The Skills that Matter in the Race Between Education and Technology
The threat of automation implies a race between education and technology. In most developing countries, education systems are not providing workers with the skills necessary to compete in today’s job markets. The growing mismatch between the demand and supply of skills holds back economic growth and undermines opportunity. At the same time, the returns to schooling are high in most developing countries, and growing skill premiums are evident in much of the world. Automation simultaneously results in deskilling and a need for new skills, and is changing what education will need to look like in the future.
To promote success in today’s labor market, countries need to invest early, and then in relevant skills. Education systems that do well prepare children early on, reform continuously, and use information for improvement. High returns suggest it makes sense to expand higher education as well. The three biggest policy priorities for governments, investors, and the development community include:
- Focusing on basic skills, early childhood development (ECD), and measuring and improving early reading
- Giving opportunities to workers to invest in relevant skills that make them benefit from, and remain immune to, automation
- Using evidence from labor market returns to education to implement financial innovations— and use future earnings to finance higher education
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