China’s dream of smart economy must ‘get past talent gap’

Move towards ‘value-added’ economy is being held back by mismatch between what workers are taught and skills employers want, survey finds

PUBLISHED : Friday, 04 November, 2016, 8:03am
UPDATED : Friday, 04 November, 2016, 8:03am

The mainland faces a talent gap in fulfilling its ambition of moving up the value chain of the global economy, according to a survey released in Beijing on Thursday.

There was a big mismatch between the education given to the labour force and the skills demanded by its employers, which could cripple efforts to move from low-end manufacturing to high-value-added businesses, according to the survey. It was conducted over the last year by JPMorgan and Tsinghua and Fudan universities.

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It also pointed to inadequate vocational training for the mainland’s 260 million migrant workers as a serious problem.

The mainland aims to become an innovation superpower, and sees services as a pillar for sustained growth. These plans depend on a highly skilled workforce.

However, its “low-skilled workers are not ready for automation and intelligent production, while the skills of high-skill workers are not what firms really need,” a concluding report on the survey said.

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“A fundamental problem is that school programmes, courses and enrolments are determined by higher educational institutions without a proper consideration of market demand,” the report said.

Official data show that the employment rate for university graduates has stayed above 70 per cent for the past 14 years. But the survey showed that nearly one third of graduates quit their first jobs within six months, and about 70 per cent of employers polled said the education offered by universities “has little value”.

“Though universities have expanded enrolment in recent years, there are still problems that they cannot meet corporate demand for talent,” said Li Qiang, a Tsinghua professor of social science who led the study.

The survey also found that nearly all companies polled reported a shortage of talent with global management skills.

Li said the central government should give more freedom to universities to plan courses based on market needs, and that vocational associations should focus on education for migrant workers.

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The survey showed that the younger generation of migrants coming to cities from rural areas lacked access to skills training.

One third of migrant workers had skills training, and less than 6 per cent had been granted skill certificates. Expenditure for advanced vocational education only amounted to about one third of government spending on universities, Li said.

Meanwhile, industrial associations – “bureaucratic agencies set up by retired officials” – had failed to play a role in skills training, he added.