Jan Rutkowski
World Bank
Sarajevo
October 27-28
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1.
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3.
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The shift in labor demand: from less to more
skilled jobs
Industrial restructuring is an important source
of a skills mismatch in transition economies
Hard skills are not enough: soft skills play a
critical role
Skills mismatch may become an obstacle to
modernization and growth of transition
economies
Skills ≠ diplomas  need to develop better
measures of skills supply and demand
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
World Bank studies on labor market skills in
Europe and Central Asia
◦ Regional report
◦ Country studies
◦ Planned surveys of skills supply and demand

Main findings of country studies
◦ FYR Macedonia
◦ Croatia
◦ Poland

Policy response to the skills gap
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Demand for skills in ECA
Education and the supply of skills to the ECA
market
Resolving the skills shortage in the ECA
region: A policy framework
Managing for results at the pre-university
level of education
Managing for results in the tertiary education
sector
Advancing adult learning in ECA
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Ukraine labor demand study (2009)
Croatia: Reaching and sustaining higher rates
of economic growth (2009)
Are Skills Constraining Growth in Bosnia and
Herzegovina (2009)
Demand for skills in FYR Macedonia (2010)
Fuelling growth and competitiveness in
Poland through employment, skills and
innovation (2011)
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World-wide project on the supply of and
demand for skills
 Household based standardized survey of the
supply of skills
 Employer based standardized survey of the
demand for skills
 WB countries to be covered: Macedonia and
Serbia
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Changes in employment shares by occupation
Macedonia FYR, 2001-2006
Changes in employment shares by occupation
Poland, 1995 - 2006
6
8
4
6
4
2
0
pct points
percentage points
2
-2
0
-2
-4
-4
-6
-6
-8
Professionals and
managers
Technicians
Clerks
Macedonia
Service and sales
workers
Skilled agriculutural
workers
Skilled manual
Unskilled manual
-8
Professionals and
managers
Technicians
Clerks
Service and sales
workers
Skilled agriculutural
workers
Skilled manual
Unskilled manual
Poland
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Wage Growth by Occupation
(average wage growth = 1)
Bulgaria 1996 - 2006
1.6
1.5
Managers and officials
1.4
Professionals
1.3
Technicians
1.2
Clerks
1.1
Service and sales
Craftsmen
1
Machine operators &
assemblers
Elementary
occupations
0.9
0.8
0.7
1996
2006
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Difference between share in
job creation and in job destruction
Elementary
Machine operators
Craftsmen
Agriculture
Sales
Personal services
Net job
creation
Net job destruction
Clerks
Technicians
Professionals
Managers
-15
-10
-5
0
5
10
15
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
Between occupational groups
◦ Too many social scientists, too few engineers
◦ Too many clerks, too few nurses and electricians

Within occupational group (skills gap)
◦
◦
◦
◦
Inadequate technical (job specific) skills
Inadequate cognitive skills
Inadequate behavioral & social (soft) skills
Too much theoretical knowledge, too little practical
skills
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Only proxies for skills: education, occupation
But skills ≠diplomas, educated ≠ skilled
Labor market indicators
◦ Unemployment rate: excess supply
◦ Vacancy rate: unmet demand
◦ U/V ratio (by education, occupation)
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Employer surveys
Tracer surveys of graduates
◦ Poland: obligatory for tertiary education institutions
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Labor Shortage and Surplus by Education
2007
70
Tertiary
60
50
40
30
%
shortage
20
10
Secondary technical
0
-10
Basic vocational training
surplus
-20
Elementary
Secondary general
-30
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Labor Shortage and Surplus by Occupation
2007
200
Professionals
150
100
%
Personal service
Craft and trades
50
shortage
Technicians
Machine operators &
assemblers
0
Salespersons
Elementary
-50
Clerks
surplus
-100
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Job vacancy rate by occupation
Poland 2005-2008
2005
2006
2007
2008
4.5
4.0
3.5
percent
3.0
2.5
2.0
1.5
1.0
0.5
0.0
Managers
Professionals
Technicians
Clerks
Service and
sales workers
Agriculture
Craftsmen
Machine
operators &
assemblers
Elementary
occupations
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Most important employability skills
% of firms reporting
Responsibility & reliability
Literacy
Communication
Customer care
Motivation & commitment
Team working
Problem solving
Basic vocational/job-specific
Use of ICT
Numeracy
Planning & organizing
Advanced vocational/job-specific
Foreign language
Self-management & enterpren.
0
10
20
30
40
50
60
70
80
percent
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Skills that workers are lacking
% of firm reporting
Responsibility & reliability
Motivation & commitment
Communication
Customer care
Literacy
Team working
Basic vocational/job-specific
Problem solving
Use of ICT
Advanced vocational/job-specific
Planning & organizing
Numeracy
Foreign language
Self-management & enterpren.
0
5
10
15
20
25
30
35
40
percent
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Skills as an obstacle to firm activity
2009
40
35
30
percent
25
20
15
10
5
0
Yes
No
Yes
Investment in new
No
Exports
Yes
No
Website
technology/equipment
Major obstacle
Moderate obstacle
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Skills
Difference in the “importance”
index
(ranges from 1 to 5)
Foreign language
.54
Use of ICT
.52
Problem solving skills
.27
Technical/vocational skills (basic &
advanced)
.25
Planning and organization
.23
Self-management & entrepreneurship
.21
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
Educational system more responsive to the changing labor
market needs
◦ Broad and transferable skills to prepare workers for the world of growing
job and occupational mobility
◦ Interactions with employers
◦ Life long learning
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More emphasis on development of soft skills
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Good and accessible labor market information to guide career
choices
◦ Work attitudes and behavioral skills as important for employability as hard
technical skills
◦ Educational system focuses on equipping students with cognitive &
technical skills rather than soft skills
◦ Closing the skills gap will require reorientation of educational and training
policy
◦ As opposed to manpower planning

Better information on skills supply and demand
◦ Employer surveys, tracer surveys of graduates, survey of skills
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