This column part of The Globe's Wealth Paradox series – a 10-day in-depth examination of our growing income inequality and the best ideas available for improving upward mobility for all.
The latest Skills Outlook report from the Organization for Economic Co-operation and Development paints a complex picture of how well countries are preparing their populations for today's evolving economies and the rapid, sometimes jarring, pace of technological change. On conventional measures, such as the proportion of the population with post-secondary education, Canada is at the top of the OECD rankings, and we score highly on standardized tests of student performance in reading, science and math. So all is well?
Complacency should not be the takeaway for Canadians. In labour market outcomes, the youth unemployment rate in Canada is double the overall unemployment rate, and many graduates are encountering a gap between their work and compensation expectations and the reality of today's job market. In proficiency in numeracy and literacy among 16-24 year-olds, both essential for all sectors of the knowledge-based economy, Canada is lagging the results for the Nordic countries, Australia and Germany. In preparing young Canadians for work that will be constantly changing, experiential education appears to be quite valuable, especially for the skilled trades, and here there may be much to learn from others.
Consider Germany and its model of a dual vocational training system. While many reasons are advanced for why Germany has the strongest growth, best innovation performance and one of the lowest youth unemployment rates in Europe (around 8 per cent), Germany's dynamic labour minister, Ursula von der Leyen, points emphatically to the role of education, and particularly the dual vocational system which combines apprenticeships with formal schooling, as key to this success. Employers equally laud its role in preparing skilled workers, with both practical experience and specialized knowledge from continuously updated formal courses. And this focus on skilled trades certainly seems to be having an impact as Germany is the only G7 country where the manufacturing sector has not been significantly hollowed out in recent decades.
So how does the system work? It is a partnership model, at many levels. It is enshrined in government legislation (both federal and state), there is widespread business buy in, with active participation from chambers of commerce and business associations to ensure that work and teaching are matched, the vocational training institutions are crucial partners and tailor their courses to the required occupational skills, and there is public validation of the value of the skilled trades as an occupation. Both governments and business contribute to funding the system, since both benefit from a well trained work force. Impressively, half of young Germans enter vocational training after high school, and a majority of these are now in the dual system.
There are now 348 occupations, relevant to all sectors of the economy, as part of the dual vocational system. There are formal regulations governing the skills required for the designated occupations and the nature of the training plan: what is required of each business, the vocational school, the apprentice, the specific training for each occupation and the examination requirements. Apprentices typically spend three to four days at week training in the business and one to two days learning at school, following a program that lasts about three years depending on the occupation.
What can we learn from the dual vocational system, are there downsides and how replicable is it? The advantages for the apprentices are a recognized occupational certificate, practical work-related experience, income while training and very good prospects in the job market. For business, there is structured input into the skills needed for each occupation, a large pool of skilled and experienced workers fresh out of their dual vocational training programs, and an opportunity to see how different apprentices match with a company's culture and vice versa. The main concerns are whether the dual vocational system encourages a culture of lifelong learning as skill needs change and its flexibility to allow shifting into a pure academic stream along the way.
As the Report of the Jobs and Prosperity Council underscored, we have to do a better job at developing skilled trades in Canada if we are to strengthen the competitiveness of our manufacturing and resource sectors. So the question is less whether and more how. University co-op programs, such as those at the University of Waterloo which are the world's largest, have similar elements of partnership between the institution, the firm and the student, and there is much scope to expand such experiential learning at the university level in Canada. But a key element of the German system is its recognition that one size does not fit all, and there are strong advantages to a dual vocational system that not only trains and educates skilled trades, but professionalizes and validates them. We have good public education in Canada; a more structured approach to the skilled trades utilizing aspects of the dual vocational system would make it better.
Kevin G Lynch is vice-chair of BMO Financial Group