Education as Change
ISSN: 1682-3206 (Print) 1947-9417 (Online) Journal homepage: http://www.tandfonline.com/loi/redc20
The ideological underpinnings of World Bank TVET
policy: Implications of the influence of Human
Capital Theory on South African TVET policy
Siphelo Ngcwangu
To cite this article: Siphelo Ngcwangu (2015) The ideological underpinnings of World Bank
TVET policy: Implications of the influence of Human Capital Theory on South African TVET
policy, Education as Change, 19:3, 24-45, DOI: 10.1080/16823206.2015.1085620
To link to this article: http://dx.doi.org/10.1080/16823206.2015.1085620
Published online: 23 Oct 2015.
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THE IDEOLOGICAL UNDERPINNINGS
OF WORLD BANK TVET POLICY:
IMPLICATIONS OF THE INFLUENCE OF
HUMAN CAPITAL THEORY ON SOUTH
AFRICAN TVET POLICY
Siphelo Ngcwangu
University of the Witwatersrand
Siphelo.Ngcwangu@wits.ac.za
ABSTRACT
From taking a long-standing position against TVET, the World Bank’s most
recent education policy has seen a shift to its promotion and then a seeming
retraction. The World Bank argues that the occupational route to skills training
is the better way to go. The Bank argues that the occupational route rather
than general education provides better opportunities for employment in the
labour market. The change in opinion – ironically for a bank devoted to market
functionality – is a market failure in matching skills to employment opportunities.
The World Bank defines the growth of the demand of TVET in many regions
as resulting in a need for quality promotion, stronger regulation and allocation
of more financial resources towards TVET. Recent academic critiques (Klees,
Samoff & Stromquist 2012) of the World Bank’s 2020 (hereafter referred WBES
2020; World Bank 2011) strategy have looked at the broad educational focus of
the WBES 2020. This article focuses on the Technical and Vocational Education
and Training (TVET) aspects of WBES 2020. The World Bank has sought to go
beyond financial lending and structural adjustment, which defined its policies
in the 1970s and 1980s to ‘policy lending’ in which it uses intellectual capital
to recommend policies for developing countries. These policies are premised
university
of south africa
Education as Change
Volume 19 | Number 3 | 2015
pp. 24–45
DOI: 10.1080/16823206.2015.1085620
Print ISSN 1682-3206 | Online 1947-9417
© 2015 The University of Johannesburg
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Ngcwangu
The ideological underpinnings of World Bank TVET policy
largely on human capital theory assumptions about skills and education with
a strong emphasis on ‘work relevant’ skills for development. A change in
World Bank education policies since the 1980s is important to observe. It is
apparent that the Bank’s lending portfolio for Vocational Education has declined
significantly in the early 1980s until the mid-1990s against the backdrop of the
Bank encouraging developing countries to invest more in basic education. This
article analyses the convergence between national TVET policy of South Africa
and the World Bank’s commitment to a market-driven approach to TVET. It argues
that such an approach overlooks the possibility of alternative conceptualisations
of TVET, which prioritise social justice and sustainable development. Given the
deepening capitalist crisis as seen by the 2008 global financial crisis and the
failure of market forces to create conditions for inclusive economic development,
it is critical for TVET policy to be philosophically orientated towards promoting
democratic citizenship towards a truly substantive democracy. What I show in this
article is that the recent World Bank policy on TVET has internal contradictions
and its recommendations are not likely to assist poor countries in dealing with
socio-economic problems as they prioritise supply-side restructuring rather
than broader economic structural reforms. One of the fundamental internal
contradictions in the World Bank’s approach to education is that it maintains
that ‘skills mismatches’ can be explained by market failure, yet it implies that the
‘skills mismatches’ will be solved by the market.
Keywords: World Bank, human capital theory, neoliberalism, ideology, skills,
employment, policy development, labour market
INTRODUCTION
Established as the International Bank for Reconstruction after World War II at the
settlement of Bretton Woods, the World Bank started off with the specific aim of
assisting countries in their efforts of reconstruction following the end of World War
II. Over the years since the 1960s, the World Bank’s role has expanded in particular
in relation to developing poor countries of the South mainly in Africa. The heavy
indebtedness of the African countries in the post-colonial period resulted in the World
Bank seeing this crisis as an opportunity to impose its infamous structural adjustment
programmes (SAPs) on these countries, which kept some African countries under
the policy control of the World Bank whereby they had to comply with the economic
policy prescripts of the Bank.
International agencies and multilateral bodies such as the World Bank,
International Labour Organisation (ILO), International Monetary Fund (IMF) and
other such structures have produced a variety of policy recommendations on skills
and vocational education that have largely advanced a neo-liberal approach to
skills development and vocational education. These have had a strong influence on
education policy making in developing countries particularly over the last twenty
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The ideological underpinnings of World Bank TVET policy
to thirty years. Within the rubric of globalisation, the World Bank’s policies on
education, TVET and skills have emphasised the importance of ‘market efficiency’
in determining national education and training policies. Notions of market efficiency
in education have had a bearing on educational policies in many developing countries
such as South Africa and other countries. Education and training reforms in South
Africa, such as Outcomes Based Education (OBE) and similar ‘market friendly’
policies, have had disastrous results in the schooling sector and also in the postschool state regulated training system.
Baatjies, Baduza and Sibiya (2014:91) state that, as in other countries, South
Africa is re-orienting its TVET system in order to harness TVET to national
economic objectives as set out in National Skills Development Strategy (III), the
National Development Plan (NDP) and various skills projects intended primarily to
serve business and industry interests and to meet the singular interests of a largely
unreconstructed labour market. As a result, the prevailing human capital policy
in South Africa promotes an education and training culture marked by training
orientated towards industry’s need for a highly skilled and flexible workforce
necessary for competitiveness in the global economy. The challenge is how TVET
can contribute to efforts at transcending the capitalist crisis rather than reinforcing
its logic. This article addresses this concern by: (i) critiquing the ideological
assumptions underpinning WBES 2020; and (ii) examining and critiquing the
ideological assumptions underpinning South African TVET policy.
A CRITICAL OVERVIEW OF WORLD BANK POLICIES
ON EDUCATION, TRAINING AND SKILLS
In a sense, the World Bank has sought to go beyond financial lending and structural
adjustment that defined its policies in the 1970s and 1980s to ‘policy lending’ in
which it uses intellectual capital to recommend policies for developing countries.
These policies are premised largely on human capital theory assumptions about skills
and education with a strong emphasis on ‘work relevant’ skills for development.
There are two sets of writings that respond to two different World Bank policies on
education, training and skills development. The first set is in response to the 1999
World Bank Education Sector Strategy and the second is based on the 2011 World
Bank Education Strategy 2020. A change in World Bank education policies since the
1980s is important to observe, since it is apparent that the Bank’s lending portfolio
for Vocational Education has declined significantly in the early 1980s until the mid1990s against the backdrop of the Bank encouraging developing countries to invest
more in basic education.
Bennell and Segerstrom (1998) have observed that ‘there has been a decisive
shift of funding in favour of primary and junior secondary education and away
from vocational education and training (VET). In 1984–1985, nearly 25% of new
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The ideological underpinnings of World Bank TVET policy
education sector lending was devoted to VET projects. By 1996, this share had fallen
to a mere 3% (Bennell and Segerstrom 1998:271). This was against the backdrop
of the World Bank’s view that vocational education should be left to individuals or
be provided in work places through private institutions. This reasoning is similar
to the idea that publicly funded vocational education will not contribute to poverty
reduction in developing countries.
The tension between ‘productivist’ and ‘developmentalist’ assumptions about
TVET is based on what the ultimate objective of TVET should be. According to
Anderson (2009, cited in McGrath 2012:3), productivism is premised on two key
assumptions:
1.
2.
Training leads to productivity, leads to economic growth (training for growth)
Skills lead to employability, lead to jobs (skills for work).
The developmentalist logic on the other hand argues for a greater role in poverty
reduction, human rights and human capabilities, all of which relate more to inclusion
rather than the market-led approaches of the World Bank (Powell 2014). By inclusion
I mean a more inclusive developmental approach, which focuses on reducing poverty
and unemployment and also has a far more participatory inclination.
Powell (2012; 2014) has characterised the relationship between poverty and VET
as being of enabling community and worker empowerment, protest and resistance of
the inhibiting structural shifts within the capitalist economy. The absence of such a
perspective results in a sanitised narrative of development that places all countries on
an equal playing field although they face different realities emerging from varying
historical experiences. What is critical is how economies can be re-orientated to be
more equitable in order to address problems of poverty and underdevelopment.
Neoliberalism has taken the mantle of capitalist development in the late 20th
century and into the 21st century and, through imperialism (cultural and economic),
has shaped the main policy orientation of many governments in the South and the
North. The contemporary shape of modern capitalism is seeing a significant shift
from industrial manufacturing-based economies to services economies, which are
often called ‘knowledge economies’ in which financial and other services have
gained ascendancy over the traditional productive sectors of the economy in the
twentieth century. Gorz remarks (2010:1):
We are living through a period in which several modes of production coexist. Modern
capitalism, centred on the valorisation of large quantities of material fixed capital, is
increasingly giving way to a postmodern capitalism centred on the valorization of socalled immaterial capital, which is also termed “human capital”, “knowledge capital” or
“intelligence capital”.
The contemporary manifestations of neo-liberalism can be summed up as the
promotion of the market mechanism to direct the fate of human beings by dictating its
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rules to society, not the other way around. Neoliberalism focuses on market solutions,
by criticising the efficiency and equity of government interventions (George 1999;
Klees 2012). Human capital theory predates neoliberalism and is understood by
its proponents such as Becker (1964; 1993) as human capital that corresponds to
any stock of knowledge or characteristics the worker has (either innate or acquired)
that contributes to his or her ‘productivity’. Becker’s conception associates ‘skills’
with the neo-classical ideas of ‘human capital theory’ (HCT), which seeks to extend
economic theory to explain the entirety of human behaviour.
Human capital theory therefore advances a linear concept of change in
which educational attainment equates to economic success, but this linearity is
decontextualised from the configurations of power and the purposeful actions of
capitalist producers. As Sears (2003:76) states:
It is not necessarily obvious, then, that neo-liberal governments should be pushing for state
intrusion into the job training realm at a time when a rapidly changing occupational structure
makes the identification of future needs virtually impossible. The need for “flexibility” in
conditions of rapid change would seem to constitute a strong argument for general rather
than vocational education.
The rapidly changing occupational structure of capitalist industries makes it virtually
impossible for the state to make accurate assessments of future skills requirements.
The manpower planning models of the 1970s, which suggested a linear approach
to labour market planning, have been criticised by a number of scholars (Windham
1975; Psacharopoulos 1991; Klees 1986) for lacking flexibility, being unable to
capture the range of variables that influence the labour market and the likelihood that
they will present a static picture of manpower requirements. As Windham (1975:189)
states, manpower planning has come under increasingly strong criticism for its
failure to meet the society’s supposed need for a development-oriented educational
programme. The main assumptions of manpower planning are:
1. The economic system is dependent upon the education system to provide manpower with the education and training necessary to promote economic growth;
2. Low substitutability between skills and education exists and therefore specific
education-occupation paths may be determined; and
3. Increases in the demand for forms of educated manpower may be predicted on
the basis of predictions of output changes-this is done via the further assumption
that the future employment-output ratios are themselves predictable.
For Psacharopoulos (1991:460), the extreme manpower planning would be valid
only in a static and dictatorial society where, say, 1 000 electrical engineers would be
produced in the year 1995 and ordered by decree to fill 1 000 electrical engineering
slots, and remain there until the year 2035 or to the end of their productive life.
However, the future is not so clear cut. Planners forget that economic progress and
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societal well-being come from unanticipated changes in the way we do things.
These critiques of manpower planning and education planning in general have been
influenced by economists’ version of what should be the tight alignment between
education and the economy. This is the backdrop against which World Bank education
policies have been developed since the 1970s, and these policies have strongly
influenced African governments’ planning for education and the labour market.
An important trend in the writings that support the human capital theory
perspectives is that they tend to be supported by think tanks financed by big
companies such as J.P. Morgan, which strengthens the popular appeal of these views
in the mainstream media.
Human capital theory reduces individual workers to a bundle of technical skills that are fed
into the economy. Therefore, while it successfully challenges the limited understanding of
“capital” in classical economics it perpetuates a “mechanistic” view of the individual worker
(Brown 2001:13).
The notion of human capital is insufficient to describe the variety of forces that
drive the development of human beings, neither is it sufficient in providing a holistic
critique of the myriad factors that contribute to unemployment, inequality and poverty.
Sears (2003) argues that ‘Technological change in capitalist society has not usually
been associated with a generalized increase in skill requirements’ (Sears 2003:59).
Livingstone (2012) has maintained that the biggest challenge to human capital theory
is the evident societal underemployment of credentialed knowledge, which flies in
the face of arguments that higher levels of education improve ‘productivity’.
Instead of identifying this as an anomaly inherent to capitalist accumulation,
human capital theory advocates tend to argue that graduate unemployment is
merely a fault of students and failure of institutions to provide students with ‘useful’
knowledge that can be used in the labour market. As a result, some university and
TVET programmes are then defined as ‘irrelevant’ for the modern high paced
technologically developed economy. According to Rose (2006:1019):
The rise of human capital allowed the World Bank to justify its own involvement in
education, it also provided a rationale for the World Bank to reassess the relative role of
states and markets in education. World Bank-supported research put forward efficiency and
equity arguments to justify setting a price for consumers.
The World Bank’s Education Strategy 2020 advances an agenda of individual
responsibility for skills training in which one’s productivity is based on individual
choices. As a result, failure to acquire employment opportunities is blamed on
the individual rather than seen as an outcome of policy choices. Critics such as
De Siqueira (2012:70) have argued: ‘Regarding individuals the Bank presents a
reductionist perspective of education and learning, as an individual must become
skilled to increase “his or her” individual productivity, as though production were
not a collective process, and aims solely at the adaptation of new technologies rather
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The ideological underpinnings of World Bank TVET policy
than at their creation’. In a similar vein, others such as Vally and Spreen (2012:177)
maintain that
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World Bank Education Strategy 2020 conveniently transfers the responsibility for
unemployment to individual deficiencies, implying that lack of employment is a reflection of
a person’s skills level and abilities instead of an intrinsic weakness of the economic structure
and how employment is distributed. In this sense it remains an ideological hoax that ends up
blaming the victims.
Taking into account changes in the structure of the world economy and its modalities
of reproduction, Soudien (2002) argues that ‘while the World Bank understands the
centrality of education in the information economy, it is not focusing its attention
on those elements of the subject which matter most. The Bank needs to recognize
how much governments have been weakened and how their welfare capacities have
diminished’ (Soudien 2002:447).
For Klees (2012:49), while the World Bank pretends everyone – countries,
bilaterals, multilaterals, civil society, and more – is in partnership with it, it is the
World Bank that takes the lead on education policy. With its periodic strategy reports
and a virtual juggernaut of research done internal to the World Bank or financed by
it, it decides on the global directions for education policy, backed by grant and loan
money that ensures countries follow those directions. One example is the WBES 2020
wherein the World Bank suggests that developing countries should leverage private
funding for TVET as the demand for TVET is growing. ‘Beyond basic education,
demand for tertiary education and for technical and vocational education and training
(TVET) is growing in every region served by the Bank. Given the higher cost of
these education services, cost-effectiveness and returns to investments are principal
concerns’ (World Bank 2011:36).
One approach is for governments to leverage the growth of private tertiary
and TVET institutions by implementing quality assurance and equality promotion
systems (World Bank 2011:36). I show below how World Bank policy has shifted
since the 1990s such that by the 2000s the World Bank’s position on TVET had
shifted from discouragement to support – though under certain conditions. The
report downplays public provision – arguing consistently for the conditions that
make private VET provision both more feasible and better.
The World Bank has changed its position from focusing on primary education
rather than secondary and higher education. ‘With expanding demand for higher
education in developing countries and the growth of a global information technology,
the Bank’s emphasis on only primary education has become untenable’ (Kamat
2012:33). By 2011 the release of the World Bank’s Education Strategy 2020, an
expanded all-inclusive definition of education was emphasised, in which all levels
of education are seen as necessary steps to achieving development goals. This has
been reformulated by the World Bank into a popular phrase of Learning for All,
which is promoted as an all-inclusive education policy approach accommodating all
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The ideological underpinnings of World Bank TVET policy
role players from faith-based organisations to private education providers. In reality
though what is embedded in this Learning for All logic is a further deregulation of
education and the consolidation of the neoliberal positions of the World Bank. As
Kamat (2012:45) suggests, ‘the World Bank’s view is that the capitalist economy is
an immutable and permanent reality and education policy must simply adapt to the
logic and requirements of this economy even if it means insecurity and vulnerability
for a vast majority’.
Overall, the view of many educational critics of the World Bank’s 2020
Education Strategy is that it is overly economistic in the way that it views education.
As Soudien (2012:96) states, ‘there is much in Learning for All that is puzzling.
The Bank’s signature discourse – a narrow definition of skills and knowledge –
remains prominent. The questions, “What are the strengths of our system? Where
are the weaknesses? Are children and youth acquiring the knowledge and skills that
they need?,” posed regularly throughout the document, are invariably answered in
an economistic way’. Taken as a whole, these policies of education and training
by the World Bank since the 1990s have signalled a shift to a focus on technical
vocational education and skills’ training for employment, signalling that the Bank
sees these areas as critical to ameliorating the development challenges in poorer
countries. What I have cited above are the contestations over the World Bank’s
conceptualisation of the problems of development and the role of education. Implicit
ideological assumptions of World Bank proposals are that improving skills training
alone could provide solutions to the structural problems of unemployment and
development through the provision of human capital out of national education and
training systems.
The shift in World Bank TVET policy can be traced from the early 1990s. In
May 1991 the Bank released a paper titled Vocational and Technical Education and
Training: A World Bank policy paper, which essentially argues that priority must be
on primary and secondary education with training playing a complementary role.
The paper states:
Training in the private sector-by private employers and in private training institutionscan be the most effective and efficient way to develop the skills of the work force. In the
best cases employers train workers as quickly as possible for existing jobs. Costs are low
compared with training before employment, and trained workers are placed automatically in
jobs that use their skills. Larger employers often have the technology, and their supervisors
have the expertise, to train in both traditional and newly emerging skills. Even the very
small unregulated enterprises of the rural and urban informal sectors can provide the training
needed for existing technologies and production practices (World Bank 1991:7).
In this earlier period, the World Bank saw very little role of public provisioning of
pre-employment training and therefore saw public training as complementing the
training done by the private sector, its priority was Primary and Secondary education.
As seen in the report:
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This paper proposes an approach to the design of public training policies that can help
policymakers create strategies that ensure that the skills needed by the economy are
developed and that equity objectives for the poor and socially disadvantaged are effectively
addressed. The key elements of this approach are strengthening primary and secondary
education, encouraging private sector training, improving effectiveness and efficiency in
public training, and using training as a complement to equity strategies (World Bank ibid.:8).
The position of the World Bank then shifted to more support for more TVET but
through private provisioning. Since that time, the experience of reform of VET in
both poor and rapidly growing countries has pointed to new directions in making
skills more relevant for economies in which private sector employment has grown
increasingly dominant. Debates concern both costs and relevance.
In March 2000 the World Bank in conjunction with the International Labour
Organisation (ILO) released a report titled Vocational Education and Training
Reforms: Matching skills to markets and jobs edited by Indermit, Fluitman and Dar
(2000). The report argues for a stronger matching of skills to markets and budgets.
Regardless of the mechanisms through which VET is supplied, it is critical that these
programmes target groups that will most benefit from them. This is because VET is more
effective when used for some purposes (for instance to meet clearly observed, current labor
market demands), than for others (such as keeping less gifted students out of higher education
or helping the unemployed find jobs) (Indermit et al. 2000:33).
The report reflected the World Bank’s thinking around key tensions that influence
VET in the countries surveyed for the study. The tensions relate to the role of TVET
in the context of high unemployment rates, lower levels of labour absorption,
redirecting of students from higher education to TVET and the threat of greater
public funding for TVET ‘crowding out’ private providers. This signals a departure
from the Bank’s original ideas in the early 1990s that general education should be
prioritised while skills training should be done mainly through employers training.
The emphasis in the report by Indermit et al. (ibid.) is that resourcing of TVET by the
state should be limited and that provision should be done more by private providers.
The position adopted by the World Bank through its WBES 2020 paper, which
it published in 2011 and wherein it changes its tune and states that ‘[t]he challenge
is to give these young people appropriate opportunities to consolidate their basic
knowledge and competencies, and then equip them with technical or vocational
skills that promote employment and entrepreneurship’ (World Bank 2011). In
essence, what the shift in the World Bank’s approach has entailed is the emphasis on
skills as being necessary for growth, which would be achieved through vocational
education. In other words, the World Bank sees the vocational education approach as
the solution to the unemployment challenge and that TVET per se can promote both
employability and entrepreneurship. This is different from the emphases in early
strategies (1990 and 2000) that emphasise a greater role for general education while
TVET and skills training should be more complementary to the schooling system.
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The WBES 2020 also emphasises a ‘systems approach’. It states:
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The system approach to education reform recognizes employers as key stakeholders
in education and regards nonformal skills training as part of a continuum of learning
opportunities for acquiring key knowledge and skills. Efforts are underway in the Bank, in
collaboration with development partners, to develop a framework and tools to measure the
skills and competencies of a country’s labor force. One aim of these efforts is to increase
the share of education projects that include labor-market objectives and thereby improve the
acquisition of workforce skills’ (World Bank 2011:44).
This systems approach is not clearly explained nor is it supported by evidence. Klees
(2012:59) argues that the World Bank’s system approach is a resuscitated form of
systems analysis that was popular in the 1960s and 1970s. Systems analysis took a
simplistic view of a linear and mechanical connection between inputs, processes and
outputs (with perhaps a feedback loop included). However, it was strongly critiqued
from its inception and is generally considered outmoded today.
These shifts in World Bank policy on TVET since the 1990s signal the depth
of ideologically based assumptions about the preferences of private provision of
skills training and TVET with a limited role by the state, which is mostly confined
to regulation. This emphasis is premised on the belief by World Bank policy makers
that too much state involvement can ‘crowd out’ private providers. The irony in
the shifts within World Bank policy on TVET is that the Bank first emphasised the
role of general education, then retracted slowly – as it saw demand for post school
education increasing in developing countries – to a more bureaucratic approach
centred on linking skills to budgets and markets, and now in the WBES 2020 it sees
TVET as central to promoting entrepreneurship and employment. I now examine
briefly the tension within WBES 2020 about whether the focus should be on skills
for jobs or jobs for skills.
SKILLS FOR JOBS OR JOBS FOR SKILLS? INTERNAL
CONTRADICTIONS IN THE WORLD BANK’S APPROACH
TO TVET AND EMPLOYMENT
One of the fundamental internal contradictions in the World Bank’s approach to
education is that it maintains that ‘skills mismatches’ can be explained by market
failure, yet it implies that the ‘skills mismatches’ will be solved by the market. The
WBES states that supplying skills is important but that there exists a ‘mismatch’
between skills and the economy (also see World Bank STEPS 2014 document).
At another level the World Bank argues that some skills are best learnt on the job
through ‘on-the-job training’. The notion of ‘demand’ for skills is problematic
because it relies on an idea of demand based narrowly on employer needs. However,
many employers are unable to explain exactly what demand they require and how it
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exactly fits into their requirements as those requirements themselves remain elusive
due to the dynamics of capitalist turnover times and the lack of job opportunities. A
further dilemma is around the paradox of growth without jobs, which is critical in a
context where many African countries have been growing their economies at high
levels, with some, such as Ghana, at rates of 4–5% per annum (King 2009), yet being
unable to create mass employment opportunities.
The ‘skills mismatches’ or ‘skills shortages’ debate arises in the context of
the above ideological discourses (see the section on human capital theory) and
approaches to the study of skills. It is these ideological perspectives (particularly the
neoliberal ones) that inform the debate about shortage, mismatch or surplus of skills.
Skills shortages or mismatch discourse has taken shape in South Africa over a long
period since the 1980s and even earlier, and some scholars sought to show that the
skills question is underpinned by a discourse of legitimation. For example, Chisholm
(1984) notes:
The skills shortage, irrespective of whether there is an actual shortage or not, plays a powerful
part in negotiating the discourse of legitimation. It appears to be used as a rationale for
bringing about changes which cannot be brought about directly since various class interests
are thereby threatened. These changes are nevertheless essential in securing the support of
certain categories of black workers and in legitimating continued exploitation of workers,
albeit under different conditions (Chisholm 1984:405).
The skills issue is framed by mainstream labour economists as being a problem
of ‘frictional’ misalignment between ‘supply’ and ‘demand’, when the problem is
actually more about a systemic misalignment, as Lehulere (2013) has argued. This
misalignment therefore must be discovered ex post, it cannot be taken as given or
axiomatic. The direction production must take is essentially a question of power.
Skill arises as part of this decision making process in which workers and government
do not form part. Skills invariably always have to be recalibrated and ‘retooled’ in
order to comply with the changes in the structure of production. The South African
labour market has not only been divided along racial lines but is also fragmented due
to the concentrated ownership patterns in the economy. Therefore discussing skills
‘mismatch’, ‘shortage’ or ‘scarcity’ has to account for the structure of the prevailing
labour market. What also confounds the issue is that a person goes through the
schooling system for twelve years, goes on to complete up to four years of tertiary
education only to be informed by authorities and researchers that they do not have
the skills. As Baker (2012:106) argues, ‘It would be a strange world if after most
people were socialized in formal school instruction lasting from 12 to 16-plus years
of their lives during which they learned these skills and value them in themselves
and others, that the world of work did not reflect this change.’
Unemployment data in South Africa are well known. According to Treat (2014),
official unemployment, narrowly defined, is around 25%, but unofficially it is closer
to 50% with estimates for young people being as high as 74%. This unemployment
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rate is often attributed to ‘skills shortages’ and exorbitant hiring costs, all of which
need to be ‘lowered’ in order for capitalists to hire more workers. The result of
this is that the education system gets blamed for apparent inadequacy in addressing
employment challenges. Critics of this explanation argue that:
Education might increase employability but is not an automatic guarantee for full
employment; that an instrumentalist view of the role of education is unhelpful especially as
such a view is always based on a raft of unjustified claims about the outcomes of education
and skills in capitalist societies; that education and training is not simply a handmaiden for
resolving the problems of low economic output; and that a wide range of exogenous factors
and social relations (inherent in all societies) circumscribe the potential value of education
and training (Vally and Motala 2014:31).
The skills shortages issue is therefore used in the dominant market-led discourse
as a singular explanation of the ‘cause’ of unemployment. It is also part of the dehumanising discourses that the capitalist system uses to assert control over society.
The dominance of the skills definition by employers has resulted in a narrowing of
the notion of skill and skills shortage to only apply to employer requirements that
prioritise profit maximisation and sustainability of big businesses (mainly). John
Treat has remarked recently on the narrowing of the concept of skills when it is
deployed narrowly only on enhancing employability:
Often discussions of skills and employment focus only on a very narrow range of skills,
namely, those that will encourage someone to hire jobseeksers. In South Africa as in many
other countries, there is an added emphasis on formal qualifications and formally recognized
skill. In some cases there is a good reason for this: for example if you choose to go to a doctor
or a dentist, you may wish to be sure that this person has the formal training they claim to
have. However, in many cases, formal qualifications may have little to do with people’s
skills, or their abilities to perform effectively in a particular role (Treat 2014:181).
Other authors such as Guy Standing, in his seminal book, The precariat: A dangerous
new class, argue that there are not any countries that have an accurate sense of skills
available in their populations.
There is always a shortage, insofar as one cannot see a limit to potential human competencies.
However, no country in the world has a measure of the stock of the skills of its population,
and standard indicators such as years of schooling should be regarded as woefully inadequate.
Is a garderner or a plumber unskilled because he/she has no secondary or tertiary schooling?
One might claim rather the reverse – that modern market society has a “skills excess” in that
millions of people have bundles of skills that they have no opportunity to exercise or refine
(Standing 2011:122).
The issue of skills in general is elusive as all attempts at defining skills shortages
show there is no common understanding on what a skills shortage is. This implies that
the problem rests not merely with definition but with the politics behind it. So, while
the World Bank claims to be siding with the poor, what in fact transpires through
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The ideological underpinnings of World Bank TVET policy
its policies is that it will only do this by adopting the market logic of structural
adjustment having profound effects as we have seen on the systems of education and
training especially in the African continent and other developing societies.
According to Hoogvelt (1997:184):
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Structural adjustment has tied the physical resources of Africa more firmly into servicing the
“old” segment of the global economy. At the same time it has oiled the financial machinery
by which wealth is being transported out of the region, thereby removing the very resources
which are needed by dynamic adjustment to the “new” global economy.
This movement of financial resources has occurred through the extension of Structural
Adjustment Loans (SALs) by both the International Monetary Fund (IMF) and the
World Bank. The SALs were provided in exchange for neoliberal reforms in trade,
macro-economic and fiscal policies. ‘The main features of what would characterize
adjustment lending for the next two decades for the IMF and World Bank: fiscal
adjustment, getting the prices right, trade liberalization, and, in general, a movement
towards free markets and away from state intervention’ (Easterly 2005:3).
The result of this has been that neoliberal policies, which undermine human
development and reduce social spending, have put pressure on African economies
to focus on deficit reduction rather than social investments. Within this context,
vocational education is being reduced to skills training and being fragmented, a
consequence of the neoliberal agenda of restructuring and fragmenting the labour
market and work reorganisation to promote ‘multi-skilling’, ‘lean’ production and
other similar objectives. These approaches are shaped largely by the logic of human
capital theory (as per above discussion), which has had a strong influence on policy
making in developing countries, particularly over the past few decades.
In the South African Economic update – Focus on inequality of opportunity
report, the World Bank defines the equality of opportunity principle as follows:
‘[I]deally, only one person’s effort, innate talent, choices in life, and to an extent
sheer luck, would be the influencing forces. This is at the core of the equality of
opportunity of opportunity principle’ (World Bank 2012:xii). According to the World
Bank, TVET has a mixed record due to institutional failures, distance from the private
sector, slow response to rapidly changing skills needs and capture by providers. The
World Bank argues that some skills – such as social skills – are best taught in the
workplace and the solution (according to the Bank) is learning through jobs.
The 1999 World Bank Education Sector Strategy has, among other goals, the
expansion of education systems in developing countries and investment in ‘human
capital’, which the policy sees as a way of bringing returns in the form of economic
growth. These are indeed laudable goals that could constitute a minimal intervention
in the face of prevailing development challenges. However, as Hickling-Hudson
(2002:566) maintains:
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[O]n the surface, these might all be satisfactory strategies by themselves, but when
considered in the context of the reality of the impoverished countries that turn to the World
Bank for education loans, they are problematic unless the economies of these countries
are significantly strengthened. The focus of the World Bank’s education strategy on goals
divorced from their ideological assumptions is like a magic wish-list, giving a distorted
understanding of global educational problems and possibilities.
It is against this backdrop of three decades of World Bank policymaking on TVET
and broadly education and training that I now focus on the South African TVET
policy trajectory and how the above-mentioned ideological influences have impacted
the South African TVET policies.
INFLUENCE OF HUMAN CAPITAL THEORY ON SOUTH
AFRICAN TVET POLICY
South African TVET, unlike TVET in other developing contexts, is funded through
the South African Treasury rather than the World Bank. South African TVET policy
has not vacillated in its commitment to the advancing TVET and has, for the past five
years (some would argue 10 and more), moved steadfastly towards the goal of an
expanded TVET sector. As noted in this article, World Bank TVET policy (despite its
vacillations) has promoted a free market approach, and been particularly committed
to private TVET and enterprise training. This is softenened in the South African
context where the commitment to a publicly funded and financially supported TVET
has grown.
There are heightened expectations in South Africa that TVET can contribute to
better employment prospects for unemployed youths and those seeking employment.
Increasingly, policy makers present TVET as a solution to the unemployment crisis as
vocational and technical courses are seen to provide greater prospects of employment
in the labour market. According to StatsSA (2014a), one in every three young people
aged 15–24 years (32.2%) were not in employment and not in education/training
(NEET). This proportion (the NEET rate) was higher among young women at 34.5%
than among young men (29.9%). The table below breaks down youth unemployment
by ‘race’, showing that African and Coloured youth are experiencing higher numbers
of unemployment.
TVET policy in South Africa and other countries is increasingly confined to
‘responsiveness’ to employer requirements and the promotion of ‘employability’.
According to Wedekind (2014:60), both the concepts of responsiveness and
employability can be linked to human capital theory (HCT, that is, the investment
in education and training that raises productivity, leads to economic growth, and
improves individual life chances), which dominates discussions about education and
development. Much of the debate about the role of TVET is framed by this approach.
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The philosophical basis of human capital theory draws from some economists’
emphasis on the returns to education and the prospects of improved salary earnings in
the labour market due to the levels of education attained. However, these economists
tend to reduce the value of education merely to its relevance in the economy rather
than as being a good in itself. Tikly (2013:12) remarks:
Rather than see education and skills as a good in themselves, exponents of human capital
theory prefer to see them as an objective factor in production. There is often a positivistic bias
in human capital inspired writing and research and the lack of an overt normative framework
for engaging with issues such as inequality and marginalisation.
Baatjies et al. (ibid.:81) have argued that the escalating interest in vocational
education is driven, among others, by the marginal status of vocational training
and the selective inclusion of students and workers in non-formal education and
training programmes historically. Over the past decade, the importance of vocational
education came into sharp focus as radical changes in the global economic system,
combined with scientific and technological innovation and transfer, demanded new
(largely formal) ways of preparing youth and adults for the labour market.
The Department of Higher Education and Training (DHET) launched a White
Paper on Post School Education and Training (PSET), which identifies the youth
unemployment problem as the main challenge to be addressed through building an
integrated Post-School Education and Training system. The White Paper proposes
increasing access to TVET colleges as part of addressing the problem of high
numbers of youth unemployment:
Government expects that TVET colleges will become the cornerstone of the country’s skills
development system. Headcount enrolments increased from 345 566 in 2010 to an estimated
550 000 in 2013; enrolments are expected to increase to one million by 2015 and 2.5 million
by 2030 (DHET 2013:13).
The DHET aims to exponentially increase the number of TVET enrolments by
2030 to around 4 million. The possibility of such targets being reached is debated
continuously by policy makers as access and interest in TVET is informed by a range
of factors, including culture and attitudes to education. Many young South Africans
are geared more to university education as it is perceived as a direct route to middle
class occupations and careers. As Baatjies et al. (ibid.:83–84) argue, resistance to
participation in vocational education comes at a time when there are not enough
jobs, including increasing numbers of students with vocational qualifications and
university degrees. Increasing joblessness and underemployment among graduates is
now being explained as a failure of curriculum models, including the lack of proper
work-based learning or work-integrated tools that fail to provide the proper skills
required by the labour market. Yet, the dominant discourse of policy argues for the
massification of vocational education as an emancipator instrument to address the
phenomenon of stubbornly high unemployment.
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At the core of the expansion of the TVET sector as envisaged by the White
Paper is the expansion of ‘supply’ in order to meet ‘demand’, which, as the World
Bank states, is based on jobs availability or that skills will lead to jobs as the World
Bank Jobs report suggests. The reality is that the capitalist labour market is anarchic
and results in a fragmentation of workers underpinned by neoliberalism. This
fragmentation leads to the increasing casualisation of workers, lower wages and
worsening youth unemployment. The labour market is a realm of unequal power
relations, therefore participation is important, but how the poor and working class
participate is equally important. Notions of responsiveness to employer needs arise
against this backdrop of discourse and empirical evidence about the rationale for
TVET expansion and growth in South Africa.
Scholars such as Amsden (2010) argue that purely emphasising supply provision
or expansion without dealing with demand side restructuring in order to create jobs
may prove futile for countries seeking to widen employment opportunities. Amsden
(2010) argues that in the presence of high unemployment at all levels, improving
the capabilities of job seekers will only lead to more unemployment and not to more
paid employment or self-employment. To believe that improving only the supply
side of the labour market is enough to reduce poverty without also improving the
demand side, and investing in jobs, is logically flawed and subject to the same error
as Say’s Law – that supply creates its own demand (Amsden 2010:57).
Critics of the underlying logic of the government’s TVET policy in the postapartheid era argue that, like other policies directed at addressing ‘skills shortages’,
TVET policies tend to prioritise problems of the prevailing labour market, which
are closely aligned to employability. Baatjies et al. (ibid.:88) have stated that in
effect the post-apartheid state has created a plethora of policies that seeks to address
the challenges posed by ‘skills shortages’ at the intermediate levels, ostensibly to
address the challenges of poverty, unemployment and inequality, but in reality to
respond to the demands of the prevailing labour market.
Vally and Motala (2014) have recently argued in a critically acclaimed book
titled Education, economy and society and in a challenge to Howard Becker’s notion
of human capital theory that:
Human capital theory suggested that education or training raises the productivity of
workers by imparting useful knowledge and skills, hence raising workers’ future income
by increasing their lifetime earnings. He argued that expenditure on training and education
is costly, and should be considered an investment since it is undertaken for the purpose of
increasing personal incomes. The consequence of this was to regard education as just such
an investment – as distinct from investments in consumption whose benefits were regarded
as immediate (Vally and Motala 2014:29).
The neoliberal approach to skills underpinned by human capital theory can be
summed up as an approach that privileges market-based ideologies, advances
a productivist approach to skill and education, conceptualises change in a linear
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The ideological underpinnings of World Bank TVET policy
fashion particularly in relation to the labour market and reduces the value of
education to a ‘return on investment’. As Wedekind (ibid.:57) has stated, faith in
investment in human capital as a means for addressing South Africa’s economic and
social challenges is widespread, not only in government but also in wider society.
Inevitably, South Africa’s TVET colleges are mentioned as part of the solution.
According to Baatjies et al. (ibid.:82), vocational and instrumental learning,
while oriented to narrow economic interests, also inculcates a particular philosophical
orientation significantly shaping and affecting how educators view their roles and
the purposes of vocational education; the beliefs they hold about their students; the
way in which select, use and design curricula; as well as how they facilitate learning.
One of the central concerns within this discourse is the role of vocational education
institutions as democratic sites of learning in educating citizens and encouraging a
commitment to social change and increasing levels of social equality.
CONCLUSION
The World Bank 2020 education vision is ambiguous in terms of what it seeks to
achieve. On one hand, it speaks of jobs requiring skills, while, on the other hand, it
speaks of skills as necessary for creating jobs. The critics of the World Bank 2020
education policy have argued that its ideological framework is neoliberal and that
it privileges market-based solutions to addressing education challenges. Since its
inception in 1944, the World Bank focused on rebuilding Europe after World War II,
and throughout the 1960s the Bank implemented structural adjustment policies that
placed many poor African countries in debt after taking loans from the bank. These
countries then had to acquiesce to World Bank prescribed policies of economic and
social reform. In recent times, the Bank has added to its responsibilities the task of
policy development and policy lending, particularly in the education sector.
What I have shown in this article is that the recent World Bank policy on TVET
has internal contradictions and its recommendations are not likely to assist poor
countries in dealing with socio-economic problems as they prioritise supply-side
restructuring rather than broader economic structural reforms. I then focused the
article around the World Bank’s approach to TVET since the 1990s and the nature of
the shifts in World Bank policy approaches to TVET.
The article has shown how the ideological influence of human capital theory
has also impacted the South African TVET policy. By this I am showing the need for
alternative theorisations that can rescue TVET policy from the narrow constraints of
human capital theory and neoliberalism. As Baatjies et al. (2014:89) have argued,
TVET is increasingly being centred as the sites of skills formation that can develop
the human capital for increased economic growth and to address the unemployment
crisis. There is an urgent need to map an alternative theory of skills formation that is
not hostage to human capital theory. The article has sought to contribute to the broad
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field of education, training and skills development and specificially to the literature
on TVET.
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ACKNOWLEDGEMENTS
I wish to acknowledge the contributions of Dr. Veerle Dieltiens and Prof. Stephanie
Allais to the conceptualisation of this article and the development of the argument.
Their encouragement helped me persevere through the writing of the paper. Dr.
Mondli Hlatshwayo and Dr. David Balwanz both gave ideas on how the paper can
be structured to illuminate the arguments more clearly. I am truly grateful to them
as well.
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