JEDDAH – Education has long been recognized as an area of relative weakness in the GCC, although the picture has never been uniform across the region, the National Commercial Bank said in its latest GCC Economic Review. It noted that various initiatives in recent years have made significant headway in addressing the demand of the labor market, citing a number of impressive new university and college projects, new schools, and curricula review to tackle the market needs. Yet, international comparisons of educational standards still make for relatively unflattering reading for the region, it added. For instance UNESCO's Education for All Development Index in its latest 2007 review placed the three GCC countries it ranks at just above the middle of the 128 jurisdictions reviewed. The UAE is ranked 52nd, Kuwait 53rd, and Bahrain 54th. Even as education overall remains a key fiscal priority, vocational training in particular is increasingly recognized as an area requiring more attention. This likely to prove critical for substantially boosting the numbers of people placed in the labor market given the numerical dominance of jobs that require non-academic skills and qualifications anywhere in the world. For instance, while Saudi Arabia spends some 6.9 percent of its GDP on education, a figure ahead of the OECD average, spending on technical and vocational training is some 70 percent below the global benchmarks. Only 9 percent of Saudi youth today graduate with a vocational qualification as compared to an OECD average of 45 percent. The proportion in the other GCC countries is even lower with Bahrain the only exception as 24 percent upper secondary students were in vocation and technical training as of 2009. In response to these realities, the Saudi government is supporting public-private partnerships so as to increase the capacity of vocational training from 10,000 to 200,000 over the coming decade. At the same time, regional policy makers are taking steps to formally define competencies and develop a targeted plan for meeting them. For instance in the UAE, local colleges and the National Institute of Vocational education are tackling the task with the assistance of foreign colleges. Apart from imparting formal knowledge and skills, education has other positive roles to play in enhancing labor market efficiency. In particular, general awareness of the labor market, and career planning can - and ought to - be effectively communicated as part of educational curricula. It is essential to ensure that all schools have access to professional career counselors and that career fairs are organized on a systematic, open-access basis. Starting the process early enables students to plan their careers based on informed assumptions. Recent labor market initiatives in the GCC have paid unprecedented attention to these factors. For instance, the UAE Ministry of Education last year announced plans to appoint specialist career counselors in all government high schools in Dubai and the Northern Emirates by 2015. UAE law is being revised to require school attendance past the age 14 until Grade 12. Linked to this, steps are needed to foster workplace exposure through education and internships. The increased use of the Internet is boosting access to labor market information and organized career days are becoming more common across the region. In Saudi Arabia, more than 10,000 people, almost three-quarters of them women, had by April registered in the Liqaat program which is designed to more effectively bridge the gap between employers and job-seekers through a website and events such as career fairs and exhibitions. The report noted though that beyond labor market awareness building, the GCC region faces a number of specific needs in the area of education: • Remedial education and training. The mismatches between the skills of job seekers and the needs of the labor market can in many cases be overcome or at least meaningfully mitigated through focused programs that are limited in duration and cost. Where concrete labor market needs exist, focused spending on relevant diploma and certificate programs can yield significant net returns while bringing more of the local population into the active labor force • Ongoing education. In a rapidly changing global economic and technological environment, formal learning can quickly become outdated. Creating mechanisms for ongoing further education is important for skill updates, upgrades, and motivational reasons. The most competitive knowledge economies globally owe part of their prowess to their ability to enhance employee skills and encourage productivity on an ongoing basis • On-the-job training. Some of the most valuable skills are acquired at work rather than at school. Moreover, many companies have procedures and cultures that are specific to them. Since especially the regional private sector has a long history of importing skills "off the shelf," on-the-job training tends to be relatively underdeveloped. Ultimately, however, it, more than anything, remains the necessary "glue" that links raw human capital to the requirements of the workplace. After all, fresh graduates of educational institutions cannot be expected to fit in naturally at a workplace. In many countries this alignment is formalized under apprenticeship programs which are gaining growing attention also in the GCC. Moreover, the report said as much as policy can hope to address attitudes and overcome weaknesses in skills and qualifications, economic decisions are to a large extent based on purely financial considerations. The employment of nationals in the private sector has historically suffered because of far higher public sector salaries and the reality that private sector compensation in many cases is not sufficient to support a family. Employers have met their needs by importing low-cost expatriate labor with a minimal cost of living. The economic rationale of such jobs has come from the relatively higher purchasing power of the workers earnings in their home countries. Addressing these disparities is likely to be a necessary precondition for boosting national employment, the report noted. – SG
