Thursday, 30 June 2016

Skills gap between younger and older Singapore workers: OECD study

Young Singaporeans rank high in OECD study while older ones lag far behind
By Yuen Sin, The Straits Times, 29 Jun 2016

Singapore's younger adults rank highly in numeracy, literacy and problem-solving skills, a major international study has found, but the older generation lags considerably behind. While this reflects the progress in education and training over the decades here, this "skills gap" also highlights that more needs to be done to upgrade the skills of older workers, said experts.

The study of 34 economies by the Organisation for Economic Cooperation and Development, which included Singapore for the first time, also linked higher skill levels to better wages here, another reason for older workers to keep improving themselves.

Still, employers place more premium on qualifications, and a better balance should be found, believes OECD director for education and skills Andreas Schleicher.

The results of OECD's Programme for the International Assessment of Adult Competencies (PIAAC), which also involved countries such as Australia, Japan and South Korea, were released yesterday. Those aged between 16 and 34 in Singapore ranked second behind the Finns in problem-solving using digital tools, fifth in numeracy, which was also topped by Finland, and ninth in literacy, which was led by Japan.

But older adults here aged 45 to 65 performed lower than the OECD average. They were ranked 31st in literacy and numeracy skills and 18th for problem-solving.

The difference in scores between the younger and older generation here is also among the widest when compared with other countries. One reason for the gap, OECD said, could be the survey being conducted in English here. Almost eight in 10 respondents aged above 35 here said they were not native speakers.

Mr Ng Cher Pong, chief executive of the Singapore Workforce Development Agency, believes the difference reflects the marked improvement in Singapore's education and training systems over the last 50 years - including the ramp-up in schools and programmes.

But it is "hugely important" that Singapore finds ways to upgrade the skills of older workers, such as through schemes like SkillsFuture, said Dr Schleicher.

SkillsFuture is a national initiative to equip workers with skills. Doing so could "dramatically raise" Singapore's productivity and keep them employable, he said.

He highlighted how the survey, which involved 5,468 citizens and permanent residents, found that wage levels here were strongly linked to skill and education levels.

An increase of about 48 points in literacy proficiency scores is linked to a 12 per cent increase in hourly wages, almost double the OECD average. About 3.2 extra years in education bring a more than 30 per cent rise in wages - more than double the OECD average.

"Singapore employers pay quite a lot of attention to formal qualifications," said Dr Schleicher. But this might not be a good indicator of one's proficiency.

"It's the use of skills that drives productivity, not years of education," he added.

Brush up or lose out: Message for older adults
Local adults aged 45 to 65 ranked 18th in problem-solving among OECD peers
By Sandra Davie, Senior Education Correspondent, The Straits Times, 29 Jun 2016

The latest findings by the Organisation for Economic Cooperation and Development (OECD) on the skills gap between young adults and older workers in Singapore are not surprising.

The results of the Programme for the International Assessment of Adult Competencies, released yesterday, show that young adults in Singapore aged 16 to 34 had a high level of numeracy, literacy and problem-solving skills.

Compared with their peers from other economies, this Singapore age group ranked second in problem-solving, fifth in numeracy and ninth in literacy.

It was a different story for older adults in the 45-65 age group. Compared with their OECD peers, they were ranked 31st in literacy and numeracy skills and 18th for problem-solving.

The skills assessed in the study are seen to be necessary for adults to actively participate in the labour market, education and civic life. In Singapore, about 5,400 adults - comprising citizens and permanent residents aged between 16 and 65 - participated in the study which covered 34 economies.

The study also found that 74 per cent of those in the 25-34 age group had tertiary qualifications - a polytechnic diploma, if not a degree. In contrast, only 31 per cent of those in the 45-65 age group had tertiary qualifications.

The differences reflect the improvements made in our education and training system over the past five decades. This enabled subsequent generations of younger adults to climb up the education ladder and acquire higher-level skills.

As OECD's education chief Andreas Schleicher said, it is important for the government and employers to look at how lifelong learning can be promoted so that workers, even as they get older, can remain employable.

The distribution of skills has significant implications for how the benefits of economic growth are shared.

These are accentuated in Singapore, which exhibited a powerful correlation between literacy and numeracy skills and wages, ranking third for wage returns to literacy skills.

In Singapore, an increase of approximately 48 points in literacy proficiency score is associated with a 12 per cent increase in hourly wages, which is almost double that of the average among OECD economies covered in the study.

This lends a whole new urgency for older workers to upgrade their skills. Otherwise, they may find the wage gap between themselves and their younger colleagues widening.

Rewarding skills appropriately also has implications for a nation's progress. East Asian nations have not always been known to do this, Dr Schleicher had pointed out last year. He compared the United States and Japan to make his point.

American adults were ranked around the middle in literacy and near the bottom in skills with numbers and technology, but the study found that the American economy was exceptionally good at extracting value from workers.

American companies recognise workers' skills, know how to use them and are willing to pay them a premium for their skills.

The reverse is true for Japan, where rigid labour market arrangements prevent many skilled individuals, notably women, from going into jobs where their skills can be well used.

This close match between skills and wages is something that Singapore should strive to retain. After all, skills are only valuable when they are used effectively and productivity gains can be achieved by engaging workers more fully.

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