Learning and Training for Work in the Knowledge Society

Chapter IV. Learning and Training for Work in a Lifelong Perspective

1. Learning and Training for Work: a Dual Function
2. Social Dialogue, Collective Bargaining and Collective Agreements
3. Institutional Frameworks of Learning and Training for Work
   1. Training Authorities, Councils and Boards
   2. Financing Investment in Learning and Training for Work
   3. Provision of Learning Opportunities and Training for Employed Workers
   4. Active Labour Market and Equity Programmes
   5. Qualifications Frameworks for Learning and Training for Work
   6. Labour Market Information, Guidance and Counselling

Introduction

Learning and training for work is central to the development of a lifelong learning culture that underpins a knowledge-based economy and society, and gives all people access to learning opportunities, throughout their lives. In this report, learning and training for work is understood to encompass all learning and instruction that takes place beyond education and initial training, which was the topic of the previous chapter. Learning and training for work target primarily people in wage or self-employment, and people who are un- or underemployed. They should be accessible to all those who want to change, or improve upon, their skills and qualifications in order to enhance their job and income earning prospects. They increasingly target people who are economically inactive, but who want to gain knowledge and skills for subsequent employment, or just for their personal growth and satisfaction. Chapter III focused on building-up an individual's employability. The present chapter targets its maintenance and improvement, while also considering the learning and training needs of people who lost out earlier from learning and training opportunities.

A. Learning and Training for Work: a Dual Function

Learning and training for work in a lifelong learning perspective "are a means to empower people, improve the quality and organization of work, enhance citizens' productivity, raise workers' incomes, improve enterprise competitiveness, promote job security and social equity and inclusion. Education and training are therefore a central pillar of decent work" (Conclusions, para. 3). Hence, learning and training have a dual function: a proactive, or developmental, function; and a mitigating, or remedial, function.

The proactive function of learning and training is to develop and harness the knowledge and abilities of individuals and enterprises - and the capacity of entire economies - so that they can seize the opportunities that globalization and more open markets potentially offer. Human resources and skills are becoming the key competitive instrument in international markets for goods and services. Learning and training for work must, therefore, focus on developing those multiple skills that will help countries, enterprises and individual men and women seize the new opportunities. Workers will need more knowledge and higher technical skills in order to be able to exploit the productive potential of advanced, particularly information and communications technologies. They will also need new behavioural, teamwork and social skills to help them adjust and retool rapidly; as markets, technology, work organization and opportunities change, knowledge and particularly skills become quickly obsolete and have to be renewed on a continuous basis. A major challenge is therefore to expand opportunities of - and the necessary financing for - learning and training (e.g. lifelong learning) for work, so that they are accessible to all workers.

The poorer developing countries face the formidable task of overcoming the handicaps that have so far prevented them from seizing the new opportunities. Their first priority is to raise the basic education and skills levels of their populations, e.g. by establishing policies and systems for lifelong learning. It is by drawing on those skills and competencies that they can exploit their respective comparative advantages and benefit from the opening up of world markets.

The mitigating, or remedial, function of lifelong education and training is to address the negative employment and labour market trends outlined in Chapter I. Many of these trends have been the unwelcome effects of globalization and related developments in many countries. Education and training are a major instrument, if not the instrument, for enhancing the employability, productivity and income-earning capacity of many disadvantaged people in the labour market, and so for promoting equity in employment outcomes. Learning and training for work can help to correct skills and knowledge mismatches of large segments of the labour force following major economic restructuring, particularly in the transition economies, but also in many developing economies. In developing countries with a rapidly growing informal economy, learning and training are indispensable for improving productivity and living conditions among the large sections of the population who earn a living from informal activity.

Many unemployed workers need new skills and competencies that will enhance their chances of re-entering stable employment. Women and other victims of discrimination need education and training to give them access to more and better jobs in the labour market and to overcome the syndromes of poverty and social exclusion. Workers in precarious and insecure jobs, and often intermittently unemployed, need to renew their rapidly deteriorating skills in order to improve their prospects of finding more stable jobs that also offer them a career.

The dual function of learning and training is a central feature of education and training policy frameworks in many countries, for example in Egypt, Mexico, Tunisia and South Africa. In Egypt, proactive training that assists enterprises adjust to the needs of new skills, technology and work organization goes hand in hand with active labour market measures, including training for the unemployed and measures that encourage income-generating and training activities for poorer groups of the population. The European Union (see box 4.1) exemplifies a regional dimension of such developments.

B. Social Dialogue, Collective Bargaining and Collective Agreements

Globalization, structural change and rapid technological development have far reaching consequences for human resources management at the enterprise level, on skills and competencies, and on learning and training practices. Social dialogue provides a means to anticipate, and smooth out difficulties arising from, changes in work organization, working conditions and employment patterns. In most countries, training for work in a lifelong perspective has become a key subject in dialogue among social partners, and between them and governments. However, the scope and effectiveness of social dialogue and partnership in training is currently limited by the capacity and resources of actors. It varies between countries, sectors and large and small enterprises. Recent regional economic integrations also brings a new dimension to social dialogue on training and a need for capacity building. (Conclusions, para. 17).

Social dialogue on employment and other social issues can take many forms, from ad hoc or informal to formal discussions and negotiations. It may occur at enterprise, sector and national levels. In many countries, it engages established institutions and operates within a legal framework for labour relations. In recent years the scope of social dialogue has widened. In addition to established workers and employers organizations, social dialogue includes often many other actors dealing with training and employment issues, including at regional and local levels.

Social dialogue practices are in many countries underpinned by strong national traditions. Bi- and tripartite approaches to employment and training policy development have increased. Partnerships within the private sector and between the private sector and public authorities have been pursued at different levels. They aim at addressing more (cost)-effectively current developments in labour markets, in particular the new demand for skills.

Improving and maintaining the employability and quality of the workforce are central themes of social dialogue on human resources development. Issues of learning and training are often also part of negotiations on other employment issues, particularly when enterprises are restructuring and unemployment is growing. Major collective bargaining issues touch upon increasing and sharing investments in lifelong learning and training, identifying skills needed for maintaining internal or external employability, and establishing qualifications frameworks, including mechanisms for skills recognition and certification.

Equal opportunities and access to lifelong learning and training are becoming a recurrent, cross-cutting theme in negotiations and collective agreements on training. However, equity targets which have been agreed upon by the social partners and set up in many countries have not yet been achieved. The equity dimension and accessibility to lifelong learning concerns particularly women, workers having little education, workers at risk of being laid-off, workers in small enterprises and those engaged in informal activities. These workers comprise often a large proportion of the working population, but are generally poorly represented in collective bargaining and seldom benefit from it. The PLANFOR (Plano Nacional de Formacao Profissional) Programme in Brazil, an outcome of tripartite social dialogue, provides for learning and training that target marginalised groups. Section C.4. in this chapter examines briefly PLANFOR's programmes for disadvantaged women. Sector agreements sometimes also incorporate their needs. However, active labour market programmes and other remedial measures, taken mainly by the public authorities, are often their only opportunity to access training.

The organisation of lifelong learning and training is also a subject of social dialogue. Negotiations generally focus on financing, management of resources, establishing qualifications frameworks, skills recognition and certification, managing programme quality and effectiveness and meeting equity objectives of training. Training provision tends to be less an issue of collective bargaining, as training providers have multiplied, competitive training markets have emerged in many countries, and learner-centred modes of training, often using ICT, have spread rapidly. Generally, quality and equity criteria of training are established through social dialogue and are applied and managed through procedures for financing training. Recently, dialogue has developed around new topics such as workplace learning, the role of ICT in this process, and on lifelong learning and training in high performance work organisations. Some of these aspects are addressed later in this chapter.

Bi- and tripartite agreements on lifelong learning and training have multiplied recently, particularly in industrialized countries, as governments, employers' and workers' organisations have engaged in collective bargaining at the enterprise, sector or national level. The agreements stipulate workers' rights and certain regulatory conditions. They have also contributed to institutional frameworks at sector or national levels, often with the financial partnership of the government. Collective bargaining and dialogue with governments have, in many countries, led to the establishment of training funds that finance lifelong learning and training, for example in France, Spain (see box 4.2), Netherlands, Denmark, and Sweden, and also in developing countries (e.g. Benin, Senegal, Mali). Other arrangements provide for national qualification frameworks and skills recognition and certification (UK, South Africa, Australia and New Zealand). Hence, training clauses of collective agreements tend to provide a good basis for establishing and sharing responsibilities, for building different types of partnerships, and for promoting equity in training.

The role of governments is changing rapidly, particularly in countries that have a well established culture of collective bargaining and social dialogue. There, rules about lifelong learning and training are the outcome of continuous interaction between legislation and agreements, France being a typical example. The legislator often recognises the existence of a substantial body of agreed rules formulated through the bargaining process and enforces their general application. In other cases the government imposes its rules on the social partners by means of clauses that encourage the private sector to assume a greater social responsibility for, and invest more in, training.

Social dialogue and collective bargaining on lifelong learning and training therefore establishes two sources of rights: the law and collective agreements. They also endorse the parity principle in managing sound and structured training systems. The systems that emerge from the bargaining process display the following major features: the recognition of a legal right to lifelong learning for the employee; joint management of resources by the social partners; and a set of guidelines and operational frameworks necessary for providing lifelong learning and training programmes. Governments increasingly encourage the social partners to engage in collective bargaining, while concentrating their efforts on providing training opportunities for the most vulnerable groups - women, the disabled and other groups with special needs - by means of active labour market and equity oriented programmes. By means of incentive measures they encourage regional and local partnerships and also public education and training institutions to deliver training programmes for these groups.

Social dialogue in new integrated economic regions is also emerging as a result of public pressure and direct initiatives by employers' and workers' organizations. In the European Union, the practice of "joint opinions" resulting from dialogue on social issues, including training, has gradually given way to negotiations of European framework agreements. The social partners can address subjects of common interest, and introduce innovations of lifelong learning and training. National negotiations on employment and training have increasingly a European dimension. The objective is to transform the skill profile across Europe in order to meet the needs of the emerging knowledge-based society and address problems of labour mobility. ICT is a central theme. Other economic regions, e.g. in Asia, Latin America and Africa, are also engaging in social dialogue on lifelong learning and training issues.

As illustrated by a few examples below, social dialogue has been decisive in promoting policy developments and building up effective partnerships in the area of human resources development and training. Ensuring employers' and workers' participation in policy setting has been the foundation for Australia's, South Africa's and European and Latin American countries' training system reforms.

Australia's industry-led National Training Authority (ANTA), established by the federal and state authorities, engages the trade union movement in social dialogue on vocational education and training. The Deputy Chair of ANTA's Board is an Assistant Secretary of the Australian Council of Trade Unions (ACTU). The Authority has embarked on an ambitious plan to: develop new accreditation procedures for institutions, training providers, courses and for skills learned, encourage private providers to expand and improve the quality of their training supply, and to develop a nation-wide system of competency standards on an industry-by-industry basis. The central intent of ANTA is to pass control for learning and training from the suppliers of skilled workers, hitherto mainly government institutions, to those actually demanding these skills, i.e. industry.

In Ireland, social dialogue has taken the form of a set of national programmes that reflect its recent history of, and priorities for, economic growth and social development, i.e. the Programmes for National Recovery 1987-90, Economic and Social Progress (1991-93), Competitiveness and Work (1994-96), Inclusion, Employment and Competitiveness (1997-99) and Prosperity and Fairness (2001-02). The early agreements were between the main social partners, i.e. business and farming organizations, the Irish Congress of Trade Unions and the Government. More recently the Programmes have included agreement on social policy, in which the community and voluntary sectors have been engaged, thus broadening the negotiating forum. These agreements include a wide range of provisions regarding education and training.

In Cyprus, social dialogue has been instrumental in creating the tripartite Industrial Training Authority (ITA). This body administers a training levy (0.5 per cent) on all enterprises' pay roll, formulates training policy and undertakes research on industry training needs and job and occupational analysis. The system is market-oriented but with heavy social partner input on matters like training policy, skill standards, sectoral collective bargaining and labour market policy. The present policy of up-grading workers' skills covers continuously three quarters of the workforce. Training approvals have risen ten fold since the 1980s and cover close to all skilled worker specializations demanded in the economy. In Cyprus, social partnerships, public intervention and the private sector have collectively contributed to an effective system of human resources development and training².

In Latin America, until recently, and with a few exceptions, the dirigiste model of governance concentrated power in the hands of governments' bureaucratic elites. Vocational training was done under the auspices of one large institution that was responsible for defining and implementing public training policies at the national level. With democratisation and growth of civil society and institutions, training is more and more negotiated between employers and workers and a wider range of social actors. It has also been decentralised to local governments and associations of civil society and to key sectors. In Chile, the establishment of Bipartite Training Committees was encouraged by law in an effort to further advance the democratisation process at the plant level. Committees have been established in enterprises in order to stimulate dialogue over worker training. In Uruguay, the creation of the National Employment Junta, a multipartite body with its own resources designated to support new training initiatives, was a decisive step towards intervention in employment and training policy formulation and implementation. There is also in Brazil a tripartite body (CODEFAT, the Deliberative Council for Workers' Support Fund) at the federal level, at the state level (State Employment Councils) and at the municipal level (Municipal Employment Councils). As in Uruguay, a special fund was created that allocates substantial resources to employment and training initiatives around the country³. These experiences in Latin America suggest that social dialogue around training can contribute towards reducing conflict between management and labour over workers' skills, qualifications and layoffs. It can also assist in better targeting of training programmes so that these benefit disadvantaged population groups⁴. (See Posthuma, A: Recent Transformations in Training and Social Dialogue in Latin America)

C. Institutional Frameworks of Learning and Training for Work

Democratisation and social dialogue have, in many countries, spurred the growth of new institutions, particularly in the social area, including employment and human resources development. Government, employers' and workers' organisations are engaged in a continuous process of evaluating and reforming their education and training systems. Lifelong learning and training for work is central to these reforms. OECD countries and some other countries, for example Mauritius and South Africa, are integrating their policies for economic and human resources development. These countries are making rapid progress in ensuring their workforces opportunities for lifelong learning. Most developing countries, particularly the less developed, struggle with the task of providing basic education to all children and young people. They also have to address the needs of their adult workers, particularly those with little education. Institutional frameworks and the role of the partners in learning and training for work in different countries have consequently evolved differently.

Lifelong learning and training strategies create new challenges for policy and programme coordination, financing and provision of learning opportunities to all. They call for an integrated vision of education and training over an individual's entire life span; a wide range of education and training pathways; new settings for learning and training, including formal and informal modes; and an expanded range of partners. It also demands new systems of resource allocation; new incentives, including skill recognition, certification and guidance to motivate individuals to learn; and a change in collective and individual behaviour. There is a need for new institutional frameworks and major reforms of existing institutions. Some recent institutional developments are presented below.

1. Training Authorities, Councils and Boards

In a common trend, countries have, in recent years, established national frameworks for human resources development and training that provide overall guidance on reform of education and training systems and institutions in a new lifelong learning perspective. The government has generally taken the initiative of developing these frameworks, but with the support and participation of the social partners. Commonly also, these frameworks have been codified in national legislation, which can take the form of a single comprehensive act, like in Malaysia (the Human Resources Development Act, 1992) and in South Africa (National Skills Development Act, 1998). They can also comprise a set of different, but mutually supportive laws that cover various areas of education and training. These frameworks and laws provide for the establishment, or reforms, of existing institutions, often with enhanced responsibility and participation of the social partners.

Commonly, national legislation and frameworks on human resources development have spurred the growth of tripartite and bipartite institutions for the governance of learning and training for the world of work. These have different names, commonly called Training Authority, Training Council or Training Board. Acting often as autonomous bodies, their operations are based on policy guidelines that have been established by national socio-economic, employment and labour councils, like in many European countries and the NEDLAC in South Africa.

These training boards have different briefs depending on the national context. Often established to advise governments on education and initial training reforms, many have focussed their activities on linking learning and training to enterprise issues such as competitiveness and improving workers' employability. Their functions may be primarily advisory, promotional and proactive, and based on analysis of, and dialogue on, employment trends and skill requirements. Their clients are governments, employers, training institutions and other partners in lifelong learning and training. They often assume regulatory functions, for example in such areas as establishing criteria for, and supervising training quality; defining priorities and allocating resources; endorsing training standards; establishing criteria for accrediting training institutions, providers and programmes; and overseeing that equity objectives are met in increasingly market-based systems of learning and training. In some countries, they oversee their own training institutions. The effectiveness of these boards is often enhanced when they operate in a decentralized manner, addressing sector-, industry- and local area-based training needs. They have often been active in developing various types of networks and partnerships, for example between large and small enterprises, in groups of SMEs, with local authorities and development agencies, and other public and private partners at local and regional levels.

In Austria, the Federal Advisory Council on Vocational Training and its regional counterparts, the State Advisory Councils on Vocational Training, are responsible for advising administrative authorities on vocational training matters. The initiative to revise training regulations normally comes from the social partners, and the content is usually drawn up by the Council. The Advisory Council is also empowered to submit reports and proposals to the federal education authorities on all matters relating to vocational training provision regulated by the Initial Vocational Training Act. The Advisory Council can take the initiative itself, or respond to requests from the Federal Economics Minister or the federal education authorities⁵. (See CEDEFOP: Vocational Education and Training in Austria)

In Egypt, the tripartite Supreme Council, served by an Executive Committee and a technical secretariat, formulates training policy. Its Policy Statement on Skills Development (1999) focused on institutional reforms, the role of private sector training providers, and training qualifications and standards; financial reforms, management and control; establishment of a national qualifications framework; reviewing donor-supported initiatives; reforming the administration of government training centres; development of sustainable funding arrangements; and establishment of performance monitoring systems.

Ireland provides a good example of interaction between legislation and the evolving institutional framework for learning and training. National training policies are decided by consensus and contained in three-yearly agreements drawn up by a socio-economic council. The agreements cover a wide range of economic and social policies and not only training. Government policy emphasizes retraining laid-off workers. A policy report that examines lifelong learning is due in mid-2001. Training policy is implemented through a national training body known as FAS (An Foras Aiseanna Saothair). Recent legislation provides for a new national institution, the National Training Fund (NTF) that finances training. The Labour Services Act, 1987, gives FAS the responsibility to provide training in all industries and organizations. FAS could require a particular industry to establish a bipartite Industrial Training Committee to oversee its training programmes. Until 2000, the Committees also had the power to impose a levy on employers to finance training. However, the newly formed NTF will take over this responsibility and the funding of FAS. 1993 legislation provides for the funding of apprenticeship. This scheme is a partnerships between industry, FAS and vocational education authorities. Finally a National Qualifications Act (2000) lays down the procedures for setting up academic and workplace bodies to ensure effective accreditation of workplace learning.

Many other countries are going through similar processes of institutional and legislative development. However, these tend to lead to different institutional arrangements that depend on national conditions and the capacity of the social partners to assume responsibility in managing, financing and running the institutions. In many, particularly developing, countries however, the State continues to assume prime responsibility, while in developed countries it is devolved to the social partners.

These institutions do not operate only at the central level. They have often decentralised many of their functions to the regional, local and sector levels in order to improve the relevance and responsiveness of training and accommodate better the specific dimensions of training needs at these levels. For example, in Argentina, the Vocational Training Council of Rosario and Region (CCFP) created in 1997 is a bipartite entity that has established links with municipal and national authorities, and is engaged in improving curricula, the cost-effectiveness and quality of training of institutions in the region. In Norway, the National Council for Vocational Training (RFA) comprises sectoral training councils. These provide national authorities and the RFA advice on training in recognised occupations for which they are responsible. They are engaged in activities of institution- and workplace-based training, including skills recognition. They also advise the county, exercising major responsibility for implementing vocational training on behalf of the county authorities.

Key elements of these new institutional frameworks are the polices, institutions and mechanisms for financing learning and training. These are examined below.

2. Financing Investments in Learning and Training for Work

Countries commonly tap a variety of sources to finance training. For example, China uses government budget allocations, self-financing by enterprises, non-profit organisations, loans, tuition fees, income creation by training institutions, donations and grants to finance training. State regulations stipulate that 1.5 per cent of enterprises' payroll shall be used for workers training. A certain proportion, usually 15 per cent, of local governments' employment and unemployment insurance funds shall be used for pre-employment training, and retraining of the unemployed⁶. (See Ministry of Labour and Social Security: Vocational Training and Employment in China)

The Conclusions, para.11 recognized that investing in education and training can be a shared responsibility of both the public and public sectors. Governments "must always assume the prime responsibility for investing in basic education and initial training"; and "share the greatest responsibility for investment directed at groups" that run the risk of social exclusion or discrimination. Governments also assume a prime responsibility for ensuring that individuals are not denied access to education and training on financial grounds. On the other hand, investment in workplace-based lifelong learning and training that raise workers' employability and enterprises' competitiveness is the domain of both enterprises and individuals. Private sector responsibilities in this area are best accomplished through partnerships between governments and enterprises, between government and the social partners, or between the social partners.

Shortages of financial resources is practically a universal problem and education and training has been an area of often chronic under-investment in many countries, particularly in the developing world. Slow economic growth has put a strain on government financing of education and training. Public educational budgets often fluctuate widely and have frequently decreased in relative and absolute terms. Enterprises rely less and less on the public training system for meeting training needs that arise from their efforts to keep abreast with rapid technological and workplace change and maintain competitiveness. They often consider public training inefficient and divorced from their needs. They consequently finance and also deliver their own learning and training programmes. Soft skills, e.g. team working skills, are increasingly demanded as enterprises introduce flatter organizational structures. These skills are also best developed in the workplace, giving the enterprise an absolute advantage of investing in workplace-based learning and training.

Hence the call for diversifying the sources of financing in order to increase and, importantly, improve the quality of, investments in education and training. A general principle often followed has been to base investment responsibilities on the objectives of training, e.g. individual, enterprise and societal objectives. Enterprises and individuals are the main beneficiaries of education and training. They are consequently being asked to assume a greater share in financing learning and training programmes.

Meanwhile governments more and more focus their efforts on creating an environment that will encourage private sector partners to invest in education and training. They deploy various incentives - legal, financial and motivational- that induce enterprises and individuals to invest in education and training. However, they directly intervene in financing learning and training in those areas where there is little incentive for enterprises and individuals to invest in learning, for example by supporting learning and training for SMEs. Governments finally assume the social responsibility of investing in learning and training services that target underprivileged groups, in an effort to integrate them into economic and social life.

Governments' Role in Financing Learning and Training for Work

The financing of active labour market programmes is a primary task of many governments. In countries of the European Union, governments' financing of these programmes come under the umbrella of national action plans for employment. These plans are given a significant boost by supplementary funding from the European Social Fund (ESF). In addition to other objectives, e.g. economic and social reconversion of areas facing structural difficulties, the Fund supports efforts to combat long term unemployment. It also facilitates transition into skilled work of young persons and people who have been excluded access to the labour market. For the 2000-06 period, around 60 per cent (€34 billion) of the Fund's total budget of €57 billion is allocated to active labour market programmes that improve employability across the European Union. Out of this sum nearly a third (€11 billion) is earmarked for the fight against social exclusion. The Fund also supports entrepreneurship development (€8 billion) and improving the adaptability of the European labour force by prioritising the lifelong learning, ICT use and SME oriented activities (€11 billion). Specific programmes to support gender equality have been allocated another €4 billion⁷.

In Denmark, the National Action Plan for Employment has been instrumental in reducing unemployment between 1992 and 2000 by almost half (from 9.2 to 4.7 per cent). The Plan has formulated ambitious objectives to reduce youth and long term unemployment. Every young person is offered an individual employment plan that gives her or him an opportunity to start a job or undergo training within six months after having registered as a job seeker. Considerable success has been achieved; youth unemployment has dropped from 12.7 per cent in 1992 to 7.3 per cent in 2000⁸. For the 2000-06 period, ESF has allocated some €380 million in support of active labour market measures in Denmark, with the Fund's contribution amounting to 1.8 per cent of total national expenditure on such active measures. In some other countries the share of the Fund in financing active measures is much higher, e.g. in Greece (58.4 per cent of total expenditure on active labour market measures) and Portugal (40 per cent).

Market imperfections often lead to under-investment in education and training. The case of training in and for SMEs is a case in point. Again in the European context, many government programmes, assisted by ESF, encourage more effective transfer of technology, particularly ICT, to SMEs by means of employee training, support for the development of ICT networks. and by improving collaboration between SMEs and ICT research and development centres. Development of multi-media training packages and a range of open and distance learning methods to promote ICT skills development in SMEs are features of many programmes⁹. Partnerships between SMEs and between SMEs and other institutions can also overcome market imperfections and raise investments in training. Partnerships are reviewed in some detail in section 3.

Enterprise Investment in Learning and Training for Work

The Conclusions, para. 12 recognized that enterprises "have a critical role to play in investment in training". In a large number of countries the private sector is responsible for skill development on a substantial scale. The state may have dominated the provision of high-profile institutional training. However, the private sector, through innumerable types of learning and training activities, many of them informal and discernible only to those directly involved (see further on workplace-based learning, Chapter IV, C.3), may well be making the greater contribution overall¹⁰. (See Dougherty, C.: Financing Training) Some firms, particularly in competitive high technology sectors, spend significant shares of their operating expenses on training staff. For example, Singapore Telecommunications Limited spent 4 per cent of the payroll on training in 1998. On average, each employee was allocated two training places and received 40 hours of training. According to the annual bench-marking exercise of the American Society for Training and Development (ASTD) covering selected countries and regions, training investments in 1998 where highest among respondents in the United States ($724 per employee) and lowest in Asia ($241 per employee). Calculated as a percentage of payrolls, training expenditures were highest in Europe (3.2 per cent), followed by the U.S. (2.0 per cent) and Japan (1.2 per cent). These figures are roughly indicative of training investment in those enterprises that responded to various national surveys compared in the ASTD report. They do not represent the training investments of all enterprises¹¹. (See ASTD: Adding It Up: How Much Training Do Organizations Provide?)

The Conclusions advocate the use of a various mechanisms to further investment in training. These may include levy systems on enterprises accompanied by public grants, establishment of training funds, various incentives for training and learning, e.g. tax rebates, training credits, training awards, individual training accounts, collective and individual training rights. Some of the mechanisms are briefly reviewed below.

Levies

In the interest of securing stable and adequate financing of vocational training countries sometimes pre-allocate or earmark certain direct taxes exclusively for vocational training. These levies may be assessed by public authorities in the form of compulsory taxes, or voluntarily through industry groups, for example in the case of German Industrial Chambers. Levies can be of two types: based on the output, or on the payroll of enterprises. Levies generally have the overall advantage of high potential for revenue mobilization. Out-based levies have been used in such countries as Ecuador, Kenya and Mexico. More important are payroll taxes which are used in a large number of developing and developed counties. The latter take the form of revenue generating schemes and incentive-based schemes.

Revenue generating payroll taxes have been used particularly in Latin America. The money raised through the levies has financed training institutions managed by the social partners. With sustained, reliable financial resources raised by means of the levy, various training agencies like SENAI, SENA and INCE have developed into strong organizations capable of responding widely and quickly to changes in the market requirements for skills. However, such levies have in some cases reduced self-financed training by firms. Box 4.3 illustrates another type of revenue generating mechanism run by the Japanese Employment Insurance Scheme.

Incentives-based payroll levies are intended to encourage enterprises to establish or broaden their in-plant training provision. Incentive schemes are of two basic types: disbursement schemes where the tax is collected from all enterprises, then disbursed back to some firms that meet training criteria; and exemption schemes whereby firms are able to reduce or eliminate the payment of the payroll and other taxes to the extent that they provide acceptable training in-house. Although used in many countries, levy/grant systems have often failed to increase workforce learning, which is usually their primary function. They often build up a cash surplus; due to bureaucracy and complicated application procedures few companies seek grants for training.

Singapore's Skills Development Fund runs a disbursement scheme that has been highly successful in raising training investments by enterprises. It also gives financial incentives to workers who prepare to join the workforce and those re-entering the workforce. It encourages the development of higher level skills to support economic restructuring and knowledge intensive industries. The Fund collects a levy and provides employers grants for approved training programmes upon consideration of their individual merits. As an incentive for enterprises to upgrade their workers' skills, the levy is imposed on the wages of low skilled workers earning less than 1500 Singapore dollars (S$) monthly. The levy has changed frequently as international economic conditions have changed. It was set originally at 2 per cent of eligible wages, was raised to 4 per cent in the boom years in the early 1980s, and is at present 1 per cent. In 1998, some 565,000 training places were supported through grants by the Fund. In that year S$88 million were committed, raising the total amount committed since the start of the Fund in 1979 to S$1.5 billion. The SDF is successful because its practices change as conditions change. It is now only applied to low-skilled workers.

France has two exemption schemes, the apprenticeship tax (0.5 per cent of payroll) for initial training, and the training tax (1.5 per cent of payroll among enterprises having 10 or more employees; 0.15 per cent among those having less), used primarily to finance lifelong learning of enterprise staff. The focus has shifted from general educational and cultural development of staff towards continuous education and training for employment. All enterprises benefit in proportion to the number of employees they have. The scheme has led to increased training expenditures that surpass the total amount of taxes paid by enterprises.

In another variant of exemption scheme, Chile gives enterprises a direct credit, up to certain limit, on taxes (income or payroll) that they would otherwise have to pay. The Chilean scheme has been quite successful as employers considered that they were in control of training initiatives and that it saved them money to train staff rather than pay the tax. By contrast, the Brazilian Tax Rebate Scheme has been less effective, due to e.g. lack of information about the system, unclear requirements, and complicated procedures in applying for exemption.

Training agreements and training funds

Voluntary collective agreements can raise enterprise contributions above any compulsory contributions. The potential is greatest in middle and high income countries where the enterprise sector is developed, collective bargaining is done on a sector- or industry-wide basis, and where both employers and workers value the contribution that training makes to productivity and competitiveness. Collective agreements at national, sectoral or enterprise level often include special training-related clauses and provide for creation of sectoral and regional training funds. Voluntary training agreements have been established in such countries as Belgium, Denmark, France, the Netherlands and Sweden. In Denmark, sector collective agreements that contain a training clause cover an important part of the entire Danish workforce.¹³ Box 4.4 illustrates some collective agreements in Europe to establish training funds that finance workers' lifelong learning and training.

Other European countries and many African countries, like Côte d'Ivoire, Morocco, Cameroun, Benin, Tchad, Zambia, Zimbabwe and others, and also Asian countries, e.g. Malaysia and Singapore, have established training funds, which often raise the bulk of their resources from training levies. For example, in Côte d'Ivoire, the Fonds de Dévéloppement de la Formation Professionelle (FDFP) raises resources, manages enterprises training plans, and supports training in non-contributing informal and small enterprises, and for specific target groups. The FDFP manages 50 per cent of levy proceeds for lifelong learning activities(1.2 per cent of payroll); the other 50 per cent are managed by the enterprises themselves for training that meets FDFP criteria.

Training awards are another tool to encourage investments in learning and training. Awards are given as a recognition to enterprises and institutions for excellence achieved in their learning and training programmes. They act as models and benchmarks for other enterprises and institutions to emulate. For example, the Irish Institute of Training and Development organizes an annual awards scheme for enterprises whose training arrangements meet specified criteria. It resembles the Investors in People Scheme in the U.K., an initiative of the Confederation of British Industry. The Government of Bahrain gives an award to the enterprise judged to have performed best in training during the year. The award is based on the level of enterprises' training investment and on the number of Bahrainis trained and who subsequently replace expatriates. The Portuguese Institute for Innovation in Training (INOFOR) gives awards for good practice in training. There is also a move to establish a Forum on human resources development and training which would decide on awards based on bench- marking procedures.

Financing Learning and Training for Work: Empowering the Individual

Various mechanism are deployed by governments, and also employers, to empower the individual to assume responsibility, including financial responsibility, for his/her own learning and training. They include fellowships, vouchers, student loans and new financial mechanisms like "individual learning accounts". These are briefly reviewed below.

Training vouchers are entitlements to certain broadly defined training services for a given amount of money. A certificate can be issued, or the individual can receive a tax credit. Vouchers are designed to raise training efficiency and effectiveness by enhancing the individual's choice. The assumption is that individuals, if given free choice and enough information about the training provider and the labour market, will select, firstly, the type of training that will maximize their future returns. Secondly, they will choose the training provider that is most likely to produce successful graduates with good job prospects in the labour market. Vouchers are also a means to ensure that individuals have access to training. For example, the region of Styria (Austria) runs three voucher schemes that target different clienteles: training vouchers for individuals who want to start their own business; training vouchers for those who have completed an apprenticeship but want to undergo further training over a period of five years after apprenticeship; and training vouchers for people who want to gain special qualifications in areas such as computing, CAD/CAM and marketing. In all these schemes the duration of training must be at least 80 hours. A certificate is awarded after successful completion of the course¹⁵. (See Heidemann, Winfried: Individual Learning Accounts: a Tool for Financing Lifelong Learning) Another example is the voucher scheme run by the Micro-Small Enterprise Training Fund for entrepreneurs in Kenya's jua kali sector (see Chapter IV, C.3).

Vouchers often rely on the private market to deliver training. Substantial monitoring systems must be created to keep up to date accreditation of institutions and to prevent fraud and abuse. Without information and knowledge about training courses available, vouchers may encourage recipients to waste money on inappropriate and poor quality training. Moreover, voucher systems could undermine public providers if individuals made them the institutions of last choice. Equity problems could arise because individuals with more resources could afford to pay additional expenses above the voucher and presumably receive better training.

Student loans can under certain conditions be an attractive means to promote financing of training by beneficiaries. The loan finances immediate training that is repaid over the long term out of increased earnings that accrue as a result of the training. In the United States an extensive system of student grants and loans is used for attending many proprietary schools, community and technical colleges and universities. In 1996-97, US$ 28.5 billion was expended on student (and family) grants and loans at all levels. However, systems of student loans are not easily adopted in developing countries. Few loan schemes are available there, and those that exist target university students. Those that presently operate require substantial administrative systems to review applications, disburse funds and especially arrange repayments. Student loans schemes are not very appropriate for lower income countries, for lower income individuals, and for lower levels of training. They would be most appropriate for advanced skill levels and for short training programs with immediate job prospects. Still, while student loan programs do not promise immediately to mobilize additional private resources for learning and training, they should be seen as one element in a package of policy measures.

Individual learning accounts Recent years have seen much debate about, and some experiments with, so-called individual learning accounts. These are tools to enable hitherto under- represented groups of workers, like those with low incomes and education, to access lifelong learning opportunities, widen their choice of learning, and empower them to meet their own learning needs in the training market. Supplemented by public and often employer subsidies they encourage individuals to invest in their own learning and training.

Austria and the U.K. have initiated learning accounts schemes, and Sweden will start one in 2002. In the U.K., during the start up phase 2000-02, the government gives individuals a subsidy of £150, directly paid into a "virtual" account with a training provider, together with a contribution of at least £25 paid by the individual. The government plans to finance a million learning accounts, the subsidy varying according to the type of training. IT courses attract a subsidy of 80 per cent up to a max. of £200, while other courses receive 20 per cent up to a max. of £100. In a pilot project in Gloucestershire, most learning accounts were opened by low income earners, middle age and older individuals, and people with little education. Three quarters had an annul income of less than £15,000. Courses covered a range of areas, a third in ICT.

Sweden is planning to launch an ambitious national individual learning accounts scheme (IKS - Individuellt Kompetenssparande) in 2002. Unlike in Britain, individuals engage in savings agreements with banks, insurance companies or fund management organizations. Based on contributions by the government, employers and individuals some 1 million accounts will be established for individuals aged 30-55 and earning yearly €6,000-€25,800. Provided they put money into their account they will receive a subsidy of the same amount up to a limit of €300. Money can be withdrawn from the account in order to finance further training courses of at least five days' duration. Such withdrawals are taxable, but are subsidised by a state skills support payment, up to a max. of €1,125 for long-term further training. In 1999 the parliament allocated some € 140 million to the scheme; to this will be added yearly approx. € 35.8 million to fund the tax relief on employer contributions to the accounts.

Unlike the British scheme, IKS does not build on pilot projects, but on the experience of individual companies. One example is the Skandia insurance company, which runs an individual training insurance savings scheme that finances paid training leave. If employees save on an insurance account, the company also pays contributions on to a parallel account. If that individual then makes use of his/her right to training leave, the money accumulated on both accounts is used to finance continuous payment of wages. In the two years that the Skandia project has been running, 40 per cent of employees have signed individual agreements with the company.

3. Provision of Learning Opportunities and Training for Employed Workers

Partnerships

Partnerships in various combinations between government, employers' organisation, trade unions local government, enterprises, intermediary institutions and other stakeholders are increasingly the favoured arrangements for providing learning opportunities for training for work. The combinations of partners are multiple. Sometimes partnerships are established at national level to promote training efforts for improved competitiveness of enterprises across sectors. Skill development activities often combine with other practices for improved enterprise performance and better conditions in the workplace. They can also have an equity dimension by targeting particular groups of workers, for example low paid and poorly educated workers who need basic skills to boost their employability and income earning prospects. Learning programmes can range from basic literacy and numeracy to professional training. The majority of learning and training partnerships tend to have a sector, industrial branch or "cluster" focus.

In the USA, the School-To-Work Opportunities (STWO) Act (1994) promotes the establishment of local partnerships that include employers, education institutions, educators, unions and other groups such as professional bodies. Work-based activities are mandatory features of any STWO scheme and include work experience, planned programmes of pre-job, on-the-job and progressive training, workplace mentoring, instruction on competences, industrial knowledge, positive work attitudes, and employability. School-sponsored enterprising activities are positively encouraged. By 1998, 1,100 partnerships in 44 states had been established.

Partnerships initiated by trade unions

In the U.K., the Trade Union Congress set up in 2001 a new Partnership Institute which promotes employer/trade union partnerships in industry. Its aim is to commit enterprises to organizational performance through learning and training and make them responsive to the needs of changing product markets. It also supports enterprise measures to improve employment security and quality of working life.¹⁶ Also in the U.K., UNISON, a large union covering mostly public sector employees, has introduced a new form of workplace learning, 'Return to Learn' (R2L), in partnership with employers. Box 4.5 gives some details.

Sector and branch-based training provision

There is a long tradition of sector-, or branch-based education and training in OECD, Latin-American and Asian countries. These are frequently run and supervised by the relevant sector employers' association. Being employer-led, sector initiatives have the advantage of providing training that is demand driven and tailored to fit the particular industry's needs.

An example of a recent sectoral partnership is the ICT Skills Consortium which brings together major ICT companies in Europe. The Consortium's objective is to fill the large skills gap of ICT professionals in the industry. Box 4.6 gives some details. In Latin America, various sectoral chambers are broadening the range of services they offer to their members, extending into areas of research and development, and training and skills development. In Mexico, the National Chamber of the Textile Industry (CATEX) provide training services. In Argentina, graphic sector companies have promoted training through the Gutenberg Foundation.(Contribution provided by CINTERFOR).

Addressing the training needs of small and medium sized enterprises

In comparison with larger enterprises, small firms face disadvantages in acquiring knowledge and upgrading the skills of their workers. SMEs often cannot afford training their staff. Courses available may be ill-tuned to their particular needs. Among small firms, entrepreneurs' and their workers' motivation to acquire new skills is important.

Sector-based SME training and partnerships

Some of the most promising initiatives for SMEs have been sector focused and have often engaged intermediary institutions that provide or organise training, combined with services and capacity raising initiatives. These initiatives frequently engage bodies or associations that represent enterprises in a sector.

In Spain, the ASCAMM entrepreneurial association, comprising some 150 small firms (in 1996) in the mould and die making sector, has established its own Technology Centre which provides training courses alongside other services in order to raise the firms' competitiveness. The links between the centre and the association facilitate communication of ideas for continuous improvement of services¹⁹. (See ILO Tripartite Asia and Pacific Meeting on Training for High Performance in Enterprises and Pyke, F.: Learning and Training in Small and Medium-sized Enterprises) In Thailand, enterprises face increasing pressure from leading inward investors to improve performance and quality, particularly among car manufacturers. A government intermediary institution specialising in technology transfer and training, the Metal Industries Development Institute (MIDI), assists small firms in metalworking and associated sectors to upgrade their technology, training and production processes. MIDI has helped establish sectoral entrepreneurial associations, such as the Foundrymen's Society, which can transmit to MIDI and other institutions their needs for training and other services.

Cluster Strategies

Industrial sectors, geographically concentrated in "clusters", can benefit from being served by tailored courses that are available in the area. In the Republic of Korea, the Kumi Electronic Industry Complex is composed of around 150 electronics related firms, mostly SMEs, together with supporting firms and agencies. It is served by specialised educational institutions, like the Kumi Electronics High School and the Keum-oh Engineering College²⁰. (See Kang, H-C: External Supports for SMEs and Collective Approaches to Enhance Competitiveness, Korean Case Study) In Pakistan, the Sialkot surgical instruments cluster has been developed with the help of local institutions such as the Apprenticeship Training Institute of Sialkot and the Metal Industries Development Centre²¹. (See Khalid Aftab: The Surgical Instruments Manufacturing Industry of Pakistan and the Challenges of the New World Trading System) In the USA, the New York garment industry is served by its own dedicated intermediary institution (see box 4.7).

In the region of Valencia in South East Spain, a network of some dozen Technical Institutes provide local small firms developmental services including training, tailored to the specific needs of sectoral clusters in the textiles, footwear, ceramics and toys sectors. Each institute has a link to an association of small firm entrepreneurs, who also comprise the majority of its board members. This arrangement, coupled with a sector focus, encourages the institutes to be more client sensitive and increases the relevance of their services, including training²³. (See Pyke, F.: Small Firms, Technical Services and Inter-firm Co-operation - Spain)

Supply chain programmes are another innovation to train workers in small firms. Governments often support such programmes. When small firms become sufficiently competent they can expect orders from lead firms, which then may transfer knowledge down the chain by providing expertise or facilities, or both. The lead firms, the local small firm suppliers and local training institutions, and possibly other actors, may also enter into a partnership to develop the suppliers. In Argentina, the Sub-suppliers Development Programme promotes cooperation between large and small firms for improved quality, efficiency and technical development as suppliers to lead firms in the automotive, agro-industrial, textiles and steel and iron sectors. With the help of technical assistance from an intermediary institution, small firms receive training in quality control, industrial design, and technological upgrading²⁴. (See Massimi, S.: The Role of SME: Asian and European Experiences - Argentina) Another supply chain initiative is the Global Supplier Programme in Malaysia (see box 4.8).

Groups of SMEs with common needs may form partnerships in, for example, applying ICT, in order to overcome resource problems by sharing training costs, or costs of hiring specialist expertise. They can join in partnership with regional agencies, including training agencies, to identify future skill needs and develop appropriate curricula. In Mexico, the Integral Quality and Modernisation Programme (CIMO) addresses groups of micro, small and medium-sized enterprises that have common problems or characteristics. CIMO provides integrated services, including training, information, consulting, and technical assistance. It operates through Training Promotion Units established within entrepreneurial associations²⁶.

Local and area-based partnership strategies

A broader partnership approach involves the management of change, on an area or local level basis, by integrating training strategies with the provision of other development strategies and enabling inputs. These may include access to finance, quality testing and measurement centres; assistance with implementing health and safety measures; marketing assistance, supply chain and networking programmes; streamlining of regulatory procedures, and the provision of participation-enabling welfare and child care facilities. Such strategies may require cooperation, dialogue and consultation amongst many local and regional institutions and organizations. In El Salvador, members of the Local Economic Development Agency for the Department of Morazon include development associations, women's associations, co-operatives, and foundations. The Agency provides credit, project design and management services, technical assistance in various productive activities, and training in business administration, organization, environment and soil preservation. In 1998, the Agency carried out 24 seminars for training, involving 650 micro entrepreneurs. In Mongolia, local economic development agencies serving the Arkhangai and Bulgan Departments provide technical assistance for micro-credit projects; training courses; and short term loans for women to establish micro-enterprises or cooperatives. Similar agencies have also been set up in Bulgaria, Bosnia Herzogovina and Croatia.

Transforming the informal economy: Addressing the needs of micro-enterprises, entrepreneurs and self-employed workers

In many less developed countries, structural adjustment, economic stagnation and contraction of the formal economy have resulted in massive growth of an informal economy where people eke out a living, however meagre. Training can be an instrument to address the formidable challenge of the informal economy.

Policies for transforming the informal economy

The Conclusions, para. 7, say that learning and training for workers in the informal economy "should go in conjunction with other instruments, such as fiscal policies, provision of credit, and extension of social protection and labour laws, to improve the performance of enterprises and the employability of workers in order to transform what are often marginal, survival activities into decent work fully integrated into mainstream economic life. Prior learning and skills gained in the sector should be validated, as they will help the said workers gain access to the formal labour market". Sub-contracting, accompanied by technology transfer and training, can assist in improving productivity of workers in the informal economy.

Few countries have workable policies and programmes that follow the prescriptions just outlined. In Kenya, however, after benign neglect for more than two decades, the government has recently adopted a dual strategy to encourage economic growth in the jua kali, or informal economy. It has removed legislative obstacles that hinder growth there and invited banks and training providers to participate in a training voucher scheme (TVS) to develop entrepreneurial and technical skills among micro-and small enterprise (MSE) entrepreneurs and workers. A $11.5 million Micro-Small Enterprise (MSE) Training Fund distributes six thousands vouchers yearly to MSE entrepreneurs as 'payments' for training with a provider of choice. The vouchers have had positive social effects as they assist women entrepreneurs (who receive 40 per cent of the vouchers) for business start-ups. The remainder benefits growth-oriented manufacturing micro-enterprises. Most training provides readily useable skills and practices, delivered in less than a month. Most vouchers are used to buy the services of master-craftsmen in various trades, the remainder going to management and other forms of entrepreneurial training. Despite these favourable outcomes, further interventions, such as credit and technology up-grading are needed to enable jua kali entrepreneurs to create more and better jobs, and graduate to the next layer of formal small and medium-sized enterprises²⁷. (See Haan, Hans Christian: Training for Work in the Informal Sector: Evidence from Kenya, United Republic of Tanzania and Uganda)

Redirecting programmes of formal VET institutions has occasionally taken place so as to meet better the skill needs of farming and informal manufacturing and services. In United Republic of Tanzania, the Legruki Vocational Training School used to train for formal wage employment, but did not cover adequately the multiple skills and technologies required for success in self-employment. Based on a market survey in the local area, the curriculum was revised to shift from single to multiple skills, build from local market opportunities, incorporate useful traditional skills, and increase the flexibility of course offerings. A tracer study of about half of all graduates since 1980 found that more than 90 per cent were employed, the majority in jobs on own account in villages or urban areas²⁸. (See Middleton, J.; Ziderman, A. and Van Adams, A.: Skills for Productivity: Vocational Education and Training in Developing Countries)

Upgrading informal apprenticeship

Skills and training supply for the informal economy can be raised by strengthening informal apprenticeship, common in many African countries. An NGO, Enda -Tiers-Monde, operating in several countries, mainly in North-West Africa, targets its training on disadvantaged young people in semi-urban areas, helping them find employment in micro-enterprises, in partnership with informal artisans. For example, parents of the prospective apprentice select the artisan/trainer, whose suitability and competence is tested by ENDA. A 2-3 year training programme is agreed upon by the artisan and the apprentice, supplemented by literacy training in French or a local language. Training is practical and designed for self-employment. External evaluators assess the progress of the apprentice every three months. ENDA often compensates the artisans for the time they spend on training an apprentice, for example, by providing machinery and raw materials. ENDA also intervenes with banks to support artisans who need loans so that they can manage large orders²⁹.

In a new development (Law 10.00, 1/6/2000), Morocco is transforming a traditional, informal type of apprenticeship, based on an oral contract, into a structured, formal system of learning and training, endorsed by law. The apprentice signs a contract for in-house training with an establishment or enterprise, combining it with general and technological training in, for example, a recognized education and training institution, public service establishment, or another enterprise. The apprentice may also sit an examination for a diploma or other qualifications. Enterprises are given incentives to take up apprentices, e.g. exemption from social security taxes; the State also pays for the training of (apprentice) supervisors.³⁰

Enterprise and Workplace Learning

The workplace is becoming a major source of lifelong learning. Learning in the workplace includes apprenticeship, as part of initial training, mostly of young people. Developments to modernise apprenticeships were discussed already in Chapter III. The present section covers workplace learning and training for already employed workers.

Workplace learning is expanding rapidly in enterprises, boosted by online learning opportunities made accessible to employees. Also, many new "soft skills", like team working, initiative, communications skills etc., that are increasingly demanded in today's flatter organisational structures are better learned at work, often informally, than in formal education and training settings. The rise of workplace learning challenges some entrenched practices in traditional training systems. Several countries have recognized the implications for trainers and curricula. Using competency-based assessment techniques, countries like Australia, Bahrain, Egypt and South Africa are establishing systems of recognizing "formally" these informal skills irrespective of where and how they were acquired. Endorsed by the social partners, workplace learning is the now the acknowledged domain and responsibility of enterprises and organizations.

ILO research³¹ suggests that learning does not need to be an accidental outcome at work, but can be used to meet the individual's development needs, while harnessing it to advance the enterprise's strategic and organisational objectives. Learning-rich work environments can be promoted, for example, by capturing and exploiting the vast amount of experience-based or "tacit" knowledge that staff possesses, developing flatter hierarchical structures, and encouraging team-building. Studies in Denmark suggest that enterprises increasingly endeavour to tap such tacit knowledge and develop informal ways of learning, comprising both individual and team-based learning. The job context provides the opportunity for people to learn from the supervisor and team mates, and to benefit from participation in a shared project³². (See Shapiro, H.: ICT Skills in Denmark) Mentoring assumes an increased importance in the learning process. Box 4.9 illustrates the new context of team- and workplace- based learning.

Learning and training are more effective when "bundled" together with other organisational and human resource management practices, e.g. recruitment and selection of staff, performance related pay, work (re)design and building of trust between management and staff. These practices are common in so-called high performance work organizations (HPWOs). Hewlett Packard, the electronics company, gives all its employees a computer so that they can access web-based courses. At Nokia, the learning process is more and more a responsibility of the individual staff member. The company provides the "enabling environment" conducive to learning. Workers there can experiment and learn without fear of punishment for making mistakes.

In high performance work organizations, all employees are engaged in learning. By contrast, in traditional organisations that display sharp divisions of labour, only managerial and technical staff tend to have access to training. Through their work, HPWO employees are learning and linking their behaviour to the achievement of organisational goals. The US Social Security Administration (SSA) has extended the brief of its human resources development function to also cover career and organisational development and performance improvement. It identifies gaps between the skills needed to meet SSA's aspirations and those currently available. Targeting some 65,000 federal and 12,000 state employees, the SSA is using modern learning and training technology. At Thorn Lighting, a U.K. based manufacturing company, training and learning is at the vanguard of its drive at technological innovation, supported by such practices as cellular-based manufacturing on the shop floor, building trust among employees, sharing information and rewarding performance. Line operators undergo basic assessment and training for team work skills; all employees are also given a basic understanding of team working.

4. Active Labour Market and Equity Programmes

Active Labour Market Programmes

High and persistent unemployment and marginalization of particular groups in society has given rise to greater emphasis on active labour market programmes, rather than passive support measures for unemployed persons. These programmes target specific groups, including women in general, young workers, the long-term unemployed, older and displaced workers and workers with disabilities. They are designed to meet the particular needs of these groups, which go beyond training in specific skills, to include basic literacy and numeracy training, job-search assistance, vocational guidance and counselling, retraining, employment and wage subsidies, public works programmes, micro-enterprise development programmes, and other support services, where required. The implementation of these programmes involves public services and other partners, including private training providers and non-governmental organizations, frequently working under contract to the public sector.

The results of altogether 120 evaluation studies of active labour market programmes in OECD and developing countries, suggest that individual labour market programmes, implemented in isolation from other supportive policies and measures, are often likely to be ineffective³⁴. (See Betcherman, G. & Islam, R: Active Labour Market Policies: Issues for East Asia) Their success rate is likely to increase when:

• training programmes are combined with work experience. In addition to providing training, work placements provide access to employers, who can vet potential employees on the job, while they receive job-specific training, which will increase their value to the employer. The removal of the initial access barrier and the provision of sheltered entry into the workplace may be the strongest argument for including work placement in training programmes. Most successful are those programmes that place trainees with private sector employers rather than those offering temporary placement in public sector job creation projects;?
• training programmes are
  1. targeted to meet the individual needs of specific groups and
  2. based on careful analysis - e.g. by means of surveys and analysis of the demand for new skills of employers, and demand generated by other labour market programmes - so that they facilitate transition from unemployment to jobs in growth industries and occupations. In Jamaica, for example, labour market training programmes were designed for specific sectors of the economy, based on an assessment of their skill and training needs.³⁵;
• vocational training is combined with measures - wage subsidies, tax incentives, etc. - that encourage enterprises to take up young, older, unemployed workers;
• in the absence of effective demand for skills, labour market training focusses on developing general, portable skills that will enhance individuals' employability and job prospects when subsequent economic expansion is likely to boost the demand for labour. This labour market strategy has been pursued with some success in some Central European and in OECD countries, e.g. Sweden;
• measures to deal with the unemployed, displaced workers and other disadvantaged groups are negotiated and agreed upon by the parties concerned.

Older workers, either employed or unemployed, often face serious obstacles in accessing training programmes that would assist them in maintaining their jobs or find new employment. Employers often question their ability to learn new skills, despite ample evidence that these doubts are unfounded. As workers approach retirement age, employers are often reluctant to provide them with training. Lesser access to job-related training undermines their ability to remain employable while work requirements change. For those unemployed older workers who have marketable skills, job-search assistance and counselling programmes have proven invaluable in helping them finding a new job.

Japan, Canada, the U.K and the U.S. are among the relatively few countries that provide public training assistance and/or job search assistance to older workers. In Japan, several public employment and training programmes assist older workers to maintain their jobs. Subsidies are given to enterprises that have a specified proportion of older workers among their staff. The subsidies are given on the condition that older workers participate in public training programmes specially designed for them. However, these programmes are small scale and their labour market impact has not been evaluated. The United States and Canada conduct successful job placement activities targeted at older, low income workers, which include training or retraining of some kind. These activities are accompanied by counselling and are conducted mostly by non- profit organizations. Excellent placement rates have been achieved. In Canada, a federal C$30 million Older Worker Pilot Projects Initiative develops location specific solutions to issues of retention and re-employment of older workers. For example, a pilot project in Quebec province help older workers, who have worked in the ground fishing, forestry and paper industries, acquire the necessary skills to work in new occupations in the province. In the U.K., the Government has recently raised the maximum age of access to its "Training for Work" programme for the long-term unemployed from 59 to 63 years to help older workers maintain contact with the world of work.

Increasingly, many enterprises that have an aging workforce and face skill shortages and difficulties in recruiting younger workers recognize their older workers as a valuable resource. For example, British Airways recently found that some 50 per cent of staff were within 10 years of retirement. The company decided to provide flexible training to specific target groups, with older workers forming a key group. With the help of "learning to learn" packages older workers are given the tools to learn further specialist skills in aircraft engineering. Aerospatiale (France) has set up in-house training programmes designed for engineers and project supervisors, making particular efforts to adapt training content and methods to the needs of workers aged over 50. General Electric (USA) trains its 1,100 engineers and technicians, of whom about one third are aged 50 or older. Although classes are voluntary and in the employee's own time, participation is high because workers realize that updating their skills is essential for continued employment.

People with little education often face barriers when trying to enter a job for the first time, or a new job in the case of laid off, seasoned workers. Measures to help them overcome this handicap have been introduced in many countries. In Denmark, for example, as many as one million Danish workers were considered to be insufficiently literate for work and living in the knowledge-based economy. In 2000, adult basic education was restructured to become a transparent, credit-based and competence driven system. Also low skilled workers can now gain recognition for learning, training and competence at work. An example of a basic remedial education programme for adults is the adult literacy training programme organized by the Frontier College in Canada (see box 4.10).

People with disabilities

Disadvantaged groups are often blocked from entering employment by a range of inter-connected obstacles. Targeted, integrated packages of measures to promote labour market inclusion are more effective in tackling these obstacles than stand-alone training programmes focusing on specific skills. An example of a package of measures which aims to promote employment opportunities for people with disabilities is given below.

Youth unemployment is a complex issue in many countries, both developed and developing. Youth unemployment is an outcome of insufficient demand for labour in general, but is also due to a mismatch between young people's skills and the skills that employers demand. Hence, supported by efforts to boost aggregate labour demand, education and training institutions, and specific youth programmes, must persuade managers about the employability of young people and also provide young people with appropriate skills and experience. In the context of stagnating formal employment in many developing countries, training must provide skills that enable young people to become self-employed. These are formidable tasks in all countries, but there are some success stories.

A handful of countries, like Denmark, Germany and Switzerland have, as an integral feature of their training systems, formally linked education and initial training with employment, based on the needs of the labour market. The result has been to keep youth unemployment rates low and ensure a relatively smooth transition of young people from school to work. Also Japan has been successful in maintaining unemployment among young people at low levels. The system has maintained high levels of educational attainment generally and has managed to raise the scholastic achievement of low achievers. There are direct recruitment linkages between schools and employers, and employers provide training to young employees as part of their lifetime career development. Despite signs of erosion of the lifelong employment system in Japan, these institutions have so far managed extraordinarily well in keeping youth unemployment very low.

In contrast, developing countries often lack the formal institutions that would provide young people with the quality education and training needed for successful transition into the labour market. In these countries, stagnating formal sector employment has further exacerbated the youth unemployment problem. Both governments and NGOs have therefore supported programmes that promote self-employment, and employment in the informal economy, through both formal and non-formal education and labour market training. Out of this vast array of programmes, the Chile Joven Programme (1991-1999) has been particularly successful. It was designed to facilitate the labour market entry of young people at a time when many of their traditional employment opportunities were diminishing. Administered by SENCE (National Service for Training and Employment) and FOSIS (Solidarity and Social Insertion Fund) the programme provided employer-based, short-duration basic skills training for disadvantaged and unemployed youth. The training was tailored to meet local labour market needs. Evaluations of the programme suggest that participants (altogether more than 200,000) had better jobs and higher earnings after training than non-participants.

Training as Part of Anti-poverty Strategies

Women often constitute a large segment of low-income and vulnerable workers in many countries. They are often exposed to biassed, even discriminatory, practices that tend to perpetuate their economic and social exclusion. The two examples that follow illustrate the use of, respectively, targeted and universal policies to overcome their social and economic vulnerability. In the case of Chile, the activities of the Programme for Women Heads of Households (Programa de Asistencia a Mujeres Jefes de Hojar) were targeted at women living in poor socio-economic conditions. In Brazil, promoting training for women was part of a nation-wide training initiative, the PLANFOR. The initiative placed equal opportunities on the agenda of public training policies by incorporating excluded and vulnerable segments of the working population, not only as targets for policy, but as actors in defining and executing these polices.

In Chile, five lines of parallel, yet complementary, action were pursued: training, childcare, housing, health and legal assistance. These activities were concentrated among the most vulnerable groups of women and in areas were poverty was most widespread. The women were encouraged to participate in designing and executing these policies and programmes that mobilized both public and private resources at local, regional and national levels. The programme was particularly successful in advancing the process of decentralisation, in breaking labour market segmentation, and developing training materials that incorporate a gender perspective. The programme also successfully promoted women's personal development and life skills, including improvement of their self-esteem and ability to plan for life. However, technical training was found to have less impact in improving women's labour market insertion. The result is not surprising, given these women's highly disadvantaged socio-economic status in Chilean society³⁷.

In Brazil, PLANFOR pursued three primary sets of activities: articulated action with various social, economic and political actors in vocational education and training; conceptual advances in designing and delivering training; and support to civil society through these innovative experiences. PLANFOR achieved considerable success. In1995-99 it reportedly trained 8.3 million participants, at a cost of some $700 million, covering some 70 per cent of the 5.500 municipalities in the country and 75 per cent of those that have heavy concentrations of poverty. Some 1500 providers, including universities, trade unions, vocational education and training institutions and providers, enterprises and NGOs participated in the programme. Women were the largest group of beneficiaries, increasing from 41 per cent in 1996 to 49 per cent in 1999, representing altogether nearly 4 million women. Like in Chile, evaluations were not able to assess the true impact on women's labour market insertion, but identified a significant rise in their personal skills, self-esteem, integration into new networks of support, and perceptions of improved opportunities for self-employment³⁸.

Community-Based Training (CBT) and Community-Based Rehabilitation (CBR), developed by the ILO, have been introduced in many developing and transition countries to meet, specifically, the training and skill development needs of poor people in rural areas, including those with disabilities. CBT programmes provide training linked to specific, pre-identified income-generating activities and a systematic community-based approach to training delivery. CBT also facilitates the necessary post-training support services, including credit, to ensure that individuals or groups can initiate and sustain the income-generating activity for which training was provided. Training is provided for people with disabilities using a similar approach to CBT. In addition to skills training and training in business development, community-based rehabilitation includes provision for health, education and income-generation support services. Box 4.12 illustrates the approach taken in Belarus.

In Ireland, the National Anti-Poverty Strategy (NAPS) was introduced in 1997 to put poverty and social exclusion at the top of the Irish national agenda. The NAPS strategic aim is to tackle issues of educational disadvantage, income insufficiency, the disadvantaged in urban areas and rural poverty. In order to achieve those aims, the NAPS has to ensure access and participation for all, develop a partnership approach among national and local stakeholders, encourage self-reliance and empowerment and develop appropriate consultative processes with users of services. At the coordinating and monitoring level, the Combat Poverty Agency (CPA) evaluates, supports and advises individual government departments and regional structures on the development of anti-poverty strategies. It also engages in research, raises public awareness about poverty and supports innovative community development and anti-poverty projects. One of the successes of the NAPS and CPA is the Educational Disadvantage Project (EDP). It aims to reduce the number of early drop-outs among young persons from the formal education system. An experiment in Dundalk found that the district-based consortium approach to tackling educational disadvantage was crucial in reducing early dropping out from school, changing attitudes and creating a broader understanding and perspectives among all participants. By targeting young people at the right time, 'labelling' did not occur. The partnership between the education sector and CPA contributed to reducing the number of students leaving school early³⁹.

5. Qualifications Frameworks for Learning and Training for Work

Countries, enterprises and individuals need new systems, or frameworks, for assessing, recognising and certifying competencies and skills. Several concurrent developments have generated an intense debate about qualifications frameworks. These developments include education and training system reforms for lifelong learning; the growth of enterprise/institution partnerships in training and the proliferation of training providers; the growing incidence of workplace learning; active labour market polices that emphasize training and guidance; growing mobility in the labour market; and enterprises' efforts to improve productivity and competitiveness through better human resource and competency management.

"The development of a national qualifications framework is in the interest of enterprises and workers as it facilitates lifelong learning, helps enterprises and employment agencies match skill demand with supply, and guides individuals in their choice of training and career" (Conclusions, para..17). It also contributes to accumulation of human capital and an economy's competitiveness.

Competency Standards, Assessment and Recognition and Certification

Qualification frameworks generally consist of a three major elements. Firstly they are based on "appropriate, transferable, broad and industry-based and professional competency standards, established by the social partners, that reflect the skills required in the economy and public institutions, and vocational and academic qualifications". Secondly, they incorporate "a credible, fair and transparent system of assessment of skills learned and competencies gained, irrespective of how and where they have been learned, e.g. through formal and non-formal education and training, work experience and on-the-job learning". Thirdly, they "include a system of certification of skills that are portable and recognized across enterprises, sectors, industries and educational institutions, whether public or private"⁴⁰.

Competency standards - based on sound labour and work analysis, and engaging the social partners - are an essential link between workplace employment requirements and systems and programmes of learning, education and training. They can guide continuou