SECTOR SKILLS COUNCILS.
WHAT? WHY? HOW?
CONTRIBUTING TO BETTER
VET RELEVANCE TO THE
LABOUR MARKET NEEDS
Petri Lempinen, Specialist in VET and Social Partnership
This paper is based on recent European Training Foundation (ETF) experience in the development of
Sector Skills Councils in Eastern European countries. Most of this work has taken place within the
context of the regional project on Continuing Vocational Training in Eastern Europe 2011-2013.
Development of the ideas in this paper has especially benefited from the experiences supported by the
ETF in Croatia, Moldova and Belarus, complemented by other information from global and European
experience. Siria Taurelli, J. Manuel Galvin Arribas, Michael Graham and Arjen Deij have provided
valuable comments during the finalisation of the document.
© European Training Foundation, 2013
Table of contents
Introduction ............................................................................................................................................... 5
Training for the labour market...............................................................................................................5
Why take a sector approach? ...............................................................................................................5
What is a sector skills council?................................................................................................................. 7
Definition of a Sector Skills Council ......................................................................................................7
What do Sector Skills Councils do? ......................................................................................................8
European and global experience ..........................................................................................................9
Initiatives in the partner countries ...................................................................................................... 11
How to organise sector skills councils .................................................................................................... 13
Typology of Councils ......................................................................................................................... 13
Advisory, decision-making or technical roles ................................................................................. 13
Limited or extended range of activities .......................................................................................... 14
Actors to be organised ....................................................................................................................... 15
Incentives ........................................................................................................................................... 16
Roadmap ................................................................................................................................................ 17
The Councils system ......................................................................................................................... 17
Composition of the councils ............................................................................................................... 19
Individual members and experts ........................................................................................................ 21
Legal basis and funding ..................................................................................................................... 21
Success factors and obstacles ............................................................................................................... 24
The work plan for the pilots................................................................................................................ 24
Importance of labour market information ........................................................................................... 26
Recommendations: THE ETF Position .................................................................................................. 27
Sources .................................................................................................................................................. 29
Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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INTRODUCTION
Training for the labour market
People need skills to find jobs and enterprises seek new members of staff able to meet their skills
requirements. A properly skilled work force is a crucial factor in the business environment as it has a
direct effect on the economy and the labour market (European Commission, 2012). This premise
underpins the need for dialogue between representatives of various economic sectors, the public
authorities and those institutions responsible for training, including vocational education and training
(VET). Such an approach demands a proactive attitude from all of the parties involved, coupled with
the will to cooperate (ETF, 2012b).
One key goal of any education and training system is to train employable graduates. This means
training people in the skills and competencies needed in the labour market, not just training people to
look for any random available job. Ensuring the labour market relevance of skills is a key challenge for
VET systems in most countries, in the industrialised, transition and developing economies alike (World
Bank, 2013; Taurelli et al., 2013). However, many individuals are unable to access quality education
and training.
The Torino Process 2012 confirmed that European Training Foundation (ETF) partner countries are
strengthening VET reforms that aim at greater efficiency, economic growth and competitiveness. The
justification for these reforms lies firmly in socio-economic developments, such as the increasing
numbers of young people looking for work opportunities in precarious labour markets, and the ensuing
VET reforms must be designed to fit specific socio-economic and cultural contexts in consideration of
national or regional specificities and the varying needs of a range of economic sectors.
This position paper provides arguments to back ETF in its support for the development of Sector Skills
Councils with partner countries. The aim is not to provide a single ‘one size fits all’ solution, but to
describe possible steps toward the establishment of Councils in any given partner country, developed
on the basis of practical work by ETF in Eastern Europe over the 2011 to 2013 period.
Why take a sector approach?
Many industrial and developing countries use sector approaches to promote skills development in the
knowledge that great benefits can be gained from internal organisation within individual sectors. The
fact is that labour markets are not homogeneous, and skills needs will vary from one economic sector
to another depending on the activities pursued by each sector and the nature of the associated
technologies. Each sector perspective will also depend on the markets open to them and the
availability of a skilled work force.
Some form of occupational framework would be useful in building an approach to skills training and
there are many such schemes available for consultation. In principle, such a classification should
follow the logic of the economy and labour market in question, with the term ‘sector’ used to refer to
one branch of industry or a cluster of professions for the purposes of this document.
The classic breakdown of the economy divides it into the three sectors of primary (production such as
agriculture), secondary (manufacturing and construction) and tertiary (services), but as it operates at a
very general level, it does not allow for any understanding of the skills needs in different economic
activities. More usefully, the United Nations approved a more detailed breakdown of 21 different
economic activities each with three sub-levels, while the Eurostat website
(http://ec.europa.eu/eurostat/ramon) offers a fuller International Standard Industrial Classification of All
Economic Activities that is currently mostly used for statistical purposes.
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Similarly, the European Commission has divided the labour market into 42 sectors, each with a social
dialogue committee representing social partners, employers and trade unions. The remit of these
councils goes beyond skills development, but the approach to the classification of industries may be
useful. For example: the manufacturing sector is broken down into the constituent sections of
chemical, food and drink, footwear, metal, paper, shipbuilding, steel, textile and clothing and
woodwork (http://ec.europa.eu/social/main.jsp?catId=480&langId=en). Similar classifications can also
be found in the EU Member States, The structures of employer organisations and trade unions are
often based on collective bargaining structures.
In South Africa, however, the economy has been divided into 23 sectors including: agriculture,
banking, construction, education, energy, financial management, health, local governments,
manufacturing, mining, trade and transport (www.seta-southafrica.com).
For VET to better meet the needs of enterprises and job seekers there must be an understanding of
the dynamics and key drivers of change. This knowledge can be established with the participation of
social partners – employers and trade unions – and other business organisations, chambers of
commerce, enterprises and bodies representing professionals. Employer involvement is a crucial
success factor and efforts should also be made to cover the interests of small and medium-sized
enterprises (SMEs). Their participation is further justified by their potential greater awareness of the
skill needs on the labour market.
Cooperation with labour market representatives can attempt to cover the whole economy at national or
regional level, but many successful examples come from initiatives focused on particular economic
sectors. The main advantage of a strong focus on one sector is that firm sector-specific knowledge
and expertise it built upon under such an approach (Wilson et al., 2013). Insight into the likely future
developments in employment and skill needs are also based on an understanding of the state of play
and the key drivers of change. Analysis of the current labour market and labour force structures is
therefore important, as is the ability to predict future trends, in order to determine what changes will be
needed. This approach applies to both the need for new competencies and qualifications, increases or
decreases in the number of jobs available in various occupations and the training needs of the current
workforce (ECORYS, 2010a). The practical problems and challenges must be translated into a list of
priorities to be tackled as part of a systematic approach (Cedefop, 2009).
This paper promotes the case for ETF to support partner countries in the development of Sector Skills
Councils, but the possible shortcomings of any such approach must also be discussed. The first
general problem of focusing on a single sector is that only a partial view of the labour market needs for
training will be produced, whereas a broader perspective is needed for many purposes, such as the
development of the education system (Wilson et al., 2013). Secondly, top down initiatives do not
usually motivate private sector actors into participation in the formal sectors or other forms of
cooperation. Success demands trust among stakeholders; an element that cannot be created
overnight.
In many countries, the public authorities play a leading role in lifelong learning policies (ETF, 2012).
Because of the absence of regular dialogue between the private sector and the educational and
training sector, information and knowledge failures occur on both sides. The private sector often lacks
the incentives or opportunities to contribute to VET reforms, it shows little interest in identifying precise
skill and competency needs, and little capacity to provide practical training to complement the
theoretical education provided by the public schools and institutions.
The new reform processes imply the involvement of labour market actors in the development and
provision of VET, changing their position from that of bystander to that of collaborator. Dialogue is
needed at system or national level and within sectors, providing for debate of the training content and
methods needed to meet the needs of each specific industry. Any VET reform should take the needs
Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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of different industries and branches into consideration. Various mechanisms for public-private
partnership can be used to support the sharing of responsibilities and the pooling of financial and
human resources (European Commission, 2012). This demands willingness and the motivation to
work together from the representatives of government, the labour market and the education and
training system.
This sector approach can also focus on the funding of training where enterprises – and workers in
some cases – contribute to training provision through levies. Funds such as these are usually
managed by social partners representing employers and trade unions, and they can be effective tools
where employers are voluntary engaged. In these cases, the employer organisations have participated
in establishing the funds and they also have a strong role in the management process (Cedefop, 2008;
ECORYS, 2010b; ETF, 2012b).
Other examples are available of sector level bodies that coordinate skills development efforts among
stakeholders, where employers, trade unions or training providers from the sector are often involved in
the definition of qualifications or occupational standards. In some situations, the validation of learning
outcomes and the certification of learners can be a responsibility attributed to labour market
representatives, for example: in Turkey, the sector committees validate the formulation of learning
outcomes given in both the standards and curricula. Assessment of the learning outcomes of
individual workers in Turkey, however, forms part of the role of the VocTest Centres.
In some situations, a large enterprise will create its own training policy to support its business plans.
There are examples in Russia of giant enterprises that have drawn up their own occupational
standards, created training centres and accomplished coherent human resource policies. However,
where a number of enterprises are in competition, there may be conflicting initiatives that can hinder
the development of common standards for a sector. Also, initiatives established by individual
enterprises usually concentrate exclusively on big enterprises and the needs of SMEs are not
covered. These elements clearly demonstrate the need for a wider approach within a sector.
WHAT IS A SECTOR SKILLS COUNCIL?
Definition of a Sector Skills Council
Sector Skills Councils promote skills development in a given economic sector. They are permanent
working structures to identify or analyse skill needs or to otherwise contribute to education and training
that will prepare the work force for the specific economic sector. Different sector structures are widely
used across the world and the Councils may be established through initiatives by the social partners
or government. The Councils are usually recognised in legislation, which gives legitimacy to their work
and affirms their mandate. Legal recognition grants them a right to express their opinion to the public
authorities.
The Sector Skills Councils are platforms of cooperation in which at least two types of stakeholder are
involved. These stakeholders may include public authorities, social partners (the representative
organisations of employers and employees) and education, vocational training and research institutes.
This criterion used in the EU is problematic when considering some of the employer-led Sector Skills
Councils in the UK or the employer or trade union led VocTest Centres in Turkey.
The European experience has clearly shown that Councils work in a structured and continuous way.
They are permanent bodies that are not set up on a temporary basis as a reaction to a specific need.
Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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The Councils may operate at national or regional level, depending on the country context. Finally, their
existence reflects the shared will to reform VET to better meet labour market needs.
Common features of Sector Skills Councils in the EU Member States include:
■
representation of one or more specific sector of the economy;
■
provision of a platform for at least two types of stakeholder;
■
working in a structured and continuous way;
■
provision of analysis on labour market trends in the sector; and
■
a focus on anticipating employment (quantitative) and skills (qualitative) needs within the sector,
using this insight to inform the development of sectoral policies (ECORYS, 2010a).
Many countries also have transversal councils that focus either on the labour market as a whole or on
groups of sectors within this. A transversal council may have a coordinating role among sectors or it
may simply have a transversal role focussed on particular issues such as Information and
Communication Technology (ICT) or managerial skills that are needed in all branches of industry and
also in the public sector. As an umbrella organisation, a transversal council can also discuss ways to
analyse the labour market, as the methodologies they employ do not usually depend on sector
characteristics. Transversal councils can also set priorities for a range of sectors (ECORYS, 2010a).
What do Sector Skills Councils do?
The sector approach is useful when drawing up a strategy or a development scenario for a sector; a
process that will often extend beyond skills and training provision. Sector Skills Councils can focus on
likely developments in employment and skills needs within any sector with the aim of assisting
development of the sector either as part of a coherent strategy or as a one-off initiative. While the
employment outlook tends to produce quantitative evaluations, the view on skills or competencies is
more qualitative in focus. Both viewpoints are needed to improve education and training provision.
According to the ILO (2012), the Sector Skill Councils provide bridges between the labour market and
the education and training systems. Their remit is to promote skills development for a specific
economic sector. A general vision for the work of any sector or transversal council can be defined as
being: ‘To improve the match between demand and supply on the labour market’. In other words: the
councils deliver evidence- and analysis-based messages from the labour market to the VET system.
This vision must be sharpened, as any form of mismatch can have an impact that may be either
quantitative (on jobs) or qualitative (on skills and competences). The match between demand and
supply can be achieved through better qualifications and training programmes or through more
practice-oriented training provision. Where councils really represent the employers of a given sector
they can be instrumental in areas such as the promotion of work-based learning; a practical solution
that can improve the skills and competencies of graduates as learning outcomes. The Councils can
also provide policy advice in response to consultations from the authorities in charge of VET or
employment, with Council members formulating their opinions on the basis of in-depth information
from the sector.
In the EU, the Councils usually focus either on initial or continuing VET, undertaking a variety of tasks
for each category. ECORYS (2010a) found that national councils for Initial Vocational Education and
Training (IVET) focus on matching the qualitative gap between the supply from education and training
and the demand on the labour market. Their tasks include the identification of emerging and changing
skills needs in the sectoral labour market followed by the development of national level occupational
Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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standards, qualifications and curriculum outlines. The second task is completed at national level to
ensure a comparable level for diplomas from all over the country. In comparison, the continuing
vocational education and training (CVT) councils usually tackle skill gaps within the existing work
force, either by providing training courses for them or by funding the training provided for workers.
Each Council may cover one or several of the above tasks depending on the individual context and
the resources available.
The ETF partner countries usually have limited resources to reform VET or qualifications, and this
means it is beneficial for stakeholders in the countries to have a clear focus. For example: the
modernisation of occupational standards should start with those occupations that are most important
in the sector. The Croatian, Turkish and Moldovan councils all started from the narrow role of
developing occupational standards. In India and South Africa, the roles of such Councils have
extended to include the identification of training needs and funding and support services relating to the
quality and content of provision, and these entities are now instrumental in developing the skills of
unemployed and unskilled citizens.
The International experience shows that tasks of the Sector Skills Councils can cover items such as:
1.
labour market analysis affecting quantitative or qualitative skills needs;
2.
forecasting skills needs;
3.
matching training provision to labour market needs;
4.
preparation of occupational or qualification standards;
5.
policy advice on lifelong learning or VET;
6.
fostering cooperation between educational providers and employers;
7.
provision of training for the work force; and
8.
funding of training.
European and global experience
Sector approaches are popular in the EU but the structures and functions vary considerably. In 2009,
there were 44 different sets of Skills Councils in the 22 EU Member States present before the
accession of Croatia.
The structures and objectives of the Councils vary from one country to another, and they may cover
initial (IVET) or continuing vocational education and training (CVT) or both. These may be simple
advisory forums, or they may have some real powers at national or regional level, even where the
number of regional Councils is small. All 22 countries had some form of council with a transversal
responsibility (ECORYS, 2010a), but despite their evident popularity, there is no universal European
model for organising Skills Councils.
The popularity of sector approaches in the EU Member States strongly suggests that the gap between
labour market needs and supply from the VET system is considered to be a problem. The European
Commission promotes European levelattempts to develop partnerships and a flexible learning supply
for more efficient education and training systems. (EC 2012)
At present, though, from a total 44 sets of Councils: 19 entities across 13 countries are focused on just
one specific sector of the labour market (as is the case in the Czech Republic and Romania). In all of
the 22 countries, there are just 25 councils with transversal responsibilities, but not all are established
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on the same basis. The Councils in the UK are employer-led organisations, while in Finland, they
make formal representations to the Ministry of Education and other education authorities linked to the
work sector.
In the EU Member States, the Sector Councils aim to boost the skills of their workforce, reduce skills
gaps and shortages, improve productivity and improve the quality of the learning supply. Councils can
also support the development of career awareness materials for young people to inform them about
the opportunities offered in each sector. In France, two almost parallel systems of sector and
transversal Councils have been developed, one for initial and one for continuing training. While
training authorities cooperate closely with the social partners in the initial training system, the area of
continuing training is more of an exclusive domain for social partners.
The fact that five EU Member States have no sector or transversal councils demonstrates that there
are also other effective ways of organising dialogue between the labour market and the VET system.
For example, Germany, famous for its VET system and economic development, has bipartite sector
agreements between employers and trade unions and it also uses the mechanism of temporary
working groups led by the Federal Institute for VET (BiBB).
Two other pertinent examples from Europe come from Latvia and Lithuania. Both of these countries
formed part of the former Soviet Union until 1991 - a historical background that provides a point of
reference for partner countries in Eastern Europe. These two Baltic States have not established formal
Sector Skills Councils, preferring a form of legal process to involve stakeholders in consultation. Both
countries have also benefited from the European Social Fund, which has been used to finance
projects to forecast labour market needs and reform education and training systems. European
funding has also been used in other Member States, but this is not available to the partner countries.
The use of Sector Skills Councils is not limited to Europe. They are widely used in both industrial and
developing countries ranging from Australia to Brazil and Canada to India. Sector approaches perform
a range of activities to ensure that training in their sector meets the needs of employers, playing a role
in skills anticipation and matching and, in some cases, taking responsibility for defining content and
funding training.
India has National Skill Development Policy to foster workforce training and private sector participation
through funding of training and supporting services including curriculum, quality assurance and
accreditation systems amongst other elements. An important part of the work is to create a robust and
comprehensive labour market intelligence system. This initiative includes establishment of the Sector
Skill Councils to complement the existing VET system for the industry sector. The role of this Sector
Skill Council will chiefly be to create an information base through research, to improve the delivery of
training through partnership with VET institutions and to build quality assurance and accreditation
systems. In practice, cooperation can include other elements such as training and the certification of
trainers in industry and VET institutions, or the training and certification of existing staff.
At the next level down from the federal level, most Indian state governments have also set up
‘regional’ State Skill Development Missions to coordinate the training agenda. These structures differ
between the states according to the local environment and the political vision for skill development in
each state. According to a study published in 2005, the vast majority of Indian college graduates are
unemployable due to their lack of skills and, as a matter of fact, very few young people enter the
workforce with any type of formal or informal vocational training completed
(www.nsdcindia.org/pdf/approach-paper-ssc.pdf).
A good skills strategy will extend beyond the human capital development of vocational training in ways
that can be linked to growth policies and industrial, rural or urban development plans. In the Republic
of South Africa, the National Skills Development Strategy will be put in practice through the 21 Sector
Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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Education and Training Authorities (SETA) created under an initiative from the Ministry of Labour in
2005. South Africa has millions of unemployed people who lack the basic skills to seek a job
(www.seta-southafrica.com/).
Initiatives in the partner countries
The ETF has promoted sector approaches in the partner countries since the 1990s. Recently, this
work has been linked with national qualifications frameworks in various countries including Croatia and
Turkey. Establishment of the Sector Skills Councils is on the agenda in many ETF partner countries in
the Western Balkans, Eastern Europe and Central Asia. There are also examples of sector
approaches in Morocco. The ETF is currently supporting or planning to support this type of work in
Azerbaijan, Belarus, Kyrgyzstan, Moldova and Serbia. In Eastern Europe, this support mostly occurs
within the framework of the Continuing Training in Eastern Europe regional project.
Croatia, which was an ETF partner country until the summer of 2013, has an established system of 13
Sector Skills Councils. The need for a sector approach became increasingly clear as the education
system was not reacting to changes the in labour market. The Croatians studied different systems and
initially tried to copy and paste examples from the British model that were not really suited to their
needs and conditions. This trial and error process led to a decision to create their own model based on
local needs and capacities.
The interim Sector Councils were established in 2006, and these entities developed working
procedures, completed an initial sector analysis on occupations and qualifications and developed the
first occupational standards. The lesson learned from the Croatian interim phase was that a more
systematic approach was needed, and just such an approach was formulated in the principle of
partnership used the VET strategy of 2008. The aim was to involve all partners in planning, financing
and managing the VET system in order to permanently harmonise education with labour market
needs. The VET law of 2009 then provided the legal framework for the Sector Councils.
In Turkey, social partners are involved in the governance of the education and training system through
participation in the national Vocational Education Board, the Provincial Employment and Education
Boards and Sectoral Committees of the Vocational Qualification Authority, the latter of which are
charged with the important task of developing occupational standards. There is also a sector-based
system for the certification and validation of learning outcomes (ETF, 2010).
The first sector committees in Moldova were created to cover the agriculture and food industry and
construction sectors as a result of a 2008 project, and further committees for ICT and transport were
established in 2012. Six years on, these Councils are still finding their way and they still lack the legal
status and resources they need for their work, despite having been mentioned in a government ruling
on the methodology for occupational standards development in 2011.
The Moldovan VET Strategy 2020, launched by the Ministry of Education, aims to create a total of 12
Sector Councils. The next three councils planned for 2016 will cover light industry, energy and trade;
areas consistent with the economic priorities. The Strategy states that the Ministry of Education
foresees permanent funding for these committees and, in a parallel move, the Ministry of Labour has
prepared a draft Law on Professions which will provide the legal basis for the sector committees,
granting them a role in occupational standards, review of classifications and some other VET-related
functions. The draft law also envisages a technical secretariat to support the sector committees,
however there is no consensus within the government about how this is to be funded. Until the law is
approved, however, the committees have no legal status, although they are recognised by both the
Government and the Commission on National Bargaining.
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The Moldovan example shows how the lack of funding and legal status has hindered development of
the Sector Councils. It also shows that working with sector bodies does not necessarily provide fast
returns as it takes a long time to build sufficient trust among partners for them to work smoothly
together. Dedicated people, adequate funding and expertise in the field are crucial preconditions for
any successful work.
The current challenge lies in the move away from government-driven bodies to cooperation initiatives
based on the needs of the economic actors within the sector. This naturally demands recognition of
the autonomous status of employer organisations, trade unions and other stakeholders representing
the labour market, and it also requires open communication between labour market actors and
education and training players.
Ukraine provides another bottom up example where employers from the metallurgy sector established
a Sector Skills Council in 2012 to be followed by the chemical industry in August 2013. Members of
these councils represent employers, trade unions and relevant education institutions, but, to date, they
are not properly connected with the public authorities in charge of VET.
An ETF initiative in 2012 collected information from Eastern European countries that allowed them to
map existing sector initiatives. Most of the countries have permanent or project-based sector
committees or working groups, at least on paper. They have various stakeholders as members and
their tasks are linked to occupational standards. The table shows the results of this mapping clearly
demonstrating the growing understandings that work at the economic sector level is desirable in order
to develop VET content.
Table 1. Sectoral Skill Councils (SSCs):
Overview on on-going experiences and policy development in ETF PCs
ETF Regions & PCs
Western
Balkans
SERBIA
SECTORS INVOLVED
FORMATION- LEGAL STATUS-POLICY FOCUS
(4)ITC; Agriculture; Food Industry;
EU -IPA project- (coming to end). Focus: Review of
Tourism.
occupations, jobs, skills, qualification profiles development.
15 sectoral committees which
MoE & National Council VET Development (NCVD) cover big range of economic
Tripartite commissions (chaired by employers). Focus:
activities.
educational standards /curricula.
(7)Construction; Tourism; Energy;
SSCs exist within project on occupational standards
AZERBAIJAN Processing industries; Agriculture
development (Ministry of Labour). Other line Ministries,
Transport; Trade and Retail.
Employers, Enterprises, Trade Unions, Training providers.
Information Technologies;State-driven initiative. Decree approved on sectoral
BELORUSSIA
Managerial activities.
qualification councils.
(14)Geo-Engineering;
Mechanics/Metallurgy; Arts;
Coordination: National Center for Educational Quality
Business Admin; Tourism; Health;
Enhancement (NCEQE). Focus Occupational Standards and
GEORGIA
Transport; Energy & Commerce;
analysis sectoral labour market and qualifications.
Agriculture; Mass Media;
Involvement of Business associations, Employers,
Construction; Environment-IT;
Professional Organisations
Architecture; Natural Science.
(4)Construction; Agriculture & Food Led by Minister of Labour (tripartite approach): Sectoral
REP. of
Processing; Transport;
Commissions for Social Dialogue. Focus: occupational
MOLDOVA
Communications.
standards, skill need analysis in the labour market.
Multi-sectoral
&
regional
driven
Professional
Communities. Government decree. Led by MoE
RUSSIAN
initiatives: Network of regional
& Agency for Strategic Initiatives. Main focus: occupational
FED.
professional agencies.
standards.
Employers-driven initiative. On the basis of Ukrainian
(2)Metallurgy & Mining; Chemical.
Federation of Metallurgy producers. Trade Unions &
UKRAINE
providers on board. SSCs: Envisaged to be recognised by
professional training law.
(7)Light industry; Construction;
National VET Agency regulation under MoL & National Skills
Agriculture, Tourism; Service (food Council. State-driven exploring private actors’ involvement.
KYRGYSZTAN
service); Energetic and Mining.
Focus: occupational standards, certification & matching
graduate employment, practice dissemination (etc.)
European Neighbourhood
East
ARMENIA
Central
Asia
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HOW TO ORGANISE SECTOR SKILLS COUNCILS
Typology of Councils
Sector Skills Councils can be divided according to their nature, role or range of tasks and they can
support modernisation of the national VET system.
Sector Councils may be professional bodies with their own resources including staff. In an
organisation such as this, the members of the Sector Council can be full-time employees with
expertise relating to either the sector, qualifications or VET. In The Netherlands, sectoral knowledge
centres for IVET have some 1,500 members of staff.
An organisation such as this can have the legal status of a public institution, non-governmental
organisation (NGO) or even a limited company. A Sector Council as a professional body demands
permanent funding that will allow it to engage in various activities such as sector studies or drafting
and designing standards and qualifications. In principle, the work of the Council can be funded from
the state budget or by enterprises. From the point of view of enterprises, direct funding can be justified
where there is clearly a positive cost-benefit relationship.
Alternatively, the Sector Skills Council can be working bodies to represent different interest groups
from the sector. In these cases, the members of the Council are normally employed in the
organisations they represent, meet regularly to take their decisions and they may also be asked to
provide an opinion based on the results from a sector study or a skills need analysis. They may also
take a position on proposed occupational standards or qualifications.
Indeed, members of this type of working bodies are employed in other organisations such as an
enterprise, business association or training provider, and membership of the Council is only one of
their obligations. They are not expected to be ‘technical experts’ in VET or sector studies, they are
simply asked to provide advice, analysis or opinions based on the needs in the sector (Buić, 2013). A
Sector Council, as a working body, does not necessarily need to be an independent legal entity if it
does not have its own staff.
Both professional and working bodies may be quite autonomous, or they may be closely connected
with public institutions. Working bodies in particular will need technical assistance and expertise in
order to be functional. Provision of this support can be arranged through a secretariat that will not
necessarily have any expertise from the given sector as this will be provided by the members of the
Council. Where this sort of arrangement exists, the secretariat should have expertise in predicting
trends, labour market analysis or qualifications and standards – depending on the role of the Council.
In either case, the impact of the Councils will depends on recognition of their work being achieved in
the legislation.
Advisory, decision-making or technical roles
Further, the role of a Sector Skills Council can be advisory, decision-making or technical, and the
nature of each individual Council will depend on how it is positioned vis-à-vis the institutions in charge
of VET and qualifications in each country. Again, the details of this are linked to the legal basis and the
definition of relations between public institutions and the Sector Councils. In all cases, the Council
tasks may include various forms of analysis or studies that will contribute to the decision-making
process.
All Councils have a clear advisory role, as Sector Skills Councils are expected to give their opinions on
planned VET policies, technical reforms and standards or qualifications. The Council will analyse a
range of information in order to formulate an opinion, thereby aiming to ensure that VET provision
Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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responds to the needs and trends of each sector. National legislation or current policy may demand
that the public authorities consult these entities, and a positive opinion from these bodies may be a
prerequisite for a final decision in some cases. In Croatia, for example, the agreement of the Sector
Council must be sought before the Ministry can approve a qualification standard, and, in Finland,
sector committees give their opinion on the proposed national core curriculum for VET qualifications
prepared by multi-stakeholder working groups. The National Board of Education, the central agency
for education development here, can only make final decisions after hearing the Sector Councils.
The Romanian Sector Councils, which are professional bodies with decision-making role. They
approve the occupational standards proposed by training providers. Several countries, such as France
and Italy, also have sector organisations which finance continuing training for workers. Those funds
have bi-partite (employers and trade unions) management boards that decide on the funding of
initiatives proposed by enterprises or social partners. The funds are usually provided by contributions
by enterprises in the form of levies based primarily on collective agreements, and, to a lesser extent,
on legislation.
A technical role can also be taken when a Sector Council actually prepares and delivers results in the
form of occupational standards or reports from studies it has undertaken or commissioned. The
technical role also includes funding or the provision of workforce training.
The professional bodies usually have a decision-making or technical role. The working bodies are
largely limited to an advisory role. This means that role of the Councils depend a lot on their financial
means and human resources.
In some cases, roles may overlap where a Sector Council has been delegated some decisions, but
these are mostly restricted to the provision of advice. It is also possible to have a system where the
role of the Council is topic related, as is the case in Croatia, where the legislation stipulates that the
Ministry of Education will approve education standards only after the Sector Council has taken a
positive opinion. Experiences show that this double role is not easy to establish. Members of the
Councils do not necessarily have the relevant level of expertise or the institutional ‘neutrality’ to play
the role of expert (Buić, 2013). To address these issues, many countries within the EU share the tasks
and responsibilities between Sector Skills Councils members who provide advice and subject experts
who provide the Sector Skills Councils members with analysis and supporting documents – such as
draft standards and sector analyses – presenting proposals upon which the Councils can formulate
their advice.
Limited or extended range of activities
The Sector Skills Councils can also be divided on the basis of their given tasks. The ‘limited’ functions
are almost exclusively focused on ensuring that there is a qualitative match between the demand for
skills and the supply of vocational education. In practice, they may play a role in the development of
occupational standards, the curriculum or VET qualifications, meaning that their work is related to the
national qualifications framework.
The Sectoral Skill Councils deploying ‘extended’ functions have the same core roles and tasks, but, in
addition, the council is required to express opinions or give advice to decision makers on development
of the VET system and policies and, furthermore, on the type and level of training programmes
needed at a national or regional level. They can also express proposals on enrolment numbers.
Another important task they commonly perform is the fostering of cooperation between industry and
VET providers. This can include various forms of education and business cooperation including workbased learning, internships and apprenticeships. The Sector Council can also organise internships for
VET teachers that allow them to update their knowledge of modern industries. Sector Councils can
also operate to promote the sector and employment opportunities within the sector, as well as
providing materials for career guidance and counselling.
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All these issues are summarised and supported by international examples in table 2.
Table 2.Typology of Sectoral Skill Councils (SSCs)
Classification
Type
of coverage
Scope/Nature
Focus on 1
economic sector
Focus on more
than 1 sector
(Transversal )
Regional
approaches
Institutional
mandate
Professional
bodies
Working
bodies
Profile of
initiator
State-Led/Driven
Employer-led
Role in the
policy
making
process
Decision making
Policy
functions
Limited functions
Advisory role
Extended
functions
LLL policy
coverage
I-VET
CVT
Both (I-VET+CVT)
Key characteristics/features & remarks
Sometimes, a National VET Council can be operating by
covering all sectors at National or Regional level.
Some SSCs can be operating under umbrella organisations
(e.g. tripartite institutions/bodies; Minister
departments/Directions; Agencies for VET Quality; National
Qualification bodies/authorities, etc.).
Own resources/staff/expertise (full-time employees); legal
status & permanent public and/or private funded (levy/payroll
systems etc.).
Represent different sectoral interest groups. Members are
employed in represented organisations.
Policy dialogue/initiator is mainly led/ funded by Government
or state organisation, either or by employer organisations (or
by both).
The role of the firsts is to become the final decision makers
whereas the seconds are limited to deliver advice/non-binding
recommendations in skill policies to final decision making
actors.
Ensuring qualitative match between skills demand and VET
supply.
In addition, members extend their advice/analysis to other
policy areas/stakeholders (e.g. VET planning, quantitative skill
gaps; skill programmes; education & business partnerships
etc.).
SSCs can cover I-VET, CVT policies and/or both. They can be
sector focus or transversal oriented whilst operating at
national either or regional levels.
Country
examples (*)
CZ-RO-FIN-DENCAN-UK
FR-SPA-BEL-DEN
-UKBEL/UK/DEN/
FRA/NL/RO
UK-NL-CAN
CRO
BIE-KYRG-SING
UK- INDRO
CRO
SVK/FRA
AUST/BANG/
NETH
FRA/POL/SVK
SPA/SWE/BEL
FIN/EST//ROM/
Source: Buić, N. & Galvin Arribas, J. M
(*) Some country examples given are selected due to they might cover more than one category according to their
scope/nature. They can be consolidated and/or on-going SSCs experiences’ (in particular, in ETF PCs). Some of them can
correspond to sectoral either or transversal councils covering I-VET, CVT or both.
Actors to be organised
The precondition for cooperation is that both sides of industry – employers and workers – must be
organised to establish and advance their collective interests. Employers, enterprises and
entrepreneurs are represented by employer organisations or business associations. Workers come
together in trade unions which may also be referred to as labour unions in the literature on the subject
in English. Professionals of any given occupation will often be members of an association to support
their professional development or promote their interests. Organisations including both employers and
workers may be based on cross-industry or sector affiliation at national, regional or local level.
Skills development is very seldom the first or only priority of labour market actors. Instead, in the case
of employers anyway, they view skills and education as just one element of the business environment.
For trade unions, education and vocational training are ways to enhance employability and full
citizenship as two elements that empower people.
Employer organisations have a specific focus on wages, social issues and health and safety linked to
the responsibilities of their enterprise as an employer. They enter into social dialogue with trade
unions and usually with the government. Enterprises also have other interests that are linked to
promotion of the business environment. In some countries, these are the responsibility of an employer
organisation, but there are often also different business associations representing the interests of
specific sectors. The third major group of organisations are the Chambers of Commerce, Industry or
Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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Trades and Crafts. In some countries, membership of the Chambers is compulsory and they perform
certain public duties such as the registration of enterprises. In others, the Chambers play a strong role
in the certification of trainees as they complete their learning (ETF, 2012b).
Iindividual employers are often unaware of private sector involvement in the VET system at the
national level. For example, in the Arab Mediterranean countries, close cooperation between
employers and training centres is mostly dependent on individuals, that is, on personal and
professional relationships rather than institutional frameworks. Local employers thus have little say in
the type of training courses provided, especially in initial vocational education. At the same time, it is
obvious that the skills of graduates are crucial in increasing their chances of employment (World Bank,
2013).
Incentives
Some important questions must be answered if we are to provide partners with the motivation to work
together, in particular:
 Why should governments and social partners work jointly for the development of vocational
training?
 Why should governments share their decision-making powers with non-governmental
organisations?
 Why should employers and trade unions enter a sphere which is normally part of public
administration?
The success of any cooperative structure operates on the basis of trust, where there is firm belief that
stakeholders can perform certain tasks and deliver expected results.
Obviously, the underlying principle is that in creating a win-win situation, stakeholders will be
encouraged to work together. Where the current education and training system is unable to deliver the
competencies needed in work, some employers prefer to hire young people who have not yet gone
through VET system; as was observed by the World Bank (2013) in Egypt. At the same time, many
enterprises complain that the lack of skills among their employees is holding them back. Where this
paradoxical situation exists, it is logical that the engagement of employers in improving the training
system could bring them direct benefits, but real success on this front also depends on the willingness
of the government and education systems to take their messages seriously.
Labour markets need the technical skills developed through VET. The potential of VET provision
remains underused when it is not attractive to learners or relevant to enterprises. According to the
World Bank, young people in the Arab countries are avoiding VET as it is perceived as a low-quality
option visibly associated with academic failure. These perceptions can be changed only if VET
provision is reformed and made more relevant. Until then, employers will be responsible for training
their newly recruited work force in the technical skills required. Employers could also play a key role in
improving the attractiveness of VET by recruiting VET graduates instead of graduates from higher
education (World Bank, 2013).
The Indian approach offers political reasoning for the development of VET and sector initiatives, on
the basis that training for employment in the skills needed by modern industries and services can
create stability in society, minimising the risk of untrained and unemployable youth turning to crime or
becoming mobilised by extreme political movements (www.nsdcindia.org/pdf/approach-paper-ssc.pdf).
This perspective allows the public authorities to justify the participation of employers and other
stakeholders in the governance of VET systems. The next step in such an approach is to motivate the
stakeholders by showing that their voices will be heard and taken into account. ETF partner countries
often have a centralised administrative tradition that prevents stakeholders from open participation in
policy dialogue, meaning that social partners may feel excluded or marginalised from critical decision-
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making processes. Transparency in policy making or in governance is an important precondition for
partnership (Parkes et al., 2009).
In this situation, the successful establishment of Sector Skills Councils demands a change of
paradigm in the administration. Enterprises and entrepreneurs are motivated only if they can see clear
advantages for themselves – especially where they are asked to fund the work of the Sector Skills
Councils. Once they have joined, however, membership of the Sector Council can be used to raise
awareness of the possibilities for private sector involvement in VET amongst affiliated members.
Companies within the economic sectors may be in competition with each other when recruiting staff.
This is a particular issue in countries where population is not currently growing. By joining forces,
enterprises in the sector can work together to promote the training of workers to meet their needs.
Work to develop occupational standards can be used to address the needs of employers, but there
are also countries where Skills Councils are de facto training providers and can operate as the
vehicles for joint action between enterprises.
The Councils can also promote employment opportunities in the sector by providing materials for
career guidance and counselling, and even for marketing of the sector. They can work directly with
schools or they can help enterprises to work with individual training institutions to improve the supply.
ROADMAP
The Councils system
Sector Councils are usually present in more than just one economic sector (ECORYS, 2010b), but this
is not necessarily the case in every country. One of the key issues lies in deciding which sectors will
be covered by Councils and how these sectors will be formulated. For example, Azerbaijan has
recognised 16 economic sectors, with cooperation initiated in seven sectors so far.
ECORYS (2010a) concluded that Sector Councils should be established when there is a clear and
recognised need to do so. The number of such Councils should take into account the diversity of
business sectors, the acute needs of the real economy and the possibilities of providing expert and
technical support. Sector Councils should not automatically be established for all economic sectors.
The number of Councils also depends on the tasks they are expected to perform and the role they are
to play. In situations where there is a larger number of Councils, the work tends to be more technical
and practical, while situations with a smaller number of Councils may actually have a greater impact at
the political level.
Innovations are common and new occupations are often created at the margins of various sectors.
The Councils should be prepared to cooperate in order to cover issues that fall between different
sectors, and, in practice, the Councils could have common working groups to deal with overarching or
transversal issues. This would also reduce the total number of individual Councils needed.
The sustainability and efficiency of the Sector Skills Councils are dependent upon the institutional
arrangements and overall coordination of the tasks (Buić, 2013). Even where Sector Councils are
independent organisations, they can form part of a larger system of Councils, as is the case in the
Netherlands, which has ten Councils for IVET.
Most ETF partner countries will be unable to set up Sector Skills Councils as specialised organisations
with their own staff and experts, although this may be possible for individual sectors that have wellresourced enterprises. In most of the countries, however, the Councils would probably be working
bodies. In this situation, a VET or employment agency could be placed in charge of coordination and
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cooperation, and the Sector Councils can report to this entity. The coordination role could also be
taken on by an appropriate organisation providing technical secretarial services or expertise to the
councils. Communication between the Councils and governmental institutions could also take place
through a coordinating point. The choice of this entity will depend on the individual policy context and
the range of institutions available to coordinate the work of the Councils.
A good example of a system that performs well occurs in the United Kingdom, where the Sector Skills
Councils are well-resourced specialised organisations. In 2013, there were 18 Sector Skills Councils
and 5 sector skills bodies to work with some 550 000 employers. All of the bodies are independent
and employer-led. Their umbrella organisation is the Federation for Industry Skills & Standards which
developed out of the Alliance for Sector Skills Councils (http://fisss.org/sector-skills-council/, last
accessed 17 November 2013, Cedefop 2009). These Councils work in close cooperation with the UK
Commission for Employment and Skills (UKCES) which is a publicly-funded, industry-led organisation
providing strategic leadership on skills and employment issues (http://www.ukces.org.uk/about-us last
accessed 9 September 2013).
In The Netherlands, the sector organisations are grouped under one umbrella organisation, the
Association of Centres of Expertise on Vocational Education, Training and the Labour Market (COLO),
governed by its member employers, trade unions and centres of expertise (Cedefop, 2009).
Without expertise and technical assistance, the Councils will not be able to deliver reliable and
sophisticated outcomes. Expertise is needed in data gathering and analysis as well as in formulating
messages in a coherent way. Councils that work with occupational standards or qualifications need
experts to formulate the documents. If the Sector Council is a specialised organisation, the experts
needed are most probably also the Council members or employees, as is the case in the UK or in The
Netherlands. In the case of a working body, experts can be external consultants or they can be
employed by an institution (public or private) that provides support to more than one Council. For
example, in Finland, the expertise and secretariat are provided by the National Board of Education, a
government agency in charge of qualifications and curricula for VET and CVT as well as for general
education.
Besides expertise, the Councils need a secretariat to provide administrative and technical support.
The Councils need sufficient funding and other resources to allow them to fulfil their duties. Members
of the Councils and experts that support Councils probably also need training to be able to perform
this task.
The possibilities of Councils performing well are dependent upon their funding, as this determines the
type of Council that can be established in practice (working body or specialised organisation, limited or
extended activities). In principle, the work of the Councils can be funded from the public budget
(Ministry of Education or Ministry Labour) or by participating institutions and stakeholders. Where
participating organisations or employers in general are asked to contribute to funding, they will request
good reasons and some practical return on their investment. This means that Councils funded by
employers should have some real powers. Many EU Member States fund Sector Councils from the
European Social Fund, or they use other project funding. In ETF partner countries this option will
require funding by external donors.
Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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Source: Buić, 2013
Composition of the councils
The definition of the Sector Skills Councils given at the beginning of this document stated that at least
two different stakeholders must come together in the Council. These stakeholders may represent
social partners, chambers, enterprises, business organisations, training providers or public authorities
in charge of VET or employment. It is important that the participating institutions are relevant to the
given sector and that, for example, social partners or business associations have real links to
companies. The range of possible stakeholders to be involved means that the remit of the Sector
Skills Councils often goes beyond that of traditional social dialogue, as participation is not limited only
to employers, trade unions and government representatives.
Attempts should be made to strike a balance between the various stakeholders in order to ensure that
the Council can act as a neutral representative of a sector. A wider range of constituent stakeholders
promotes discussion and argumentation within the sector. The composition also defines to what extent
the Council will be able to communicate the needs of the real economy.
The Councils can be led either by the State (public authorities) or employers but it is usually social
partners or employers and business representatives who are at the heart of successful cooperation.
State-led systems most commonly exist in countries where the public authorities are the main
guardians of the quality of education and training. Other countries have industry-driven systems where
the skill requirements and competencies are identified and designed by employers.
The crucial element is for the Council to have legitimacy in the eyes of the employers. Extensive
coverage of various employers is essential if the Sector Skills Council is to represent the true training
and skill needs of the industry. Participation can take place through employer or business
organisations, chambers or individual enterprises. In many countries, entrepreneurs are critical of
these organisations as they consider they may in reality have closer links with the public
administration than with the member enterprises.
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Large enterprises are more commonly affiliated into employer organisations, and these groups
normally have more strategic views on human resource development, and they are often able to
formulate and express their needs. In some sectors, public employers are more dominant than their
private peers. Therefore also public employers should take part in the work of the Sector Skills
Councils.
Ensuring the engagement of SMEs can be particularly challenging for several reasons. While these
concerns are less likely to have formal training or human resource development strategies, they also
have less time available and participation in non-direct activities may hinder business performance. In
many ETF partner countries, moreover, SMEs are often informal concerns not affiliated to any
Chamber. The voice and viewpoints of SMEs are important as they may have different skills needs to
large enterprises. The staffs in small companies are more often expected to multitask as the division of
work processes and tasks is not as strict as in large companies.
Individuals are also important beneficiaries of VET and their voices need to be heard. Their views can
be channelled through trade unions representing workers or, in some countries, workers represented
by professional associations that promote interests of a given occupation. The trade unions tend to
focus on working conditions and salaries through social dialogue.
The balance among social partners, employers and trade unions will be largely dependent on the
tradition of social dialogue in the country. Countries with active tri- or bipartite social dialogue often
also recognise trade unions as relevant stakeholders in VET, recognising that the remit of education
and training goes beyond the issues of competitiveness and the supply of a work force for enterprises.
A link with training providers can be useful when the scope of a Council extends from the labour
market into VET. Representatives of the VET providers or schools that prepare staff for the sector may
be appropriate members or permanent experts for the Council, making communication between the
labour market and VET providers easier. Training institutions and enterprises may have parallel
interests to propose on issues such as occupational standards. An established form of cooperation
within a structure such as a Sector Skills Council can help to keep the delineations clear and to avoid
confusion.
Cooperation between enterprises and VET schools and institutions is an important tool in enhancing
the relevance of learning outcomes. In many cases, local level cooperation is based on the interest of
individuals. A Sector Council can support more structured dialogue and even facilitate practical
cooperation capable of covering large areas of an economic sector.
In some countries, Councils are dominated by officials from the state administration and it is difficult to
draw any general rule on the optimal balance between different stakeholders, as each country will be
different. It is justified, however, to state that labour market representatives should have greater
representation than public authorities, as the main task of the Councils is to communicate the needs of
the enterprises.
The number of individual members of a Council varies from country to country and even from one
sector to another. In Ukraine, the council for metallurgy has 15 members, while the entity for the
chemical industry has 19, representing employers, trade unions and relevant education institutions. In
Moldova, each Council has a different number of members, ranging from 9 in the construction council
to 15 in transport. The Georgian Councils have between 12 and 15 members. The legal requirement in
Finland is for a maximum of 16 members with personal deputy members, while in Croatia the Councils
have up to 20 members.
Differences between the countries reflect different structures for stakeholder organisation. Finland
recognises three trade union confederations with their affiliated sector unions, and the teachers union
has their own representation. Employers and entrepreneurs are represented by four organisations,
Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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while the State and the church are also relevant employers in some sectors. VET colleges and
Universities for applied sciences (Fachhochschule) are also represented in the Finnish system.
Composition of a Sector Skills Council:
Labour market
Public sector
Employers
Employer Organisations
Business Associations
Chambers of Commerce etc.
Individual Enterprises
Public Authorities
e.g. Ministry or Central Agency
VET/Education Authorities
Employment/Labour Authorities
Relevant Sector Ministry
Education and Training
VET Schools or Colleges
Training Centres
Workforce
Trade Union(s)
Professional Association(s)
Individual members and experts
It is important to recognise the role of the different stakeholders and individuals involved, and to define
whether they are expected to be experts in VET with a capacity to participate in technicalities or
whether they are allowed to present the specific interests of their institution.
The expertise profile of an individual member will depend on the task and role of the Council. Where a
Council deals with technical issues, the balance of individual members will be different to where a
Council expresses the opinions of the industries. In either case, members should have practical
experience in the sector to ensure that they understand the dynamics of businesses as there is
otherwise a danger that the work will remain a mere academic or bureaucratic exercise.
Where the Council is a working body, members from the labour market should have a wide
understanding of the needs and perspective of the sector and its occupations. Secondly, they must be
able to analyse trends from the sector or interpret the results of various forecasting or foresight
exercises. Expertise in formal training systems and qualifications can be contributed by members
representing the educational institutions that prepare the sector workforce.
Where it is a specialised organisation, members must have technical competencies in their field of
activities. In all cases, members must have functioning networks with enterprises or educational
institutions from the sector in order to ensure that they represent wider interests that those of an
individual organisation or enterprise. Similarly, the social partners involved must have real links to the
private sector.
Councils that represent a broader range of stakeholders tend to have greater political weight. Where a
council has high-level industrialists amongst its members, it usually has greater credibility in
disseminating messages or raising funds. However, the availability and commitment capacity of highlevel members can be a problem, and a council with high-level politicians or civil servants is unlikely to
engage in any practical work unless it is well resourced. In most cases, Council members will have
other obligations and duties that have higher priority in terms of time, although a well-functioning
council can always benefit from the connections and experience of its busy members.
Legal basis and funding
Many initiatives to include employer and union representatives in VET governance have failed
because of the ad hoc nature of committees and the lack of operational responsibilities among
participating social partners (World Bank, 2013). Those in charge must show commitment and
leadership in order to motivate employers, in particular, to participate. Legal recognition of the bodies
Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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will provide a firm expression of their importance and motivate stakeholders to participate. The
principle of freedom of association guarantees the right of social partners or enterprises to establish
bodies for cooperation, but the public authorities are not obliged to consult these entities unless they
are recognised under the legislation.
The Councils are dependent on State authorities and they need a clear legal basis, especially in
centralised systems. In many countries, Sector Skills Councils are mentioned either in the labour
market or VET legislation, but they are seldom regulated by specific laws. More precise regulations
could be provided under a government decree or other secondary legislation.
Where a Council has decision-making powers that apply to the public provision of VET, these should
be prescribed in the legislation. For example, where occupational standards are officially approved
documents, a legal basis must be established for the role of the Sector Councils in the process. Their
role in giving advice must be formalised and recognised in legislation and other regulations.
Clarification must be given of the interaction between the Sector Council and public institutions in
charge of VET and the reporting protocols for Council advice and messages. Legislation can give
councils the legitimacy to express their views in various ways, and can give them a legal right to
submit an opinion on issues such as occupational standards or any policy initiative from the ministries.
Nomination procedures for the Councils will depend on their task, role and political weight. The
Councils may be nominated by a governmental institution or they may be self-appointed. In Croatia,
for example, the members are nominated by a relevant sector ministry.
Whether nominated or self-appointed, the legal base lists those organisations with the right to
nominate or propose members and outlines the process for setting up a Council. Where the Council is
appointed by a relevant ministry or government, its work can be more closely linked with the public
authorities. A strong government role is understandable in centralised political systems, but this may
cause problems in the motivation of non-governmental actors. Councils that are specialised
organisations are probably more autonomous from public authorities than working bodies with an
advisory role.
Moldova has prepared a draft law on professions which aims to provide a legal basis for the national
qualifications framework, occupational standards and Sector Skills Councils. The draft law aims to
establish a systematic relationship between the labour market and vocational training. According to
the draft law, the Moldovan Sector Councils will be recognised as advisory bodies to support policy
making through the provision of sector analysis and the identification of occupational profiles and the
content for qualifications. The law will also stipulate the funding and membership of councils and a
technical secretariat is foreseen to support their work. The draft law links Sector Councils to social
dialogue.
The Finnish Sector Councils operate under the education agency, the National Board of Education.
Their legal basis lies in a government decree defining the whole system of Councils including 26
Sector Councils, a steering committee and the possibility of creating temporary expert groups. The
decree outlines procedures for the nomination, assembly and tasks of both steering and sector
committees as well as rules for calling a meeting, decision making and fees and payments for
members.
A Council may be a legal person or may be formalised under a relevant institution, such as the VET or
employment agency. This is the case for the Finnish councils which lack the status of a legal person.
They can be defined as permanent working groups with a legal base and mandate. Working bodies
can have the legal status of an NGO, enterprise or semi-public organisation. As a legal person they
can make commitments and employe their own staff. Working bodies initiated by the private sector
may also have the status of a legal person.
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In a centralised VET system, the Councils depend on State authorities even where social partners
outnumber other members in the Councils or where they have taken the initiative to establish the
entity. Ultimately, the impact made by the Councils depends on how far their messages are taken into
consideration in the decision-making process; an element that can be supported by appropriate
legislation.
Funding the councils and their work is one of the most important factors in determining their
usefulness and success, as all of the possible activities described in the present document would
require funding. Employer surveys, sector studies, statistical analyses, the drafting of standards or
strategies all demand the input of an expert workforce, and these efforts must be funded from either
public or private sources. The problem with public funding is that State interests may outweigh the
interests of labour market actors. Conversely, employers and enterprises do not necessarily have the
motivation to contribute financially unless they can see a clear benefit and return on their investment.
Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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Example of basic regulation for Sector Skills Councils
Legal status
Legal Entity
Private/Public
Mandate
Function and Role
Time Frame
Coordination
Relationship between Sector Skills Councils and Public Authorities
Relationship and coordination between different Sector Skills Councils
Composition and membership
Stakeholders involved
Organisations to nominate or propose individual members
Rights and obligations of the members
Formal nomination of the council
Selection of the chair person
Organisation of the practical work
Preparation and calling meetings
Managing meetings (quorum) and voting
Secretariat and experts
Use of working groups
Funding
Sources of funding and rules for their use
Other
SUCCESS FACTORS AND OBSTACLES
The work plan for the pilots
The establishment of Sector Skills Councils has been increasingly popular across the globe, but it is
often driven by governments looking for a quick fix to acute problems in VET. Public authorities want
to engage employers in skills development, but sustainable sector approaches really need deeper
roots. Unless they are given sufficient time and resources to become established and perform their
tasks, they simply will not generate the hoped-for benefits (Wilson et al., 2013).
Decision makers in the partner countries should bear in mind that cooperative structures such as
Sector Councils deliver good results if their work is well supported. Non-professional bodies in
particular need technical and administrative support as well as expertise, as the members will not be
able to allocate much time to the work of the Sector Council (Buić, 2013).
Wilson et al. (2013) have identified a number of common factors in successful sector approaches. The
first precondition is that stakeholders, especially employers including SMEs, make the commitment to
work together and become practically engaged in activities. Ownership of the work of any Sector
Council should lie with the stakeholder representing the sector and not with the public authorities, and
the councils must be provided with financial and human resources in terms of knowledge and
experience.
Participants at the ETF regional conference on Sector Skills Councils in Chisinau on 18 and 19
September 2013 were unanimous in their view that stakeholders joining the Council should share an
understanding of the tasks and benefits of the entity.
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It is advisable to start such action through pilot sectors that meet the demands for commitment,
engagement and resources outlined above. It is important to show that this type of work can be
successful, and supported pilot schemes must be given every chance to succeed in their initial tasks.
There should be no gaps between the goals assigned to the body and the real level of cooperation or
partnership available in the perception of the participants.
Experience from the pilots can be used to develop a concept that can be transferred to other sectors,
but it is important to stress that Sector Skills Councils should be only established where there is a
definite need in the labour market. It is hard to motivate labour market stakeholders into playing an
active role in situations where the main motivation for establishing the Councils is simply to meet the
needs of the public administration.
Roadmap for establishment of the Sector Skills Council
Identification of the need for a Sector Skills Council
Skills mismatch in labour market
Support to VET reform
Motivation of the stakeholders to work together
Public authorities’ commitment to share their powers and to take results of the work into account
Social partners’ and enterprises’ commitment to contribute
Selection of the pilot sectors / occupations
Based on skill gaps analysis
Practical arrangements for the pilots
Selection of participating stakeholders and organisations
(Project) funding and human resources for secretariat
Preparation of the work plan with individual activities
Practical engagement of the pilot sectors
Networking with enterprises, training institutions and public authorities relevant to the sector
Development of the general concept
Definition of the role, function and tasks of the Councils
Identification of relevant stakeholders and organisations to participate
Drafting of the regulations that will be needed
Legal framework
Political and administrative recognition of Sector Councils
Organisation of the Permanent Councils
Nomination of the first Councils
Organisation of the secretariat and experts
Preparation of the work plan for Permanent Councils
The effectiveness of Sector Skills Councils depends on good practices in VET or labour governance.
The Councils contribute their expertise and advice only where they are linked into the decision-making
process. In many cases, these Councils address employment authorities by proposing occupational
standards. In some cases, they have a role in the planning and funding of VET, including the
qualifications framework. Where the governance system recognises the existence and role of Skills
Councils, there is a chance that their work will be able to influence policies. Procedures should be in
place to guide labour or VET agencies in consulting the Skills Councils at crucial points in the
Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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decision-making process. Such an approach will motivate Council members toward responsible
contributions and participation.
Councils must communicate with the sector that they represent, the authorities in charge of education
and training, and the institutions that provide the training demanded by the sector. Links with
industries and trade unions at company level are needed to ensure that Council members are aware
of the various trends and needs in the labour market. Links with VET institutions and agencies will
ensure that they are aware of the existing provision in education and training. A well-functioning
Council is formed by a network of actors and is more than just a sum of its formal members. Technical
support to the councils should also include resources and tools for good communication, and Councils
must be prepared to communicate with each other.
In majority of the partner countries, the public authorities have centralised responsibility for the general
or national objectives on education and VET policies. VET can be under the jurisdiction of several
ministries at the same time, each covering one element such as education, labour, economic
development, industry or any other aspect of a given economic sector. This means that the role of
non-governmental stakeholders is often limited.
In principle, many partner countries attempt to modernise VET governance and they introduce new
forms of management, leadership and coordination based on partnership and networking. The aim is
to strengthen the links between VET and society, the economy and the world at large (ETF, 2012).
These attempts are successful only if they are based on true partnership where the public authorities
trust that the stakeholders are able to deliver what is expected.
Consequently, there is only a limited potential for the copy and pasting of foreign models onto national
systems. Sector Skills Council tend to focus on similar issues in different countries, but the role and
nature of each entity differs dependent on the individual country context. In a country with centralised
VET governance or a regulated business environment, the role for employers and non-governmental
actors is often quite limited.
Also, economic structures have an effect on the modes of cooperation between businesses and
education. The economies of many ETF partner countries are characterised either by high levels of
informal work and enterprises, or by large oligopolistic or monopolistic enterprises. In some countries,
giants live side by side with the informal economy. Stakeholder motivation to participate depends on
their perception of the benefits, and enterprises in particular want to see a direct return on their
investment.
Importance of labour market information
Any serious sector approach is based on knowledge of the existing situation in the labour market
(Cedefop, 2009). This can be based on relevant data from existing sources or the collection of new
primary data. The selection of the methodology depends on the information needed and sources
available, but, in practical work, the councils should use the mixture of methodologies best fitted to the
circumstances, including considerations such as the availability of relevant data, and financial and
human resources (Wilson et al., 2013).
In order to start their work, the Sector Skills Councils need up-to-date information on elements such as
the current state of occupational structures and employment in a sector. For instance, where there is
no information available on the age structure of the work force, it will be difficult to estimate the need
for training of staff for different occupations and to cover the type of job openings created due to
retirement. The number of skilled workers can fall in some occupations while it increases in others. All
of these quantitative estimates must be built upon information on current employment.
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Labour market information is also needed when (qualitative) changes in skill needs are forecast. New
technologies, working methods or even environmental standards have an impact on existing and
emerging occupations. Even where the occupation continues to exist, the content, in terms of the type
of work and skills needed, can change as the job may be performed in a new way.
Occupational structures also change. For example, many Eastern European countries have a tradition
of narrowly described occupations despite the fact that the job profiles in the modern labour market
are much wider. Information is needed on the existing structures in order to define which are the most
important occupations for coverage by VET provision and which should have renewed occupational
standards.
The Sector Skills Council can design and perform surveys or studies from their own resources. They
can also outsource data collection and analysis, using the findings to define the opinions to be
delivered. International comparisons show differences in the extent to which Sector Councils are able
to carry out their own research. Activities naturally depend on the availability of funding and other
resources.
Studies and analysis are meaningful tools where the results are communicated and taken into
consideration by the authorities in the preparation of policies or practical measures that directly
contribute to the provision of a skilled work force for the sector.
Information on labour market needs and changes can be taken into consideration when: 1) allocating
resources and study places to different programmes (qualifications), and; 2) defining or redefining VET
content and methods in qualifications, curricula or occupational standards. The information gained by
the Sector Skills Council can also be used to inform young people of the career possibilities with a
sector, and the provision of realistic information is a tool that can make both the sector and VET
provision more attractive to new workers.
RECOMMENDATIONS: THE ETF POSITION
This document has described the possibilities that Sector Skills Councils offer to the VET system and
labour market. Their work can improve the relevance of VET where they are able to articulate labour
market needs and where their advice is taken seriously. The Sector Skills Councils answer to the need
for a shift toward VET provision more closely linked to labour market needs.
Sector Skills Councils are envisioned to move beyond ad hoc structures for consulting sector
representatives. The Councils offer a practical framework for systematic cooperation between
education and the labour market. It is important to remember that countries have different socioeconomic structures and political cultures that shape the environment in which the councils operate.
Their success depends on the commitment and engagement of relevant stakeholders and demands
openness from the authorities in charge of VET. There is, however, a danger that Sector Councils or
other advisory bodies may be reduced to mere bureaucratic exercises unable to encourage
stakeholder participation.
Social partnership has been identified as a tool to enhance the relevance of VET by many countries,
but this does not mean that Sector Skills Councils should be limited exclusively to social dialogue. In
some countries, these entities are bi- or tripartite, but in others a strong link with the VET system is
viewed as beneficial. Many ETF partner countries have centralised VET systems where the State has
a dominant role. While this sometimes causes inefficiency or mismatch with labour market needs, it
reflects the current reality. In such a context, the establishment of a Sector Skills Councils would mark
Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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a move toward more open governance, but the Councils would still be dependent on the State
authorities. Political will is a crucial element for success.
Development of more relevant content and training methods should be based on the needs identified
in enterprises and other workplaces. This work can be approached sporadically, building on individual
initiatives, or systematically, through the creation of Sector Skills Councils. The more systematic
approach would demand coordination among Councils from different sectors and the provision of
support to ensure that Councils can fulfil their tasks.
ETF should support establishment of Sector Skills Councils in a partner country only where there is
broad support and commitment both from public and non-governmental stakeholders. The Sector
Councils will function well only if they are seen as legitimate in the eyes of employers and social
partners. It is advisable to initiate action through pilots in sectors that have already identified
quantitative or qualitative skill gaps hindering business and employment opportunities. The pilot
sectors should be relevant for the state economy.
The experiences from the pilot schemes will allow social partners and public authorities to judge
whether there is a need for permanent Sector Skills Councils. The pilots can be used to develop the
concept of the Council including definition of the scope of their work, practical working methods, the
composition of the stakeholders and membership, and organisational and financial issues. This
concept will also serve as a basis for the legal regulation of the Permanent Councils.
The Councils are expected to articulate the training-related needs of businesses and the labour
market. This requirement demands that the Council be connected with the industry it is representing,
with education and training providers, and the authorities who ultimately make the decisions. The
Council may also have a role in increasing the commitment of employers to training and the creation
of a learning culture within their sector. The important element here is to identify direct benefits of
engagement to employers, both individually and collectively.
Sector Skills Councils can deal with a wide range of activities and the ETF should not be overly
orthodox in excluding certain types of stakeholders or possible activities when planning measures to
be implemented. On the contrary, the ETF should propose a wide range of activities from which Sector
Skills Councils and the organisations supporting them can choose their preferred focus. At the outset
in particular, Councils could be encouraged to engage in those activities where there is a greater
chance of success, before encouraging stakeholders to focus on the other priorities of the sector.
The Councils can perform their task best where they have in-depth knowledge of their sector. It cannot
be stressed too strongly that Sector Skills Councils must base their work on evidence and analysis
from the sector they represent. All work should start from analysis of the existing situation and, where
possible, future trends for the sector.
In order to ensure that their work has a positive impact, the Councils should position themselves at the
point between working life and education and training, and they should be assigned clear tasks. The
Councils need a free flow of information from the sector that they represent, while they must also
maintain links with the education and training providers in order to understand the extent of real
possibilities. Finally, they must have a formalised and recognised relationship with those public
authorities in the partner countries to whom they will express their views and deliver the outcomes of
their work. The ETF should support networking between the Councils, the various enterprises and the
training organisations in the sector.
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Sector skills councils. What? why? How? contributing to better VET relevance to the labour market needs
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