Education post-2015: A currency to invest in

©Issei Kato/REUTERS

The world is no longer divided between rich and well-educated countries and poor and badly educated ones.

Importantly, when it comes to education, the post-2015 agenda for sustainable development is no longer just about providing more people with more years of schooling, but about making sure that individuals acquire a solid foundation of knowledge in key disciplines; that they develop creative, critical thinking and collaborative skills; and that they build character attributes, such as mindfulness, curiosity, courage and resilience.

The first thing our 2015 report, Universal Basic Skills: What Countries Stand to Gain, shows is that the quality of schooling in a country is a powerful predictor of the wealth that the country will produce in the long run. Or, put the other way around, the economic output that is lost because of poor education policies and practices leaves many countries in what amounts to a permanent state of economic recession–and one that can be larger and deeper than the one that resulted from the financial crisis at the beginning of the millennium, out of which many countries are still struggling to climb.

Among the countries compared, Ghana has the lowest enrolment rate in secondary schools (46%) and also the lowest achievement levels for those 15-year-olds who are in school (291 PISA points, under the OECD’s Programme for International Student Assessment). While it is difficult for Ghana to meet the goal of universal basic skills any time soon, if it did, it would see a gain over the lifetime of its children born today that, in present value terms, is 38 times its current GDP. This is equivalent to tripling Ghana’s discounted future GDP every four years during the working life of those students with improved skills. For lower-middle income countries, the discounted present value of future gains would still be 13 times current GDP and would average out to a 28% higher GDP over the next 80 years. And for upper-middle income countries, which generally show higher levels of learning outcomes, it would average out to a 16% higher GDP. 

The goal of universal basic skills also has meaning for high income countries, most notably the oil-producing countries. Many of them have succeeded in converting their natural capital into physical capital and consumption today, but they have failed to convert their natural capital into the human capital that can generate the economic and social outcomes to sustain their future. The report shows that the high income non-OECD countries, as a group, would see an added economic value equivalent to almost five times the value of their current GDP if they equipped all students with at least basic skills. So there is an important message for countries rich in natural resources: the wealth that lies hidden in the undeveloped skills of their populations is far greater than what they now reap by extracting wealth from national resources. And there is more: PISA shows a significantly negative relationship between the money countries earn from their natural resources and the knowledge and skills of their school population. So PISA and oil don’t mix easily. 

One interpretation is that in countries with little in the way of natural resources, education is highly valued and produces strong outcomes, at least partly because the public at large has understood that the country must live by its knowledge and skills, and that these depend on the quality of education. In other words, the value that a country places on education may depend, at least in part, on its view of how knowledge and skills fit into the way it makes its living. 

One might be tempted to think that high income countries have had all the means to eliminate extreme underperformance in education and should already have achieved the education post-2015 goal and targets. But the report shows otherwise. For example, 24% of 15-year-olds in the United States do not successfully complete even the basic Level 1 PISA tasks. If the United States were to ensure that all students meet the goal of universal basic skills, the economic gains could reach over US$27 trillion in additional income for the US economy over the working life of these students. So even high income OECD countries would gain significantly from bringing all students up to basic skills by 2030. For this group of countries, average future GDP would be 3.5% higher than it would be otherwise. That is close to what these countries currently spend on their schools. In other words, the economic gains that would accrue solely from eliminating extreme underperformance in high income OECD countries by 2030 would be sufficient to pay for the primary and secondary education of all students. 

The message of these rather complex analyses is simple: there is no shortcut to improved learning outcomes in a post-2015 world economy where knowledge and skills have become the global currency, the key to better jobs and better lives. And there is no central bank that prints this currency. We cannot inherit this currency, and we cannot produce it through speculation; we can develop it only through sustained effort and investment in people. 

That raises the question of whether the improvements in learning outcomes suggested in our 2015 report are realistic–and how they can be achieved by 2030. The answer to the first question is unambiguously positive. PISA shows that top performers in education, such as Korea, Singapore and Shanghai in China, were able to further extend their lead over the past years, and countries such as Brazil, Mexico, Tunisia and Turkey achieved major improvements from previously low levels of performance–all at a speed that exceeds, by a large margin, the improvements described in this report. So the world is full of examples of improvements in education, and there is no time to lose. Without the right skills, people end up on the margins of the society, technological progress doesn’t translate into economic growth, and countries face an uphill struggle to remain ahead in this hyper-connected world. Ultimately in this scenario, the social glue that holds our societies together will disintegrate. The world has become indifferent to past reputations and unforgiving of frailty. Success will go to those individuals, institutions and countries that are swift to adapt, slow to complain and open to change. The task for governments is to help their citizens rise to this challenge by ensuring that by 2030 all of their people are equipped with the knowledge and skills they need for further education, work and life.

Adapted from OECD Education Today blogspot, published May 2015

References

See http://en.unesco.org/world-education-forum-2015/ and https://blogs.worldbank.org/education/

Visit www.oecd.org/pisa/

OECD (2015), Universal Basic Skills: What Countries Stand to Gain, OECD Publishing.


Follow on Twitter: #UniversalBasicSkills

©OECD Observer No 303, September 2015

More:

Education




Economic data

E-Newsletter

Stay up-to-date with the latest news from the OECD by signing up for our e-newsletter :

Twitter feed

Suscribe now

<b>Subscribe now!</b>

To receive your exclusive print editions delivered to you directly


Online edition
Previous editions

Don't miss

  • Africa's cities at the forefront of progress: Africa is urbanising at a historically rapid pace coupled with an unprecedented demographic boom. By 2050, about 56% of Africans are expected to live in cities. This poses major policy challenges, but make no mistake: Africa’s cities and towns are engines of progress that, if harnessed correctly, can fuel the entire continent’s sustainable development.
  • “Nizip” refugee camp visit
    July 2016: OECD Secretary-General Angel Gurría visits the “Nizip” refugee camp, situated between Gaziantep and the Turkish-Syrian border, accompanied by Turkey’s Deputy Prime Minister Mehmet Şimşek. The camp accommodates a small number of the 2.75 million Syrians currently registered in Turkey, mostly outside the camps. In his tour of the camp, Mr Gurría visits a school, speaks with refugees and gives a short interview.
  • OECD Observer i-Sheet Series: OECD Observer i-Sheets are smart contents pages on major issues and events. Use them to find current or recent articles, video, books and working papers. To browse on paper and read on line, or simply download.
  • Queen Maxima of the Netherlands gives a speech next to Mexico's President Enrique Pena Nieto (not pictured) during the International Forum of Financial Inclusion at the National Palace in Mexico City, Mexico June 21, 2016.
  • How sustainable is the ocean as a source of economic development? The Ocean Economy in 2030 examines the risks and uncertainties surrounding the future development of ocean industries, the innovations required in science and technology to support their progress, their potential contribution to green growth and some of the implications for ocean management.
  • OECD Environment Director Simon Upton presented a talk at Imperial College London on 21 April 2016. With the world awash in surplus oil and prices languishing around US$40 per barrel, how can governments step up efforts to transform the world’s energy systems in line with the Paris Agreement?
  • Happy 10th birthday to Twitter. This 2008 OECD Observer interview with Henry Copeland said you’d do well.
  • The OECD Gender Initiative examines existing barriers to gender equality in education, employment, and entrepreneurship. The gender portal monitors the progress made by governments to promote gender equality in both OECD and non-OECD countries and provides good practices based on analytical tools and reliable data.
  • Once migrants reach Europe, countries face integration challenge: OECD's Thomas Liebig speaks to NPR's Audie Cornish.

  • Message from the International Space Station to COP21

  • COP21 Will Get Agreement With Teeth: OECD Secretary-General Angel Gurría on Bloomberg

  • The carbon clock is ticking: OECD’s Gurría on CNBC

  • If we want to reach zero net emissions by the end of the century, we must align our policies for a low-carbon economy, put a price on carbon everywhere, spend less subsidising fossil fuels and invest more in clean energy. OECD at #COP21 – OECD statement for #COP21
  • They are green and local --It’s a new generation of entrepreneurs in Kenya with big dreams of sustainable energy and the drive to see their innovative technologies throughout Africa. blogs.worldbank.org
  • Pole to Paris Project
  • In order to face global warming, Asia needs at least $40 billion per year, derived from both the public and private sector. Read how to bridge the climate financing gap on the Asian Bank of Development's website.
  • How can cities fight climate change?
    Discover projects in Denmark, Canada, Australia, Japan and Mexico.
  • Climate: What's changed, what hasn't, what we can do about it.
    Lecture by OECD Secretary-General Angel Gurría, hosted by the London School of Economics and Aviva Investors in association with ClimateWise, London, UK, 3 July 2015.

  • Climate change: “We should not disagree when scientists tell us we have a window of opportunity–10-15 years–to turn this thing around” argues Senator Bernie Sanders.

  • In the long-run, the EU benefits from migration, says OECD Head of International Migration Division Jean-Christophe Dumont.
  • Is technological progress slowing down? Is it speeding up? At the OECD, we believe the research from our Future of ‪Productivity‬ project helps to resolve this paradox.
  • Is inequality bad for growth? That redistribution boosts economies is not established by the evidence says FT economics editor Chris Giles. Read more on www.ft.com.
  • Catherine Mann, OECD Chief Economist, explains on Bloomberg why "too much bank lending can slow economic growth".
  • Interested in a career in Paris at the OECD? The OECD is a major international organisation, with a mission to build better policies for better lives. With our hub based in one of the world's global cities and offices across continents, find out more at www.oecd.org/careers .

Most Popular Articles

Poll

What issue are you most concerned about in 2016?

Unemployment
Euro crisis
International conflict
Global warming
Other

OECD Insights Blog

NOTE: All signed articles in the OECD Observer express the opinions of the authors
and do not necessarily represent the official views of OECD member countries.

All rights reserved. OECD 2016