Addressing the skills-jobs mismatch in the Philippines

ONE of the main reasons why we can’t seem to make a dent on joblessness, according to Socioeconomic Planning Secretary Romulo Neri, is that “many students are taking courses that will not land them jobs needed by industries.”

He added that students who are entering college “should no longer take courses in political science, education and law since there is already a significant surplus” in these fields. Industries supposedly need more graduates in engineering, mining and information technology.

We can’t help but agree. If we want this country to move a lot faster, we need a critical mass of engineers, mathematicians, software developers, physicists, and other fields in the sciences like biotechnology. These courses are the ones that really bring in the money and progress, as shown by countries that invested heavily in uplifting their school systems capability in mathematics and the sciences. We are talking here of places like Israel, Taiwan, China, Vietnam and India.

But if indeed these courses do give high economic returns for graduates, why is it that only a few students are taking up these subjects? There are several reasons.

First is that there is probably no market signal for students to take these courses, essentially because parents and students are not really aware of economic opportunities in these disciplines. If this is true, one reason is that there is no labor-market information system that could help students in making career decisions.

In the United States, the government provides this kind of information by releasing a regular 10-year forecast on potential labor demand vis-à-vis different careers in almost all areas of specialization from teachers, engineers, journalists and doctors. The report, updated each year and posted on the Internet, even provides estimates of the annual income that graduates would get if they take a certain discipline.

Why couldn’t we do the same? In the Philippine context, the government could do it in collaboration with the private sector. Most business organizations in the country are members of chambers of commerce and associations. Managers and HR officers in these companies could expedite this job-market information system by regularly submitting their staff requirements from which their organizations could collate, analyze and disseminate through media.
Second is that some schools are probably not providing the right sets of skills to students. Many schools providing tertiary education are privately owned whose profit imperative may come in the way of providing quality education.

There essentially is nothing wrong with a tertiary educational system dominated by the private sector. The United States has that kind of system and all the world is flocking to American shores to study. It works there because students and their parents have access to information regarding the quality of educational services being offered by schools through a ranking system that economically penalizes those that don’t have the right faculty, facilities and the learning environment.

We should have the same system in the Philippines. If schools and universities here are ranked based on quality of services provided by course or disciplines by university, parents would only enroll their children where they could get quality education in return for their hard-earned money. That way, schools and universities would have the economic incentive to provide the best facilities, qualified faculty members and the best learning environment for students.
Quality schools, of course, would have the tendency to charge high tuition, but this concern could be addressed partially through competition by opening foreign direct investments in schools and universities. Besides, who says quality education is cheap?

Financing education is really a major problem in the Philippines. Many private universities want to invest in laboratories and faculty development. Yet they can only do that through expensive tuition, an option that is constrained by low purchasing power.

The only way to address this is by setting up some kind of a student loan program where students could pay the State later once they are able. Australia has that kind of system and Britain is learning from it. We could probably have the same here.

The private sector could probably help. If society looks at education as an “investment” with very high rates of return, why are banks not giving education loans to students who want to study “profitable” courses like engineering and the sciences? In India for instance, banks lend money to engineering students and MBA students, knowing that these kids would soon earn huge sums once they start working in high-tech industries in Bangalore, Chennai, New Delhi and Hyderabad.

The third factor: there are simply fewer people who can endure the rigors of science and engineering courses. If this is true, then the problem goes back to the poor quality of basic education. The solution, therefore, is reforming the elementary-schools system.

One possible solution is by strengthening subjects that really matter: mathematics, science, English and Filipino with laboratories on said subjects. Longer school hours can be assigned to these subjects so the students could have more time to learn new science or math concepts.
At the same time, there is an urgent need to train teachers in science, math and English. It is common knowledge that for lack of science and math teachers, many current teachers in these subjects had backgrounds in social studies, or even physical education. The government should also send these teachers to scholarships for higher learning.

Reforming the elementary-school system would take some time. But we can also take a few shortcuts by investing in science high schools. The local government units and the national government could do this through a counterparting arrangement. With more science high schools in cities and the big municipalities, we could probably increase the number of students who will eventually take science courses.

Definitely, the government will have to strengthen higher education as well. This can be done by streamlining state colleges and universities—for instance, by closing some of them and consolidating others to focus on science and technology and leaving the teaching of social sciences to private universities. The Indians are doing this through their seven institutes of technologies and research institutions where only the cream of the crop is taken as students. That explains their strength in the sciences, engineering and information technology.

Note: Drafted as editorial for BusinessMirror, 12 June 2007