Chapter 4. Towards an action plan for jobs in Poland: Recommendations and best practices
Stimulating job creation at the local level requires integrated actions across employment, training, and economic development portfolios. Co-ordinated place-based policies can help workers find suitable jobs, while also contributing to demand by stimulating productivity. This requires policies which can be catered to the local level, up-to-date and accurate data, and integrated partnerships which leverage the efforts of stakeholders. This chapter outlines the key recommendations emerging from the review of local job creation policies in Poland.
Better aligning programmes and policies to local economic development
Recommendation: Carefully monitor the new PES reforms and adjust as necessary to prevent unintended consequences
The 2014 reform of public employment services described in Chapter 2 represents important progress. Like many countries across the OECD, Poland has taken steps to strengthen its performance management systems, including creating stronger incentives for local PES offices to meet the key performance measures defined at the national level. At the same time, these reforms will need to be carefully monitored to identify and avert any unintended negative consequences. While this recommendation focuses specifically on the performance management system for PES offices themselves, many of the same issues are relevant for the payment-by-results contracts of contracted providers. Other issues related to the new mechanism of profiling are addressed in a separate recommendation.
In particular, two areas raise concerns. Given the increased emphasis and incentives put in place to meet performance management objectives, there is a risk of poviat labour offices “gaming” the system to inflate performance measures through methods such as “creaming” (only serving the most employable clients) or other types of “creative accounting”. This system may also encourage PES offices to rapidly place clients into jobs, even if these jobs are a bad skills match or of low quality. While the latter may technically meet the performance indicator requirements, it can undermine the productive potential of local economies, as it promotes poor quality jobs and skills mismatches. Some of these challenges could be partially eliminated by more sophisticated methods of measuring the effects of active labour market policies, such as:
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Extending the period for which effectiveness is measured (to six months and 12 months);
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Delegating the task of measuring the effects of poviat labour offices to an independent body; or
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Measuring the net effects of active labour market policies on the basis of data from the IT systems of employment offices and social insurance data (an experimental measurement using these sources was already conducted by the Chancellery of the Prime Minister).
The other key concern is that the current performance management system allows for no adaptation or tailoring to local circumstances in terms of broader economic and labour market characteristics or specificities of the clients served. Across the OECD, many PESs measure local inputs and outputs as part of performance management, but few actually use detailed information on jobseeker characteristics and local labour markets as recommended by the OECD (OECD, 2015). Such practices can help to ensure that local labour offices are being measured using a fair yardstick, while reducing the incentives for creaming (in the case where performance measures are adjusted for types of clients served). Performance management systems in the United States, Australia, Germany and Switzerland have incorporated these practices. The German and Swiss models are described in more detail in the textbox below.
Germany: using benchmarking and negotiation to identify local targets. In Germany, setting performance targets is somewhat of an iterative process involving national, regional and local tier of governance, with social partners involved throughout. At the federal level, a Board of Governors with tripartite representation works with the government to jointly appoint a three person management board responsible for the operational management of the PES (Bundesagentur für Arbeit). This national tier develops broad targets and sometimes binding operational guidelines, which are handed down to the regional (Lander) tier of management. Local agencies, in turn, make proposals to the regional tiers about their expected level of performance. The regional directors then scrutinise and aggregate these targets, before sending a proposal back to the national tier. Consensus is reached through discussions between the national and regional tier. Evidence suggests that this negotiation process is fully used, with examples of regional and local requests for lower performance targets both being accepted and rejected at the regional and national level.
Additionally, the Institute of Employment Research of the Federal Employment Agency has used advanced statistical modelling to cluster local labour markets into 12 comparable groups to help benchmark and motivate performance. In discussions with PES, key labour market indicators were selected, and regression analysis was used to identify their key determinants. Cluster analysis was then used to sort groups that are similar in terms of the key determinants, allowing for comparisons of “likes and likes”. Examples of these groups include rural areas with a good labour market situation and strong seasonal dynamics, areas with SME structure and good labour market situation, areas mainly characterised by big cities with moderately high unemployment, etc. (See Blien et al 2010 for more detail). The highest performing agencies in each cluster serve as a benchmark the others in that cluster try to reach.
Switzerland: using regressions to adjust performance measurement to local conditions. In 2000, Switzerland introduced a system for rating local performance in terms of off-benefit outcomes. Using a rich array of information on job‐seeker characteristics from the PES administrative database as well as survey-based information about local labour markets, the Ministry uses regression-adjusted formulas to publish comparative ratings of local office performance. There are four regularly monitored primary indicators of PES performance which are assigned different weights:
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Speed of reintegration of the unemployed into the labour market, as measured by the average duration of unemployment benefit entitlement per unemployed (weighted 50%).
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Prevention of long-term unemployment, as measured by the share of those remaining unemployed among those who were registered as unemployment benefit recipients 13 months before (weighted 20%).
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Prevention of benefit exhaustion, as measured by the share of unemployed no longer entitled to federal unemployment benefits in the total number of unemployed (weighted 20%).
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Prevention of repeated registration for benefit, as measured by the share of previous unemployed who have de-registered but re-apply for unemployment benefits within four months (weighted 10%).
While initially, this rating was intended to be feed into federal PES funding formulas to the cantons, this link was terminated after criticism from the cantons. Instead, the system functions by providing offices performance data in order to better manage their own offices; through “naming and shaming” and peer pressure; and the possibility of an in-depth evaluation undertaken by the ministry should offices repeatedly underperform. However, this system is not without its challenges. Using exits from UI, rather than proven entry to a job, as the outcome measure means that outcomes for people without a UI entitlement are not taken into account. Therefore, all else being equal, focusing on reducing the number of UI recipients will result in a higher rating than priortising social assistance beneficiaries.
Source: OECD (2015), OECD Employment Outlook 2015; Blien, U., F. Hirschenauer and P. thi Hong Van (2010), “Classification of Regional Labour Markets for Purposes of Labour Market Policy”, Papers in Regional Science, Vol. 9, No. 4, November. European Commission (2013), Review of Performance Management in Public Employment Services, Brussels, Author: Alex Nunn. European Commission (2012), Performance management in Public Employment Services, Brussels, Author: Alex Nunn.
Recommendation: Improve local co-ordination of employment and skills policies and programmes
At the local level, a number of actors work on skills and labour market policy, including poviat labour offices, NGOs, private training institutions, VET, local social assistance institutions, universities, and there is a need to strengthen co-operation between all these actors. Past OECD research has highlighted the important role that strong local governance boards can play in bringing together key stakeholders in steering the provision of skills and/or employment policy locally. The existence of local labour market councils, which bring together representatives of employer’s organisations, trade unions, and NGOs, are already a step in this direction. However, a combination of low capacity and relatively little statutory authority beyond an advisory role limits the strategic role they play in practice. Concerns were also raised about potential conflicts of interest for labour market councils in smaller poviats.
Combining and coordinating the efforts of all actors acting at the local level could take the form of a local partnership, local platform for skills or local skills councils. In the case of larger local labour markets (such as Radom or Poznań), this could also include some sectoral councils. Such structures could serve as a mechanism to develop local sectoral strategies and ensure that the investments in skills are adjusted to local needs. In the past, there have been some initiatives targeted toward building local partnerships. However, a significant number of them have not succeeded. In order to avoid the risk of creating artificial partnerships, it is better to adopt a step by step approach – building smaller partnerships at the beginning, focused on some sectors, but paired with some authority to make real decisions regarding programmes and funding. ESF resources could be used to implement a pilot project, testing the proposed approach of local partnerships in several communities. The ESF could support this work, for example by funding projects addressed to labour market, training, vocational education and social integration coordinated by these bodies.
Another approach would be to focus on strengthening labour market councils rather than setting up new institutional arrangements or structures. In practice, this would require stepwise increases in capacity and authority, as improvements in one will not be beneficial without improvements in the other. This could be done in several ways, such as through a national capacity building or technical assistance programme for all labour market councils linked to specific statutory authority, seconding staff to help support the functioning of the boards, or providing incremental authority for labour market councils, starting with those that have demonstrated the strongest capacities to date. ESF may be particularly beneficial, for example, in supporting capacity building programmes or seconded staff. The box below provides two examples of programmes to improve local capacities in other OECD countries.
Community Capacity Building in Newfoundland and Labrador. The Department of Innovation, Business and Rural development in Newfoundland and Labrador Canada offers a community capacity building programme to economic development organisations in order to build their capacity to be partners in regional economic development. The programme provides non-repayable contributions to not-for-profit economic development organisations such as municipalities, industry/sector groups, educational institutions and any other community based organisation involved in economic development. In addition, it provides training and supports development sessions based on a series of certified programme modules. These modules include sessions on the following topics: strategic planning, relationship building, organisational skills and management and co-operative development.
Strong Cities, Strong Communities. In order to help the American cities hardest hit by the recession, the Strong Cities, Strong Communities (SC2) initiative is a new model of federal-local collaboration, intended to improve how the federal government works with local governments to further job creation and local economic development. It includes several strands. Interagency federal SC2 teams work with selected cities to help them better navigate existing federal agencies and programmes while providing technical assistance and expertise. Additionally, through the SC2 fellowship programme, early- to mid-career professionals complete 2 year fellowships in mayor’s offices or local government agencies to assist in the design and implementation of strategic projects. Another strand is the economic visioning challenge, through which federal supports are provided to cities to help them implement a “challenge competition” in which teams of professionals submit economic development proposals, with the best proposal receiving a financial prize. Finally, through the SC2 National Resource Network, several types of technical assistance are available, including direct support, access to peer networks, and on-line tools and resources.
Source: Skinner, G. (2012), “Department of Innovation, Business and Rural Development, Government of Newfoundland and Labrador”, OECD Conference, October 2012, www.oecd.org/rural/krasnoyarsk/3%20Gillian %20Skinner_MR2_Skill%20Building_ENG.pdf; White House Council (2013), “Strong Cities, Strong Communities Initiative”, 1st Annual Report, April 2013, www.huduser.org/portal/publications/pdf/huddoc.pdf.
Recommendation: Increase the availability and use of data at the sub-national level and build a stronger evaluation culture.
In order to design and implement appropriate, well targeted employment and skills programmes, there is a need for in-depth knowledge about current and future labour market needs and skills gaps. The analyses should be conducted at least at the sub-regional level and take into account sectoral specifics. Otherwise, there is a risk of generating findings that are too general and of low utility. It is also critically important to make sure that the analyses will be presented in a user-friendly form. The academic approach of presenting findings, which is unfortunately often present in reports, should be avoided.
This task could be conducted by regional observatories of the labour market, which exist in almost each region, as well as regional territorial observatories. Of critical importance is developing a sound methodology for assessing labour market needs as well as for forecasting future needs and trends at the sub-regional level. The methodology could be developed in close co-operation with the Ministry of Family, Labour and Social Policy, Ministry of Economic Development (which coordinates the network of regional territorial observatories) as well as representatives of regions, social partners and experts. One example of an approach taken in the United States is described in Box 4.3.
The Workforce Intelligence Network (WIN) provides opportunities for co-ordination and innovation across partners by delivering actionable marketplace intelligence to support more efficient solutions for employers. This information helps consortium members, particularly community colleges, make better “real time” decisions regarding skill gaps. One of the tools used by WIN is a methodology to search the internet for job openings and resumés. This information, combined with data from the state’s labour market information and special surveys, is incorporated in strategic plans and operational decisions. For example, SEMCA (the local Workforce Investment Board that manages employment services) has been able to act upon this information and is currently working to create a talent pool for Computerised Numerical Control and Welding. SEMCA also relies on WIN for detailed analysis of specific industries and occupations. Each year it completes a “Region Top Jobs” report, which includes the availability of current and projected opportunities by occupation, with the number of openings, and the rates of pay.
Within the advanced manufacturing sector, WIN connects with various organisations and associations and is leading important initiatives to better align the talent system with talent needs. WIN serves as project lead and fiscal agent for InnoState – a new coalition among WIN, the Detroit Regional Chamber’s Connection Point, the Michigan Manufacturing Technology Centre, the National Centre for Manufacturing Sciences, the Business Accelerators of Southeast Michigan, and the Society of Manufacturing Engineers. Backed by funding from the Michigan Economic Development Corporation and various federal government agencies, InnoState is focused on expanding the New Product Contract Manufacturing Cluster of firms to increase their business and compete globally. WIN also convenes the skilled trades taskforce, which addresses employer talent needs through ongoing dialogue between the talent system and employers looking for skilled trades talent.
In the area of IT, which includes some of the fastest growing firms in the region, WIN’s cluster strategy includes the convening of an employer-led, multi-industry council, which has come to be known as the Tech Council of Southeast Michigan. The Council is convened to raise awareness of and shape community responses to regional talent needs. This group meets routinely and has two primary foci: talent attraction and development; and marketing and branding Southeast Michigan as a technology hub.
The Council is comprised of more than 30 employers who have a significant need for information technology talent and is open to any additional company who may be interested in participating. WIN is directly involved with company-led training initiatives like ’IT in the D’ and serves as a communication conduit for the region’s various talent partners. WIN is also working closely with the Michigan Economic Development Corporation, the State of Michigan, business accelerators, and many others to collaborate and help drive their efforts and programmes aimed at closing the IT talent gap in Southeast Michigan.
Source: OECD (2014a), “Employment and Skills Strategies in the United States”, OECD Reviews on Local Job Creation, OECD Publishing, Paris, https://doi.org/10.1787/9789264209398-en.
In order to facilitate the ongoing improvement of programme quality and efficiency, poviat labour offices, VET institutions and other actors should regularly receive information about the situation of their clients after they have completed a programme, training or vocational education. Currently, poviat labour offices analyse only short-term information (3 months after programme completion), which is insufficient to make sound and reliable conclusions about programme effectiveness. Thus, the approach should be redefined, with a stronger focus on long-term employment effects, including the stability of the job as well as the quality of employment.
In order to improve the reliability of the above-mentioned monitoring and data, it is recommended that co-operation be strengthened with Social Insurance Institutions (ZUS), which can provide accurate and up-to-date information on participants’ actual situation on the labour market. In fact, poviat labour offices already co-operate with ZUS, and the Ministry of Economic Development is already working with ZUS on developing a monitoring system of the results of ESF-financed programmes. This demonstrates that such co‐operation and exchange of information is possible, with ZUS providing long-term information on the status of participants on the labour market, the stability of employment as well as the level of wages.
It is also important to develop the culture and practice of evaluating local employment, training and VET programmes. Evaluation should provide information on actual effects, taking into consideration side effects (e.g. deadweight), as well as a better understanding of the actual needs of recipients, what works, why and how to improve the programmes. Taking into consideration that there may be not enough skills and capacity at the local level to conduct a good quality evaluation, this task could be managed at the regional level.
Adding value through skills
Recommendation: Make the VET system more responsive to local labour market needs, including through better engagement of local employers
A clear gap identified through this work was a misalignment between the VET system and local labour market needs. During the local roundtables, stakeholders estimated that employers found 70% of the curriculum in VET programmes irrelevant. Rather than being responsive to local labour market needs, VET programme offerings appear to be much more “path dependent” in that they are determined by the capacity and previous experience of existing VET institutions, including the profile and competences of VET teachers and equipment. While some promising examples do exist – such as the Centre for Practical Education in Radom and the vocational school in Centre for Practical Education in Radomędz – overall more could be done in this area.
One important step would be better engaging employers in VET systems, both in the day-to-day practicalities of offering work-based learning opportunities as well as at a more strategic level in determining local VET provision and curriculum. Well-prepared staff could mediate between schools and employers, helping schools to better understand the needs of employers and accordingly adjust the curriculum and practice of vocational education. These agents could be employed by local authorities and trained by the National Centre for Supporting Vocational and Continuing Education. Another approach would be setting-up advisory councils, as demonstrated in Box 4.4. Regardless of the approach taken, what is critical is having some type of mechanism for better linking these two groups of stakeholders.
In Ontario, Canada, Program Advisory Committees composed of employers help to ensure that community colleges are educating and training graduates with the right skills for current job markets. They are a critical resource in ensuring the relevancy and application of college programs and meeting the needs of business and industry, and also provide community colleges with an early “heads up” to capitalise on emerging trends and new technologies. These committees, reporting through the president, are responsible to the Board of Governors, and play an instrumental role in the development of new programs and the monitoring of existing programs. Some of the primary responsibilities of Programme Advisory Committee are to:
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Advise college staff in defining graduate profiles and program learning outcomes;
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Provide input into the development and evaluation of the curriculum;
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Recommend and assist the College in developing new programs of study by providing information on the needs of specific industries/professions or developments in the community;
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Advise the College on the availability and suitability of community resources and industry support for work experience components of programs (e.g. co-op, clinical experience, field placement, summer employment and/or apprenticeship), and assist in recruitment of the placements for students, where possible;
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Provide input regarding community and industry trends that impact program outcomes and placements;
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Advise the College on suitability of resources such as facilities, laboratories and equipment as they relate to the learning process;
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Maintain an active public relations profile for the program and the college within industry and the community and ensure there is an ongoing public awareness of current and emerging career opportunities;
Source: OECD (2014b), “Employment and Skills Strategies in Canada”, OECD Reviews on Local Job Creation, OECD Publishing.
Strong and engaged employer associations can also play a critical role in supporting and improving VET provision. For example, in Wielkopolska, there is a strong tradition of apprenticeship in crafts enterprises, with the local craft association playing a key role. While not all local areas have this type of strong local employer associations, important progress is already being made with the Polish Agency for the Development of Entrepreneurship setting up sector councils. Going forward, attention will need to be paid to how these national developments can translate to strong associations at the local level as well.
The experience of the staff of VET schools which have successfully co-operated with local employers in establishing high quality vocational education should be regarded as a resource that could be used to improve other VET institutions. This resource could be leveraged through a coaching programme, which engages professionals from successful schools to work intensively with those requiring support in this area. An additional instrument could be the creation of a network of vocational institution staff, serving as a tool to transfer the knowledge and experiences of employers and VET working together. This type of support can be provided by regional and local centres for school development, potentially with the support of ESF.
Finally, due to a number of factors, including relatively low pay that makes it hard to recruit strong applicants and a stringent Charter of Teachers that makes it difficult to adjust staffing, stakeholders reported that VET teachers often have out of date skills and knowledge and there is little flexibility to adjust courses taught to labour market demands. While re-examining the national framework for VET teachers may be beneficial in the long-term (e.g. increasing pay or prestige of the position), in the shorter-term and at the local level, a number of other strategies could be used. This includes implementing measures to upgrade the skills and knowledge of existing teachers, for example through encouraging VET teachers to spend time in workplaces and participate in workplace training themselves (OECD, 2014c). Another complementary approach would be engaging more industry trainers in VET institutions. While their workplace and industry knowledge would be more up-to-date than teachers, they, on the other hand, may need more training around pedagogy and classroom and lab instruction. Such training may also be beneficial for workplace trainers who supervise apprenticeships. The box below provides an example of a programme in Finland that has created this type of virtuous circle between VET teachers and workplace trainers.
The Telkkä programme in Finland offered vocational teachers the opportunity to undertake a two month on the job placement in which they were partnered with workplace trainers. For teachers, this provided the opportunity to update their professional skills, while workplace trainers had the opportunity to improve their pedagogical skills. Benefits reported by the teachers included updating workplace knowledge (familiarity with recent work practices and requirements and the equipment used) better networks and connections (which could be used to organise study visits, invite guest lecturers into the classroom), as well as increased confidence, motivation, and respect from students. The training period also gave teachers and workers the opportunity to discuss issues related to workplace training and improve training plans and assessment methods. The training period was complemented by a pre‐training seminar to clarify goals. After the training, both teachers and workers were given the opportunity to provide feedback, which was synthesised across participants and disseminated to the broader community. The Economic Information Office in Finland has identified this programme as one of the best ways to develop teachers’ professionalism.
Source: Cort, Härkönen and Volmari (2004), Field, S. et al. (2012), A Skills beyond School Review of Denmark.
Recommendation: Expand basic skills training opportunities
Despite a demonstrated need for basic skills training, there appears to be relatively few offerings in terms of basic skills development. Basic skills trainings are not common within training or VET institutions, or through poviat labour offices. There were some institutions in both case study areas offering courses at the level of gymnasium (ISCED 2a level) for adults. However, this training is more popular among relatively young people who had challenges finishing schools, rather than amongst older workers or jobseekers. Findings from this work as well as the OECD’s 2016 Economic Survey of Poland both suggest a need for targeted interventions to improve basic skills.
While research on policy interventions to improve adult literacy and numeracy skills highlights the difficulties in designing successful programmes, a number of best practices can be drawn from the experiences of other OECD countries (Windisch, H.C. 2015) For one, outreach strategies that focus just on responding to existing demands, are unlikely to be successful, given that adults are often unable or unwilling to recognise their own basic skills weaknesses. Rather, outreach should seek to enhance motivation and awareness of the benefits of and opportunities to develop basic skills, targeting both the learners themselves as well as their employers, families and friends. Additionally, this research stressed that there is no “one-size fits all” approach, and rather programmes need to be tailored to the specific needs of particular learners. For example, the context of learning can matter significantly – some learners will respond to classroom based settings, while others may respond better to e-learning, work-based, or home- or community-based programmes. The box below provides examples of adult literacy and numeracy programmes that have used varying approaches.
ICT-based-learning. ICT-based learning has the benefits of allowing for learning independent of class schedules and location, and can benefit learners who have had negative experiences with traditional classrooms or have physical access limitations. However, limited IT access or literacy as well as a lack of social contact means it is not suited for all learners.
For example, Learndirect is a network of online learning and information services which operates in England, Wales and Northern Ireland. It collaborates with further education colleges, private training providers, voluntary and community sector organisations and higher education institutions “to enable adults without a Level 2 or Skills for Life qualification to gain the skills and qualifications they need to find a job or to achieve and progress at work” (Broek, Buiskool and Hake, 2010). Learndirect has engaged over 2.6 million learners since 2000, and has hard particular success in reaching non-traditional learners (ECOTEC, 2001).
Provision in the workplace: Literacy and numeracy programmes delivered through the workplace can benefit both employers and employees, and can reach learners not typically involved in continuous education or training, including older workers.
In Denmark, for example, the adult education centre (VUC) in Southern Jutland owns two mobile classrooms in expandable lorries that have a capacity of 18 people each, as well as a camper classroom which holds fewer students. These mobile classrooms allow the VUC to deliver basic education classes on-site at the workplace. The classrooms are fully equipped for teaching, and class sessions are scheduled during the working day, so students can come directly to and from work. VUC has found that integrating the classes into the worksite motivates students, as they can see their colleagues going to class in their work clothes and hear them talking about class in the lunch break. For smaller companies that are not able to “release” a critical mass of employees for a class, VUC has also offered multi-company classes that are easily accessible for all participants.
Family literacy programmes: Recognising the strong intergenerational links between parents’ and their children’s literacy, family literacy programmes engage adults in their roles as parents as well as learners in their own rights.
One example is the Family Literacy Project in Hamburg, which has offered intergenerational family literacy programmes for children and parents from deprived social and migrant backgrounds since 2004. This programme has had a positive effect both on the parents and children involved (stronger family relationships and improved literacy skills) as well as on the kindergarten and school teachers, who have been able to enhance their intercultural teaching skills. The programme reaches about 1 000 parents and 1 000 children annually, and as a result of the project’s success, many schools in Hamburg have established family literacy rooms where parents can meet.
Source: Windisch, H.C. (2015), “Adults with low literacy and numeracy skills: A literature review on policy intervention”. Broek, S.D., B.J. Buiskool and B. Hake (2010), Impact of ongoing reforms in education and training on the adult learning sector (2nd phase): Final Report. Eurydices (2011), Adults in Formal Education: Policies and Practices. Tamkin, P., J. Hillage, S. Dewson, and A. Sinclair (2003), “New Learners, New Learning a strategic evaluation of Ufi”. EU Lifelong Learning Programme (n.d.), Literacy needs for vocational purposes in Europe. A documentation: facts, information and examples, UNESCO (2014), “Family Literacy Project (FLY)”.
Additionally, training and vocational courses focus on the development of technical skills, with less focus on developing advanced generic skills, such as co-operating, communication, team work, being creative and innovative, although all of them are important for employers, and in some cases even more important than purely technical skills. Therefore, the training programmes provided by both poviat labour offices and VET institutions should put more emphasis on the development of these types of skills. In many cases, this would require changes in how the courses are organised (such as more emphasis on team work and communication during the courses).
Targeting policy to local employment sectors and investing in quality jobs
Recommendation: Focus efforts on improving skills utilisation and work organisation
While much attention is given to the importance of job creation, it is also critical to consider the type and quality of jobs on offer in a local area. Additionally, investment in the supply of skills alone will not be sufficient to boost job creation and productivity in all local economies. The degree to which local employers are demanding and using skills also has to be taken into account. A low demand for skills among employers may mean that people’s skills are not fully used or that workers have little incentive to upgrade their skills, knowing these skills will not be used in the jobs the local economy has to offer (OECD, 2014d).
Research also suggests a link between the way skills are used in the workplace and the potential for innovation. Countries with higher rates of work characterised by discretionary learning (high levels of autonomy in work combined with high levels of learning, problem-solving and task complexity) show higher levels of innovation while countries with more “taylorist” (low discretion and low level of learning and problem-solving) or “simple” forms of work organisation show lower levels of innovation. OECD research suggests that a bottleneck to improving the innovative capabilities of European firms might not be low levels of R&D expenditures, but rather the widespread presence of working environments that are unable to provide fertile grounds for innovation (OECD, 2010).
Recent OECD work on job quality shows that in 2014, Poland ranks in the bottom 10 of all OECD countries across the three key dimensions measured: earnings quality, labour market security, and quality of the working environment (OECD, 2016a). Additionally, as discussed earlier in this report, there is significant local variation in the demand for skills in Poland, but little policy interventions targeted towards improving skills utilisation. Finally, research into work organisation in the EU has shown that while discretionary learning in Poland is slightly higher than the EU average, it falls well below that of leading innovation countries, and actually has a higher rate of “simple” work organisation than the EU-28 average (Lorenz, 2015). A lack of high quality (or even formal) employment available to graduates of vocational schools was also raised as one reason this pathway is considered less prestigious. Taken together, these findings suggest a need to focus more on skills utilisation and work organisation with Polish employers.
Although Poland ranks highly in support for entrepreneurship skills in the Local Job Creation dashboard, this support tends to focus on supporting the “hard” skills of entrepreneurs, necessary to operate a business. As evidence proves that the productivity and development prospects of enterprises depend heavily on the quality of management, work organisation and skills utilisation, many enterprises in Poland could benefit from improvement and investment in developing these types of management skills, particularly small and medium firms.
There are new instruments supporting skills development: the National Training Fund, operated by poviat labour offices, and the European Social Fund, which in the current perspective (2014-20) will be more demand oriented. Both instruments should be used to improve skills utilisation and work organisation. New enterprises, which would like to receive financial support for skills development, could be required to prepare a plan for the improvement of skills and work organisation, with the support of the required counselling services. The plan could be based on an analysis of the needs and situation of the enterprise, and the supported skills development should be directly linked to this plan. Support for work organisation and skills utilisation could also be provided by other enterprises and employer organisations. This would require close co-operation with the main employer organisations in Poland. Two approaches to improving skills utilisation are discussed in the box below: one focusing on workplace organisation in Finland and one taking a sector approach in Australia.
“Liideri – Business, Productivity and Joy at Work Programme in Finland
Tekes, the Finnish funding agency for innovation runs a number of programmes to foster innovation, including “Liideri – Business, Productivity and Joy at Work Programme”. Unlike more traditional innovation programmes, this programme focuses workplace development, in particular developing management practices and forms of working that promote the active utilisation of the skills and competences of employees. Liideri is the latest in a series of publicly funded workplace innovation programmes in Finland, which were first launched in 1993. While these programmes were initially coordinated through the Ministry of Labour, in 2008 they were transferred to Tekes (the Finnish Funding Agency for Technology and Innovation). This transfer was part of the adoption of a new national innovation strategy that emphasises demand and user-driven innovation and non-technological innovations.
The Liideri project has three focus areas: renewal of management; employee participation in renewal of products, services and their production; and new forms of work organisation and working. A number of instruments are used to effect change in these areas, including work organisation development projects, integrated R&D projects, funding for research, and widespread dissemination of the outcomes and principles of the work (websites, social media, case studies, workshops, network of experts, etc.)
National skills ecosystem projects in Australia
In Australia, national skills ecosystem projects were introduced in 2003. The skills ecosystem approach emphasises not just how skills are developed, but also how they are deployed. With this lens, perceived skills shortages can be attributed as much to work organisation and turnover challenges as to the supply of skilled people coming from education and training institutions. The projects covered areas such as VET links with research agencies to promote innovation, promoting new technology, workplace drivers of skill formation, skills formation to support the development of an industry cluster, and job design and career paths. Projects were ambitious and aimed to achieve long-term structural change.
While the national projects have since ceased, they had worthwhile impacts in specific industry sectors and the approach continues to inspire other skills initiatives. The dairy industry in the state of Victoria, in particular, approached an increasing demand for high-end skills using the skill ecosystem methodology and has used the process successfully. The shift in product market strategy from supplying traditional commodity based markets to value-added markets with all that this entailed (e.g. tighter product specifications, the introduction of new technologies, the development of participative workplaces, higher regulatory scrutiny, and higher levels of customer expectations) were the key drivers of a well-structured, industry-driven skills ecosystem for accelerating high-end skills development.
Source: Tekes (2014), Liideri – Business, Productivity and Joy at Work; a new Finnish National Programme, www.workplaceinnovation. org/nl/kennis/kennisbank/liideri---business--productivity-and-joy-at-work--a-new-finnish-national-programme/1235. Eddington, N. and P. Toner (2012), “Skills Formation Strategies in Queensland: A Skills Shortage?”, OECD Local Economic and Employment Development (LEED) Working Papers, No. 2012/07, OECD Publishing, Paris, https://doi.org/10.1787/5k9b9mjdj4xr-en.
Recommendation: Promote economic development that is inclusive and contributes to the creation of quality jobs, including through more strategic use of public procurement
In attracting investors, public policy should be more focused on supporting investments that provide large numbers of quality jobs, rather than just jobs in general. Attracting new investors providing a large number of decent jobs requires focused attention on the part of economic development actors, as well as investing in the best quality of initial and continuing vocational education and training. Close co-operation between the education and training sector can not only help ensure the development of in‐demand skills, but also contribute to partnerships that further innovation through coordinated research and development projects. Both case study areas show that some strategic investment, with smart support from local authorities, could attract further investments and contribute to the further development of local enterprises and clusters. The box below provides two examples of local approaches to improving strengthening specific sectors and improving job quality.
Attracting a new type of tourism in Blackpool, United Kingdom. Having long been a seaside resort that caters for high volume but low-spending customers, Blackpool is working hard to raise its game and attract higher spending customers through offering a higher quality “offer”. The town has been growing its branded attractions (e.g. Madame Tussauds, Nikolodean, Merlin) while also investing significantly in infrastructure (trams, cycles, buying the Blackpool tower for the public, new concert hall, refurbished front). It is recognised that capital and infrastructure investments alone will be insufficient for realising the town’s vision, and that alongside them there is a need for investment in skills, particularly in the area of customer service. This means investment in specific skills (for example, through local college courses geared to the tourism industry) but also more informal learning and knowledge sharing.
A particular emphasis has been placed on raising the aspirations of service personnel so that they project a better image of the town and at the same time become more committed both to Blackpool, their employers and their own personal career prospects. A good example of such an initiative is the Welcome to Blackpool Initiative funded initially by the Local Enterprise Growth Initiative (LEGI) introduced by the previous UK government. This project trains local people (especially those working in hospitality, leisure, tourism, transport and retail sectors, but also local residents) in appreciating the history of Blackpool, current developments and future plans. Through course attendance, participants learn more about Blackpool’s attractions and services. The knowledge gained can then be used to enhance visitors’ and local residents’ experience of Blackpool. Employers have reported that the short course equips staff to deliver a high standard of customer service, which in turn impresses visitors to the town and encourages word of mouth recommendations and repeat visits to Blackpool. The initiative has shown that taxi drivers, those involved in tourism and local residents can be excellent ambassadors for Blackpool It was reported that over 3 000 people (of all ages) have attended the course in two years and that more than 250 organisations have benefited. Such initiatives have been useful in increasing staff retention in local firms, which traditionally have had high turnover rates, linked to the seasonality of tourism in the town. High turnover rates have been seen by some firms as representing a challenge in terms of investing in staff training and skills upgrading. Growing staff retention has allowed local employers such as the Sandcastle Water Park to start working with individuals on personal development plans.
Working with the retail sector in the municipality of Breda, Netherlands. Retail is an important part of the local economy of Breda in the Netherlands. The sector has 2 200 establishments in the area and is currently relatively stable. However, in the context of the ageing of the population it is expected that it will become more difficult to fill vacancies in the future. It is also acknowledged that more has to be done to increase the quality of employment in the sector and the productivity and competitiveness of local enterprises, particularly small and medium-sized enterprises (SMEs). Several organisations, such as the National Board for Retail Trade, the Retail Platform Breda, the Association of Enterprises in the city centre of Breda, the Chamber of Commerce and Werkplein Breda (a service to help people to access jobs which combines the public employment service and the local municipal social service department), have taken the initiative to establish a service unit for the retail sector (Servicepunt Detailhandel). The objective of this service unit is threefold:
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Improving the inflow and outflow of workers and better managing labour market transitions within the sector: for example, by improving the match between demand for labour and supply of labour through investments in skills
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Training of staff: implementing an external information and advice service on human resource management for SMEs to improve work organisation, productivity and the quality of local job opportunities
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Improving the image of the sector: stimulating and organising extra promotion with regard to working in the retail sector, improving customer satisfaction.
The strength of the service unit is that the approach is demand driven and based on one-on-one relationships with local retailers. If action is needed, this takes place immediately through individual company visits and visits to the members and board meetings of the association of retailers. Local work coaches (placing local people into work) also receive training from the National Board for Retail Trade.
In early 2010 a similar service point was established for the care and welfare sectors, with plans to develop one for technical professions. One consulted business representative felt that through this collaboration they have come a long way in a short period of time.
Source: Dorenbos, R. and F. Froy (2011), “Building flexibility and accountability into local employment services: Country report for the Netherlands”, OECD Local Economic and Employment Development (LEED) Working Papers, No. 2011/13, OECD Publishing, Paris, https://doi.org/10.1787/5kg3mktqnn34-en; Froy, F., S. Giguère and M. Meghnagi (2012), “Skills for competitiveness: A synthesis report”, OECD Local Economic and Employment Development (LEED) Working Papers, No. 2012/09, OECD Publishing, Paris, https://doi.org/10.1787/5k98xwskmvr6-en.
Another underused policy lever is the direct spending power of the public sector. Public authorities – local, regional and national – should strengthen the utilisation of public procurement and investment to promote quality job creation as well as create job and/or training opportunities for the unemployed and other disadvantaged groups. This would require a stronger emphasis on the social aspects of public procurement tenders, as well as strong support for this approach from national and regional authorities. Within national and EU regulations, there may be particular opportunities to consider how projects using EU structural funds can be strategically leveraged to support these types of social aims in addition to their other objectives.
The city of Most (Ústí nad Labem region) applied the condition that as part of four public contracts for the construction of flats in the Chanov quarter (a socially deprived locality) and one public contract for cleaning, 10% of all those hired had to be long-term unemployed. The cleaning services contract was awarded to a firm that hired one long-term unemployed person. Other long-term unemployed were also hired on short-term contracts. Candidates were put forward by local non-profit organisations and were mainly people with low levels of education, skills and work experience who, according to senior staff, were able and willing to learn. Five out of seven persons stayed in their job after completion of the contract and two were offered a permanent contract. The newly hired workers performed preparatory technical work, finishing and ancillary works.
Applying the 10% condition in tendering contracts did not burden bidders or make the contract more expensive for the city. The firms have been considering not only fulfilling the mandatory 10% quota but hiring other long-term jobless. The city of Most has incorporated the procurement terms into the Integrated Development City Plan and is considering how it can be applied to other contracts. The Agency for Social Inclusion has included the example of Most in a manual for municipalities to encourage them to take similar approaches.
Source: Agency for Social Inclusion (2012), “Guide for Municipalities”, www.socialni-zaclenovani.cz/prirucka.
Recommendation: Ensure that adequate career guidance and information on pathways are available to both youth and adults, and that it is informed by local labour market assessments.
Most of the study participants agreed that there is a need to boost access to career guidance and improve its quality. This pertains to career guidance for young people and adults. In the case of young people, schools are obliged to provide career guidance. However, the law should clearly state the minimum amount of career guidance. The best results are achieved when there is a special structure (unit, group of teachers) responsible for providing these services and sufficient resources devoted to this task (time and persons). The second important aspect is the competence of persons providing these services. They should have the appropriate training and improve their skills in an ongoing manner. Thus, various opportunities for skills development should be created at the regional and local levels (e.g. training courses, networks, and on-line courses). Also, standards for career guidance and supporting material should be developed. This is a task that could be the responsibility of the National Centre for Supporting Vocational and Continuing Education.
Being inclusive
Recommendation: address gaps in services for most disadvantaged clients of public employment services
The recent reforms of the PES included a profiling system that classified clients into one of three groups: Stream I, Stream II, or Stream III. Stream III clients are those considered to be the farthest from the labour market and/or not ready to take up employment. The labour offices are considered not have the tools or resources to serve these clients, and thus the decision was taken to outsource support for these clients.
However, preliminary implementation results suggest significant challenges in the set-up of the current system. For one, it appears that there is little interest from social assistance centres, NGOs or private providers in running programmes for Stream III clients. Additionally, unlike Stream II clients, who can be served with a variety of instruments, the options for Stream III clients are much more limited. Some clients classified as Stream III could benefit from the instruments available to Stream II clients. Finally, the performance management system is focused on incentivising employment outcomes, without incentives for providing the other types of supportive services (e.g. wrap-around case management, mental health services, drug or alcohol counselling) that these clients may need before they are ready for stable employment. Overall, this leaves a major gap in the level and types of services available for the PES clients who may be most in need.
A number of approaches could help remedy this gap. For one, local PES staff could be given more discretion in moving clients from Profile III to Profile II where appropriate. The performance management incentives already in place could serve as one safeguard for ensuring that this is only done in cases where warranted. Additionally, the terms of the outsourcing arrangements for instruments used for Stream III clients may need to be revisited to make them more attractive to a broader range of potential providers. Performance measures for Stream III clients could also be adjusted to remove any disincentives to “bypass” necessary supports such as mental health counselling, etc.
Recommendation: Improve access to care services, particularly for children aged 0-3 years of age
The OECD’s Economic Survey of Poland highlighted insufficient child care policies as a major structural weakness in the economy (OECD, 2014e; OECD, 2016b). There is still a large gap in access to childcare services for children younger than 3 years of age and those 3 years of age and older. This is particular the case in rural areas, but it is also an issue in larger cities, such as Poznań. The lack of affordable childcare services reduces the opportunities of parents, particularly women, on the labour market. This problem particularly concerns the youngest parents, at a low educational level or even during their education, who are not able to afford private childcare services.
The development of childcare services should focus on locally based, flexible forms of services, such as a daily nanny. This does not require a large investment and the scope of such services can quickly be adjusted to the actual demand. It can also provide job opportunities for older persons, who may be experiencing problems on the labour market.
The government has recognised the importance of developing affordable and quality child care services to increase the female labour market participation rate as well as to promote strong work-life reconciliation. Significant improvements have been made through a number of initiatives. Local governments have been encouraged to develop child care facilities and funding has been increased to subsidise more child care places for families. More efforts will need to continue build the child care infrastructure and to encourage flexible working arrangements. The government should encourage employers to adopt family friendly practices and seek to promote companies who are leaders in this area. Opportunities to build and better connect child care facilities to primary schools should be explored to build a seamless one-stop service for parents. Early years education and development is a critical determinant of future labour market success; therefore action must continue to develop a variety of child care arrangements.
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