White Paper

This report presents the first results of the Programme for the International Assessment of Adult Competencies (PIAAC), an initiative of OECD. PIAAC provides internationally comparable measures of three skills that are essential to processing information: literacy, numeracy, and problem solving in technology rich environments (referred to as PS-TRE). The report provides information about the literacy, numeracy, and PS-TRE skills for the Canadian population aged 16 to 65. It provides results for Canada as a whole, as well as for all the provinces and territories. In addition, it looks at the relationships between skills proficiency and a range of socio-demographic characteristics (e.g., age, gender, level of education) across the entire Canadian population. It also reports on first results on the literacy, numeracy, and PS-TRE skills of Aboriginal populations, immigrants, and official language minority communities.

Recent discussions of lifelong learning point to problem solving as one of the major competencies to be fostered in a lifelong learning process. Yet, compared to other domains of learning, problem-solving has received less attention in the literature, in part because of a lack of information on this topic. A new report, based on the Adult Literacy and Life Skills Survey (ALL), provides information that helps to address that gap. The Adult Literacy and Life Skills Survey assessed four foundation skills thought to be essential for social, professional and economic success – prose literacy, document literacy, numeracy and problem solving. Eleven countries, including Canada, participated in the most recent Adult Literacy and Life Skills Survey, which was conducted in two main waves between 2002 and 2008. This article summarizes the key findings reported in that report, focusing on problem-solving skills, their definition, distribution in the labour force and related labour market outcomes. The development of the analytical and measurement frameworks for the skills domains assessed in ALL took account of observations of skills made in the workplace. Figure 1 illustrates one of many models that were developed to understand which skills matter economically. The triangle identifies three hierarchical levels of skill, starting at the bottom with basic skills that are thought to be required by all occupations and hence are considered to be portable between jobs and employers. According to this model, both literacy and numeracy fall into this category. The second layer of the triangle identifies a set of skills that are used in the workplace which are still portable, but which vary across broad industry and occupational groups. Problem-solving skills are positioned in this level. The third level concerns skills that are specific to a particular job or even firm and that are considered to be non-portable in the labour market.

At first glance, the UK seems to have relatively positive levels of employer provided training, with 65% of employers providing training to their staff and international surveys suggesting the proportion of establishments which provide training is higher than in other EU nations. However, almost a quarter of establishments have never funded or arranged training for their staff; less of this training is certified when compared to other EU nations and training also accounts for a lower proportion of labour costs compared to the EU average. Businesses that employ few people and establishments in certain sectors are least likely to fund or arrange training and these patterns have been true for a number of years. Whilst there are a range of reasons why some businesses do not train their staff, there is evidence that those which do, enjoy considerable benefits relating to survival, productivity, employee job satisfaction and lower absentee rates. It is in this context that the UK Commission for Employment and Skills was asked to review the range of policy levers designed to encourage employers to train on a collective basis (Collective Measures), such as levies and Licenses to Practice. The UK Commission undertook extensive literature reviews, on-line consultations, policy prioritisation events with stakeholders and initial economic appraisals, to inform the advice presented in this report. The work began with a review of the conceptual literature on the optimal level of employer investment in skills and training and whether public policy could be used to move closer to these levels. It finds that there are a number of factors which can lead to sub-optimal provision at firm and sector level and that this provides a case for State intervention, providing the benefits of doing so would demonstrably outweigh the costs. It suggests that sectoral intervention is probably the most important way of stimulating skills development in the UK: there is a commonality of skill needs; the likely returns to increasing the pool of skills at the sector level are higher; employers would benefit most from an increased pool of sector skills and should contribute to it; employers are best placed to define skill needs within the pool and a sectoral approach reduces the impact of poaching. It is because not all of these benefits are currently realised, that State intervention is justified.

This report considers the current situation of the energy and utilities sector in the UK, the challenges it faces over the medium term and the implications for skills. The intention is to provide a summary of the extent to which the performance challenges faced by the sector can be addressed through skills development and thereby bring about growth and contribute to the recovery of the UK economy. A strong energy sector provides the products and services that are essential to modern living. An efficient sector underpins a productive and sustainable economy. A diverse sector is strategically vital for the UK to improve its balance of trade and reduce its dependency on overseas energy sources. The energy sector is at the forefront of the development of a low carbon economy. The energy and utilities sector consists of three main areas of business activity, which have shown quite different development trajectories in recent years: Mining and oil and gas extraction: which employs more than 100,000 people, although numbers declined in mining, quarrying and oil extraction during the 2000s. Recycling/Materials recovery: a growing sub-sector, which developed from contractor services for local authority run waste collection, and employed 23,000 people in 2010. Electricity and other utilities: this subsector is dominated by large scale regulated providers for electricity, gas and water utilities, employing almost 200,000 people in 2010.

The present work proposes a novel methodology for the measurement of investment in human capital in the form of training. Differently from existing studies, the expenditures-based approach pursued encompasses investment in formal and on-the-job training, as well as in informal learning and yields estimates that account for both the opportunity and the direct cost of the different forms of training considered. Using a wide array of data sources, including new and rich individual-level data collected through the OECD Programme for the International Assessment of Adult Competencies (PIAAC) survey as well as Labour Force Surveys (LFS) and System of National Accounts (SNA) data, the study proposes estimates of investment in training for the years 2011-2012. These cover 22 OECD countries and are provided at both the economy and industry levels. Estimates suggest that average total investment in training corresponds to 6.7% of gross value added (GVA), with investment in on-the-job training (amounting to 2.4% of GVA, on average) that are substantially in line with those of previous literature. Wide sector and country heterogeneity in the relative importance of investment in formal and on-the-job and informal learning also emerge. On average, production appears more intensive in on-the-job training (relative to other training types) than overall services, but not relative to business services only. Public-oriented services such as education and health services invest a greater (smaller) proportion of total training expenditure in formal (on-the-job) training than other sectors and the overall economy.

This paper addresses the following question: does Canada’s ‘inclusive’ Innovation and Skills Plan outlined in the 2017 Budget also constitute an ‘automation plan’? To this end, this paper has engaged in a benchmarking of the Trudeau Government’s Innovation and Skills Plan as outlined in the 2017 Budget against the three pillars of an ‘automation plan’, as collated from the global literature on automation. At the outset, David Ticoll’s labour obsolescence analysis is deemed the most appropriate methodology to guide policymakers’ assessments the threat of automation. The three pillars of an ‘automation plan’ include initiatives aimed at creating new jobs via innovation policy, supporting skills modernization via training and education policies, and supporting the displaced via transforming the social safety net. The first pillar is only partially fulfilled, as measuring the true extent of the threat of automation through labour obsolescence analysis is missing from the 2017 Budget’s considerable focus on creating new jobs via innovation policy. The second pillar is also only partially fulfilled, as the Budget’s prioritization of skills modernization did not include efforts to bridge the private-public sector data gap on the diffusion/impact of automation technology. The third pillar - policies aimed at supporting the displaced via transforming the social safety net - was the least fulfilled in the Budget, as transformative initiatives such as universal basic income were largely ignored. This exercise yields the conclusion that Canada’s ‘inclusive’ Innovation and Skills Plan as outlined by Budget 2017 presents a policy package more in line with an ‘Innovation and Skills Plan’ aimed at capitalizing on the upside of innovation, while only partially constituting an ‘automation plan’ designed to manage the disruption of automation.

Through its green jobs initiative, BLS has developed its green jobs definition and published information on green careers and results from three new data collection activities that measure the number of green jobs that produce green goods and services and the number of jobs related to the use of green technologies and practices.

Hotter years are associated with lower economic output in country-level data. We show that the effect of temperature on labor is an important part of the explanation. Using high-frequency micro data from selected firms in India, we find that worker productivity on hot days declines by 2 to 4 percent per degree Celsius. Sustained heat also increases worker absenteeism. Using a national panel of manufacturing plants, we find similar temperature effects on output and show that these can be fully accounted for by reductions in the productivity of labor. Estimated effect sizes are consistent with studies that rely on country GDP panels.

As the transformational impacts of technologies continue to play an increasing role in our lives, a better understanding of the social, economic, legal and environmental impacts of emerging and digital technologies is critical to optimizing their use, and to ensuring equitable access to meet the needs of Canadians. These issues are explored in addressing the question “How can emerging technologies be leveraged to benefit Canadians? ”as one of six future challenge areas identified in the Social Sciences and Humanities Research Council’s (SSHRC) Imagining Canada’s Future initiative. In 2016, social sciences and humanities researchers from across Canada were invited to address this question through an open call for proposals, with a focus on identifying key strengths and gaps in current knowledge related to the impacts of emerging technologies across multiple sectors of society. This report draws on the findings of their 24 knowledge synthesis reports, as well as on insights from exchanges among researchers, graduate students and cross-sectoral leaders. Overall, the researchers’ findings call for future research to be increasingly interdisciplinary and longitudinal. Meaningful and inclusive dialogue about emerging and disruptive technologies among and across communities, individuals, researchers, industry and all levels of government is critical to building upon and applying resulting knowledge.