also a mixed picture for the UK, with the share of young people lacking basic skills relatively high, but the share of older people with low skills actually coming in below the OECD average. Meanwhile 13.7% of workers are in occupations at high risk of automation and would need moderate training efforts (up to 1 year) to skill up for safer roles. And here’s the problem - the number of UK workers in Adult Learning is above the OECD average, but workers more exposed to high job risk from automation take part less than those at low risk.

My take

This is a comprehensive review of the state of global skills crisis. The results, unsurprisingly, make for downbeat reading in many quarters, not least those industrialized countries with strong economies, but alarming future prospects. America’s potential skills problems aren’t going to make many great, while the challenges a post-Brexit UK will be facing anyway aren’t going to be made any easier in a digital economy unless there’s some course correction. Will anything much result from this? Possibly (probably) not. The OECD calls for a different approach to government intervention and to cross-border co-operation. The political direction of travel in some of the countries with room for improvement on the upskilling front is however all too often going heading the other way…