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Aligning education policy with labour market demand

Farzana Munshi | November 12, 2023 00:00:00

Accumulation of human capital by investing in education, training and other forms of learning has been considered as a critical source of economic growth by many economists including Nobel laureates Gary S. Becker, Paul Romer and William Nordhaus. Appropriate education and training provide an individual the necessary knowledge and skills to become relevant for the labour market and meet the demand which increases his/her employability and earnings. Much of the earnings gap within and across countries can be explained by human capital differences. Thus, alignment of an education policy with the market demand is an extremely important issue on the agenda for overall development of a nation.

The Fourth Industrial Revolution, like the previous industrial revolutions, has instigated another round of "creative destruction" in the global job market by destructing many low-skilled, repetitive and physically demanding jobs and creating new jobs related to technological advancement. This implies that the routine or 'codifiable' jobs are being continuously replaced by machines and robots, resulting in a further shift in the production process from labour-intensive to knowledge and skill-intensive technology. Essentially the entire systems of production, management, and governance are going through a massive transformation with the convergence of artificial intelligence (AI), the internet of things (IoT), robotics, and blockchain. The rate of this transformation has never been faster, and is reshaping the business models and thus demanding new skill-sets. It is almost certain that the pattern of future jobs, say in twenty years, is uncertain and many children enrolled in elementary schools currently will hold jobs in future that do not currently exist.

As robotics technologies are becoming more advanced as well as affordable, their use in industries (such as healthcare, electronics, agriculture, manufacturing, logistics, etc.) is becoming widespread across the countries. According to the 2021 World Robot Report, the average of global robot density in the manufacturing industries almost doubled in the last five years--126 robots per 10,000 employees in 2020 from 66 units in 2015. As a reality, humans will work in parallel to robots at workplaces, at home and do other activities such as transportation and entertainment. This implies that understanding technological know-how will be an important part of skill development soon. A gig economy will most likely become common, as organisations will prefer hiring temporary workers or freelancers with specific skills for the short term. Accordingly, future employers will value both higher-order cognitive (technical) skills and socio-behavioural skills, as these skills improve the adaptability of workers and allow them to switch easily from one job to another. This implies that early childhood foundation of education will be extremely important in a society as cognitive and behavioural skills mostly develop in pre-primary and primary stages which help them become life-long learners. To sum up, skills such as problem-solving, critical thinking, creativity, emotional intelligence and cognitive flexibility will be in high demand in the future job market.

The education system of Bangladesh has made significant progress over the years in terms of increase in access to education and literacy rates. However, the majority of the labour force (70.5 per cent in 2022) have only primary education. The Labour Force Survey (LFS) 2022 says that only 1.46 per cent of the labour force received vocational training in the past twelve months preceding the survey. Reliance on comparative advantage of un- and low-skilled workers served well in the last four decades of structural transformation process--from agrarian to industrial and service-based economy and graduation to a lower-middle-income country status in 2015. However, future (and current) decades will require a higher level of skills not just for preparedness for the fourth industrial revolution but also for achieving the upper middle-income country status by 2031 and the high income status by 2041 as envisaged in the country's development goals. Utilising the demographic 'dividend' with an appropriate education policy will play a critical role in this context. Nonetheless concerns remain regarding relevance of the current education policy for the future labour market demand.

There are different education streams in Bangladesh--Bangla medium, English version, English medium and Madrasa (the religious stream). Bangla medium and English version schools have three levels--primary (grades 1 to 5), secondary (grades 6 to 10), higher secondary (grades 11 to 12) and they follow the same curriculum. [English version follows same textbooks as Bangla medium, translated into English.] Primary education is compulsory and majority of the students study in Bangla medium schools. English medium schools mostly follow the Edexcel or Cambridge of UK curriculum with few following IB (international baccalaureate) curriculum. Madrasa education comprises both registered (Aliya) and non-registered (Qawmi) streams. Aliyah madrasas have three levels: Ebtedayee (primary equivalence), Dakhil (secondary equivalence), Alim (higher secondary equivalence). Aliya madrasa and majority of the Bangla medium schools are state-sponsored. English medium schools and Qawmi madrasas are privately sponsored. Studying at English medium schools are quite expensive while studying at Qawmi madrasas are almost free. In addition to education, Qawmi madrasas provide free food and accommodation and house many orphans and students from poor families. The madrasa stream, particularly the Qawmi stream, stresses more the religious subjects instead of science and technical subjects. The employability of graduates from this stream is likely to decline in near future with the technological advancement.

Most key indicators of the primary, secondary and higher secondary education in Bangladesh show a positive trend. The number of primary schools including public, private, madrasa and NGO-run ones increased significantly in recent years. The number of teachers has also increased including the proportion of trained teachers. Free textbooks, monthly stipend for mothers of primary school students and National School Meal Policy helped reduce dropout and repetition rates. The most recent government statistics reveal that, in 2022, the gross enrolment ratio was 110.48 per cent and 76.10 per cent for primary and secondary education respectively. Importantly, girls' enrolment ratio is higher than boys', thanks to the different stipend programmes for girls. However, dropout rates are much higher in secondary education (35.98 per cent) than in the primary (13.95 per cent) or higher secondary education (22.72 per cent) and the girls' dropout rate is almost triple (40.78) in secondary education compared to primary education (13.19). Absenteeism, both for students and teachers, is a common practice at both primary and secondary levels. The most important challenge, however, is the learning outcome. As is well known, foundational skills like literacy and numeracy are developed at the primary level which helps students develop cognitive and socio-behavioural skills at this early age. At the secondary level students acquire the fundamental skills such as communication and problem-solving, which are essential for developing specialized skills at the tertiary level. Studies have shown that many Bangladeshi students graduate from secondary schools without learning these basic skills. Another alarming trend in secondary and higher secondary education is the decreasing rate of enrolment in the science stream, although the future job market will necessitate an increasing number of STEM graduates. In 2022, only 29.16 per cent and 17.97 per cent students were enrolled in the science stream at the secondary and higher secondary levels respectively compared to 54.41 per cent and 62.77 per cent in humanities. Science subjects are relatively difficult, particularly for the weak primary graduates, and require additional tutoring which many students cannot afford. In addition, there is a lack of qualified science teachers. Poor foundation affects the overall quality of education, particularly learning, at the tertiary level and consequently job-readiness of the graduates. Introduction of pre-vocational and vocational courses at the secondary and higher secondary levels are expected to improve the labour market relevance.

The tertiary level has three broad categories: universities, colleges operating under general education system and polytechnique institutes operating under the TVET system. Over the last decade the number of universities almost doubled, accommodating more than 1.0 million university students in 2022 implying greater demand for higher education. Despite this achievement, access to tertiary education is rather limited; the gross enrolment ratio was only 18.66 per cent in 2022. Lack of quality education, teaching and learning approach, outdated curriculum, lack of infrastructure, particularly digital infrastructure, and weak industry-academia linkage are other major challenges the tertiary level of education is currently experiencing.

Globally various trainings programmes offered by TVET institutions have been found to be an effective way of creating a skilled workforce to cater to the market demand. In Bangladesh, however, TVET is undervalued by society and university education is more preferred. The common perception is that students who do not get admission in general stream education end up in TVET institutes. However, this perception is changing slowly. The number of TVET institutes and student enrolment more than doubled between 2012 and 2022. The system offers an alternative opportunity to those who could not complete formal education due to personal and financial reasons. Various public and private engineering colleges, polytechnic institutes, technical schools and colleges, technical teachers' training colleges, vocational teachers' training institutes, business management colleges and similar technical and vocational institutes are offering various skill-development programmes of different durations. Nevertheless, like the general stream of education, TVET also faces several challenges including lack of access and quality education and low female participation.

The heterogeneous education system in Bangladesh produces graduates with different skill-sets. Poor marketable-skills and lack of job-readiness create a skill mismatch in the labour market resulting in high graduate unemployment (12per cent in 2022), prolonged joblessness and employers' reliance on foreign nationals to fill the local skill gap. Only a small proportion of the demand for skilled workers is currently met with the local resources in the expanding sectors such as RMG, construction, leather and shipping.

Upgradation of skill-sets will require improving the quality of education at all levels--pre-primary to tertiary and TVET institutes. The current state of the nation's development, especially in light of continuous integration of the economy as well as emergence of the fourth industrial revolution, requires more STEM graduates than ever. An adequate availability of workers with the right skills including digital, commercial and management expertise will be critical for preparedness for the emerging future jobs. A strong public-private partnership may be an effective strategy for quality improvement at all levels of education. Creating a workforce with skills required by the economy and the labour markets in an increasingly globalized world should be given a well-thought-out focus in the education policy and be considered as a top priority on the development agenda.

Farzana Munshi is a Professor of Economics at Brac University and a Professorial Research Fellow at the Global Development Institute, University of Manchester, UK.

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