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This report was presented to the Working Party on the Information Economy (WPIE) in December 2004. It provides an overview of information and communications technology (ICT) skills and employment across OECD economies and analyses some of the impacts on economic performance. It describes a new approach to identifying the diffusion of ICTs in the economy. Two measures of ICT-skilled employment are developed. The first is a narrow measure that uses occupational data to identify ICT specialists (e.g. programmers, software developers but also cable layers). The second is a broad measure that includes those who intensively use ICTs to perform their work (both basic and advanced intensive users), as well as the specialists. These measures are calculated for the economy as a whole and also by sector. The report provides a brief review of earlier attempts to identify the presence of ICTs in the economy and describes a new measurement approach developed for the 2004 ‘OECD information technology outlook’, which attempts to capture the diffusion of ICTs throughout the economy based on the degree of their actual use. The industry rankings based on the share of ICT-skilled employment in total employment are then compared to the results of other studies that classify industrial sectors on the basis of ICT usage. Some preliminary results from the analysis relating the ICT skills measures to productivity measures are presented. The report has expanded the analysis of ICT-skilled employment from the 2004 ‘OECD information technology outlook’ and extended it to include Canada. The analysis revealed that the narrow measure of ICT specialists followed a similar pattern across countries (European Union (EU)15, US, Canada and Australia), but that the trends for broad measure of ICT-intensive users and specialists diverged. The share of broad ICTskilled employment is increasing in the EU15, but decreasing in the US, Canada and Australia. The broad ICT-skilled employment measure was also analysed at the sectoral level. Findings reveal that many business services sectors have a very large share of ICT-skilled employment (e.g. computer and related services, financial intermediation services, and research and development), as well as certain manufacturing sectors (such as manufacturing of office machinery and computers). Personal services tended to have a relatively low share. Most sectors were found to have increased their share of ICT-skilled employment somewhat, particularly those that already had a relatively large share. Show less

Dual apprenticeship training is a market-driven form of education at the upper secondary level, taking place in firms as well as in vocational schools. So far, little is known about the impact of the business cycle on the number of apprenticeship programs offered by firms. Using panel-data of Swiss cantons from 1988-2004, we find that the influence of the business cycle is statistically significant, but small in size. Instead, supply of apprenticeship programs is driven to a much greater extent by demographic change. Conversely, the number of first-year high school students is not affected by the business cycle. We find, however, that enrollment increases if the population at age 16 grows, but access to high schools does not become more restricted in times of negative growth.

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The demand and supply of tertiary workers contribute to shaping their earnings advantage. The expansion of tertiary education has been accompanied by a decrease in the earnings advantage of tertiary-educated younger and older workers in many OECD and partner countries. Tertiary-educated workers reap the largest advantage in countries where few adults have completed tertiary education, such as Brazil, Costa Rica, Colombia and Mexico. Tertiary-educated workers with high literacy skills have considerably higher earnings than tertiary-educated workers with lower skills. Older tertiary-educated workers benefit from both their relative scarcity among their generation and their longer professional experience, resulting in a higher earning advantage than their younger counterparts. It is difficult to say whether younger tertiary educated workers will achieve the same earnings advantage over time that the older generation currently enjoys. However, a formal qualification is not the sole assurance of higher earnings: higher skills lead to positive financial outcomes across all educational attainment levels.

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This study attempts to explain why the transition to a market economy is skill-biased. It shows unequivocal evidence on increased skill wage premium and supply of skills in transition economies. It examines whether similar skill-favouring shifts in the Russian and US economies are driven by the same set of factors. [The] analysis elaborates on the model of alternative theories of the increased wage skill premium and then evaluates three main hypotheses: skill-biased technological change, the market adjustment hypothesis, and the institutional factor hypothesis. To test these hypotheses, the study uses unique linked employer-employee data that spans the 16 years of the Soviet and transition periods in Russia (1985-2000), with a special emphasis on data quality, measurement errors, and retrospective biases. The main conclusion is that there is no uni-causal and time-invariant explanation for skill-biased changes in wages and employment in the Russian economy. The increased skill wage premium has been driven mainly by institutional factors during the early period and by productivity and technological change during the late transition period, and reinforced by market adjustment of wage ratio to the true differences in labour productivity.

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We examine the dynamic role of education and experience as determinants of wages. It is hypothesised that an employee’s education is an important signal to the employer initially. Over time, the returns to schooling should decrease with labour market experience and increase with initially unobserved ability, since the employer gradually obtains better information on the productivity of an employee. Replicating US studies using data from a large German panel data set (GSOEP), we find no evidence for the employer learning hypothesis for Germany. Differentiating blue-collar and white-collar workers and estimating quantile regressions, however, leads to the conclusion that employer learning takes place for blue-collar workers at the lower end of the wage distribution. We further show, that information on the productivity of an employee is to a large extend private.

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The OECD annual report on jobs and employment in OECD countries reviews recent trends, policy developments, and prospects. The 2021 edition of the OECD Employment Outlook [available in VOCEDplus at TD/TNC 145.163] focusses on the labour market implications of the [Coronavirus Disease 2019] COVID-19 crisis. Country notes are available for Australia, Canada, France, Germany, Italy, Japan, Korea, Mexico, Spain, the United Kingdom, and the United States.

In some countries, employers used job retention programmes to cut hours while allowing workers to keep their pay and jobs; there, it is likely that the full impact of the pandemic is yet to be felt. In others, there have been unprecedented increases in unemployment, but many workers will return to their jobs (or to new ones) as economies re-open and activity picks up.

The initial impact of the COVID-19 crisis was relatively modest in Korea due to the fast and widespread campaign of test, tracking and tracing that contributed to contain the spread of the virus. The unemployment rate in Korea started to rise from 3.4 per cent in February 2020 and reached 5.4 per cent in January 2021 due to enhanced distancing measures at the end of 2020. After that, it gradually declined to 3.8 per cent by May 2021. In Korea, the COVID-19 pandemic has had a greater impact on vulnerable groups, such as non-regular workers and young people. In 2020, the number of temporary and daily workers decreased by 6.5 per cent and 7.1 per cent respectively, while the number of regular workers increased by 2.1 per cent. The employment rate for young people (aged 15-29) also fell in 2020 by 1.3 percentage points compared to the previous year, showing the largest decline among all age groups.

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We analyze empirically the effects of urban agglomeration on Italian college graduates' work possibilities as entrepreneurs three years after graduation. We find that each 100,000 inhabitant-increase in the size of the individual's province of work reduces the chances of being an entrepreneur by 0.2-0.3 per cent. This result holds after controlling for regional fixed effects and is robust to instrumenting urbanization. Province's competition, urban amenities and dis-amenities, cost of labor, earning differentials between employees and self-employed workers, unemployment rates and value added per capita account for 40 per cent of the negative urbanization penalty. Our result cannot be explained by the presence of negative large-city differentials in returns to education either. In fact, as long as they succeed in entering the largest markets, young entrepreneurs are able to reap-off the benefits of urbanization externalities: every 100,000-inhabitant increase in the province's population raises entrepreneurs' net monthly income by 0.2-0.3 per cent.

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Impressive progress has been made in raising participation in early childhood education as well as tertiary educational attainment over the past 30 years. However, the inflow of poorly educated youth into the labour market is unusually heavy for a high-income country, largely on account of high drop-out rates in lower secondary education which, in turn, reflect one of the highest grade repetition rates in the OECD. The supply of workers with intermediate vocational skills is surprisingly low, despite the high return, in terms of labour market outcomes that these skills offer, even if they have recently deteriorated. There is room to raise learning outcomes up to the end of compulsory school, as measured by the Programme for International Student Assessment (PISA), although, owing to a compressed distribution of such outcomes, the share of poorly performing pupils is not unusually large. While significant reforms have been undertaken to address these problems, more measures are needed to reduce grade repetition and raise education outcomes, by improving accountability of schools and school staff, as well as by raising school autonomy further than has already occurred. Vocational training needs to become more attractive. In tertiary education, few Spanish universities have attained a high level of international standing, and scope remains to improve the contribution tertiary attainment can make to gains in economic welfare, notably by reforming funding arrangements.

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One problem with the theory of firm-specific human capital is that it is difficult to generate convincing examples of investment that could generate the sometimes observed large and continuing effects on earnings. Another approach, called the ‘skill-weights’ view, allows all skills to be general in that there are other firms that use each of the skills. But firms use them in different combinations and with different weights attached to them. The skill-weights view not only has aesthetic appeal, but is consistent with the frequently observed large tenure effects. All of the implications of the traditional view are produced by this approach, and there are a number of other implications that distinguish the new view from the traditional one. The empirical evidence already contains some support for the skill-weights view.

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Economic and cultural globalisation has ushered in a new era in higher education. Higher education was always more internationally open than most sectors because of its immersion in knowledge, which never showed much respect for juridical boundaries. In global knowledge economies, higher education institutions are more important than ever as mediums for a wide range of cross-border relationships and continuous global flows of people, information, knowledge, technologies, products and financial capital. Even as they share in the reinvention of the world around them, higher education institutions, and the policies that produce and support them, are also being reinvented. For the first time in history every research university is part of a single world-wide network and the world leaders in the field have an unprecedented global visibility and power. Research is more internationalised than before and the mobility of doctoral students and faculty has increased. The specifically global element in academic labour markets has gained weight, especially since the advent of global university rankings. This working paper explores the issues for national policy and for individual institutions. Part one provides an overview of globalisation and higher education and the global responses of national systems and individual institutions of higher education. Part two is focused on certain areas of policy with a strong multilateral dimension: Europeanisation, institutional rankings and typologies and cross-border mobility.

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