Study of Human Capital in Poland

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1 Study of Human Capital in Poland 2011 Report concluding the 1st round of the Study conducted in 2010 Study of Human Capital in Poland Szymon Czarnik Maja Dobrzyńska Jarosław Górniak Magdalena Jelonek Karolina Keler Marcin Kocór Anna Strzebońska Anna Szczucka Konrad Turek Barbara Worek HUMAN CAPITAL NATIONAL COHESION STRATEGY EUROPEAN UNION EUROPEAN SOCIAL FUND

2 Report concluding the 1st round of the Study conducted in 2010 Study of Human Capital in Poland Szymon Czarnik Maja Dobrzyńska Jarosław Górniak Magdalena Jelonek Karolina Keler Marcin Kocór Anna Strzebońska Anna Szczucka Konrad Turek Barbara Worek Polska Agencja Rozwoju Przedsiębiorczości / Polish Agency for Enterprise Development Warsaw 2011

3 The Study of Human Capital in Poland project is conducted by its research team composed of: Department of Human Capital Development, Polish Agency for Enterprise Development: Anna Świebocka-Nerkowska project manager Maja Dobrzyńska Beata Michorowska Centre for Evaluation and Analysis of Public Policies at the Jagiellonian University in Kraków: Professor Jarosław Górniak project manager Dr Szymon Czarnik Dr Magdalena Jelonek Karolina Keler Dr Marcin Kocór Katarzyna Stec Anna Strzebońska Anna Szczucka Dariusz Szklarczyk Konrad Turek Dr Barbara Worek Publication co-financed by the European Union from European Social Fund. This publication is free of charge. The views and opinions presented in this publication do not reflect the position of the Polish Agency for Enterprise Development but only the views of the authors. Copyright by Polska Agencja Rozwoju Przedsiębiorczości Copyright by Uniwersytet Jagielloński Publisher: Polska Agencja Rozwoju Przedsiębiorczości / Polish Agency for Enterprise Development ul. Pańska Warszawa, Poland phone: fax: translation: HOBBiT Piotr Krasnowolski ISBN st edition Warsaw 2011

4 Table of contents Introduction 6 Main conclusions 8 Chapter 1. Human capital (Jarosław Górniak) 15 Chapter 2. Competencies as an indication of human capital (Anna Strzebońska, Maja Dobrzyńska) Competencies: understanding and types Characteristic features of the notion of competencies in the BKL Study Competencies how to measure them? 33 Chapter 3. Methodology of the study (Karolina Keler) Study of the employers Study of the job offers Study of the population of working age Study of people registered as unemployed in labour offices Study of students of upper secondary schools Study of students of institutions of higher education Study of training institutions Analysis of careers in education 49 Chapter 4. Diagnosis of human capital in Poland (Konrad Turek) The educational paths of the Polish people Competences of the Polish people Remuneration and expected earnings vs. the individual s resources Feminine and masculine educational and occupational profiles The situation of the elderly Untapped human capital resources in Poland the unemployed and their plans 96 Appendix 105 Chapter 5. Diagnosis of competency shortages and gaps (Szymon Czarnik, Marcin Kocór) Demand for new employees Balance of employee demand and supply Competency shortages 119 Appendix 137 Chapter 6. Development of human capital in Poland: the main challenges (Magdalena Jelonek, Anna Szczucka, Barbara Worek) Upper secondary education being (continuously) reformed Institutions of higher education Adult education 164 List of charts, tables and figures 184 3

5 4

6 We are presenting you with the results of the first round of the survey, conducted in the second half of 2010 as part of the largest research project in the history of the Polish Agency for Enterprise Development (Polish acronym PARP) under the name Study of Human Capital in Poland. The idea of the project was born in PARP in 2007 as a reaction to the deficit of information experienced while programming interventions in the area of improving the adaptive quality of Polish enterprises, especially of the SME sector, co-financed from the European Social Fund. The challenges faced by the Polish economy, and notably Polish businesses, are strongly associated with the quality of human capital they have and they will have at their disposal in the nearest future. It is thanks to the knowledge, competences, and involvement of their employees that firms can be innovative, competitive, and meet the challenges that the continuously transforming market puts them against. A public intervention in the area of adaptive quality of Polish businesses must therefore be conducted in such a manner as to assure them the necessary working hands and to adjust the competences of the employees they have to the changing conditions of economy. The correctness of public policies hinges on the availability of information that allow identification of problems, definition of their scope, and formulation of concepts of interventions leading to their solution. Therefore, it is necessary to be furnished with complex and repeated studies informing about the employers need for specific employees. With the above in mind, the Study of Human Capital in Poland project was planned as a multi-aspect review of supply and demand of competencies in the labour market to be repeated for five successive years. Speaking their minds during these five rounds will be over 350,000 respondents, representing every group that influences the shaping of competences in the labour market employers, employees, the unemployed, students of institutions of higher education, upper secondary school students, and also representatives of training institutions. The size of the investigated groups and the comprehensive spectrum of information conveyed makes the project something more than just a survey. It can be the starting point for the creation of public policy, especially in the perspective of establishing new national development strategies and the new financial perspective, or channelling the actions of public institutions on the tasks that will aid in quick complementation of the diagnosed competency gaps. I would also like to encourage entrepreneurs to use the results of the studies, especially in the context of planning recruitment and training activity in firms, as well as training institutions to build their range of educational services addressed both to entrepreneurs and to mature Poles. I hope that the results of the first round of the study, which we are delivering to you today, will provide the grounds for a material discussion concerning recommendations in the development of human capital and their possible coming into force. I trust that the research conducted will be useful for your institutions and you will be able to use it in your operation. Taking into account the fact that this report provides the conclusions from the first of the five rounds of the study, I encourage you to comment upon the results and share with us or your comments and observations, so that the subsequent rounds may be even better in answering your information needs. We invite you to the project s website to independent analyses of the data gathered there and to contact with the research team. Bożena Lublińska-Kasprzak Chief Executive Officer of the Polish Agency for Enterprise Developmenti 5

7 Introduction Introduction 6 We hereby deliver to our readers the report summing up the first round of research, conducted as part of the Study of Human Capital in Poland project. This publication is especially important from the perspective of the series of five studies planned in the project, which is reflected in the specific structure of the report. It is divided into two parts theoretical and empirical. The first of them presents the concept of human capital, which we followed while working on the design of the study. The initial results presented during the meeting with experts raised both interest and many questions concerning the understanding of competencies as applied during the studies. The question was embarked on in Chapter 2 we present the sources we used to classify the competences and the way of measuring these competences, which after many trials was implemented in the studies. Defined in the same Chapter 2 are the crucial notions used to present the results, e.g. the understanding of occupational groups and differences between the notions of occupations and jobs, and also differences between competences and qualifications. Chapter 3 is the description of the methodological concept which was used for the study and allowed the entire multi-aspect research project to be encompassed. The second part of the report is of an empirical character it presents the most crucial results concerning human capital in Poland and aims at combining the conclusions from various research modules. Chapter 4 is the first diagnosis of human resources capital owned by Poles to be so extensive at the national scale. It contains the answers to a number of key questions that were posed while designing the research. First, it presents the educational paths of the Polish people explains what the plans of students of institutions of higher education and the students of upper secondary schools are as far as continuation of learning and/or entering the labour market is concerned, and generally what the quality of education of Polish society AD 2010 looks like. In this context, it was important to present the data concerning the additional and later education of Poles on what the concept of lifelong learning practically looks like. This is followed by the presentation of the competency resources that can be used in the labour market. Another question that the reader may find an answer to in this part is remuneration expectations and how the assessment of competences in hand influences those. From the perspective of research, it turned out that one of the most important factors that influence the shape of the labour market and the situation of various people within this market is the breakdown by genders women and men, and feminine and masculine occupations which is also presented in the chapter. Closing, we show how the age influences the competence resources in hand. The following chapter embarks on an attempt at combining the results acquired from individual studies conducted in the project. It primarily presents the balance of supply and demand for specific employees, which allowed the problem areas within the Polish labour market to be identified. Moreover, it turned out that a large share of employers found it difficult to find employees in certain occupations, which was predominantly related to the lack of appropriate candidates. Presented are the competence gaps that the employers find most significant, while a comparison of the opinion of the employers with that of the jobseekers makes it possible to point to plenty of competence gaps that exist in the labour market. A summary of the entire empirical part but also the first study report is Chapter 6, which presents the greatest challenges that institutions supporting the labour market face together with the employees and other individuals responsible for the shape of the Polish labour market. Due to the amount of gathered data and, at the same time, limitations of space, we want to make it clear that the report is only an attempt at gathering the most important conclusions stemming from various research modules and the compilation of key information concerning the demand and supply sides of the labour market. All readers interested in more detailed data are encouraged to become familiar with thematic reports devoted to individual subjects of the study: employers (M. Kocór, A. Strzebońska, What employees are sought by Polish employers?, PARP 2011), adult Poles active in the labour market (S. Czarnik, K. Keler, A. Strzebońska,

8 D. Szklarczyk, Polki i Polacy na rynku pracy / Poles in the labour market, PARP 2011), the unemployed registered in labour offices (K. Turek, The unemployed the untapped resources of the Polish economy, PARP 2011), students in the last grades of upper secondary schools (A. Szczucka, M. Jelonek, Who is taught in Polish schools, PARP 2011), and the students of last year of bachelor and master degree studies (M. Jelonek, Students the future forces of the Polish economy, PARP 2011). A separate and fully exhaustive work is the report devoted to the Polish market of training firms and institutions (B. Worek, K. Stec, D. Szklarczyk, K. Keler, Who educates us when the school is over?, PARP 2011), which being the first such extensive a study of the subject deserves separate treatment. To everyone interested in the description of the research method and for people looking for practical solutions in the area, we recommend our methodological report (K. Keler, Bilans kapitału ludzkiego raport metodologiczny / Study of Human Capital in Poland methodological report, PARP 2011), and the research tools that can be found on the project website We also suggest that people who would like to study the obtained results independently visit the project website which will provide access to the databases with the main results and an online tool for independent data analysis. Introduction 7

9 Main conclusions Main conclusions Educational paths The research reveals a high level of educational aspirations of young people and the general quality and perception of easy accessibility of university studies. No fewer than 87% of students planned further education. The preferred form of continuing education was higher education studies, which was planned by approximately 70% of all the students. Such a situation can potentially give rise to the problems of (a) overeducation, that is the excessive supply of people with higher education when compared to the actual demand of the market, (b) diminishing importance of a university diploma in the labour market. Most of the student respondents assessed that they had made a correct decision selecting their university and degree subject, and not any other. A decided majority (80%) of students expected that they would find employment in line with the area of the studies. The extremely low participation of adult Poles in lifelong learning is a major problem. Only 13% participated in courses, training, and other forms of training in the last two months, and 81% did not use any form of education during the previous year, not even self-education. Only 6% continue learning (during the past year and planning it for the coming year). Competences 8 The basic determinant of self-assessment of competences was education. People with higher education assessed their competencies at decidedly the highest level. Executives and professionals assess their skills highest, and people performing various elementary occupations and unskilled workers the lowest. The individual occupational groups achieve results higher than average, especially in the case of these competences that are related to the given type of work, namely: managers stand out in managerial skills and (at par with professionals) in cognitive; information professionals and technicians in computer skills; clerical support workers in office skills; craft and related trades workers, and plant and machine operators, and assemblers in technical. In all the competence classes, the unemployed registered in labour offices assessed themselves slightly below the people currently working. These differences were diminishing with the subsequent levels of education of the groups compared. The largest and prevalent deficits of the unemployed were present in the managerial, technical, mathematic, work self-organisation, and office skills. The competency assessment between age groups differed most in the case of computer competencies. The younger generations as well as secondary school students and students of institutions of higher education clearly diverged here from the general population. Competences related to the use of computers and the Internet were assessed most poorly by people 55+. This is a visible effect of the generation difference, and the IT revolution of the recent decades. The younger generations are growing and receiving education in an information world. In this scope, students find high competences something quite natural and necessary, not unlike the ability to read and write.

10 Remuneration and expected earnings Main conclusions Among students, relatively lower salaries are expected by graduates of courses including social welfare, education science and teacher training, services for people, humanities, agriculture, and journalism. Students of the courses including artistic education, law, information and communication technology, engineering, technologies, production and processing, veterinary medicine, transport services, architecture and construction, protective care, and environmental protection value themselves definitely higher. There is a high correlation between the remuneration expected by the unemployed in specific occupations they would like to work in and the realistic earnings in these occupations. The lowest pay that the unemployed would agree to work for is on average PLN a month. The highest remuneration aspirations and real salaries were present in professional occupations in science and engineering, and also in business and administration. Standing at the other end of the scale are people employed in elementary occupations. The remuneration of people working in the Mazowieckie region was highest, and it was lowest in Świętokrzyskie, Podkarpackie, Kujawsko-Pomorskie, and Lubelskie. At the level of regions, lower unemployment is usually accompanied by higher remuneration expectations among the unemployed. The data reveal significant disproportions in payment and expected earnings between women and men. In the case of the unemployed, women have decidedly lower remuneration aspirations than men, irrespective of education, self-assessment of competences, and the type of work sought. The earnings of women working full-time are on average only at 80% of those of men. Higher education and higher assessment of competences translates into higher remuneration aspirations and earnings. Feminine and masculine profiles of education and occupational groups In most analyses both concerning various forms of employment of staff, occupations performed and these in which employment is sought, and also in the analyses devoted to education, self-assessment of competences, and educational paths, what moves decidedly to the fore is the segmentation of the labour market by gender. This differentiation begins to be clearly visible already at the level of upper secondary schools, and is later reinforced at the level of higher education, finally taking the shape of the feminine and masculine segments of the labour market. The feminine courses provide education for no less than 51% of students. The degree courses that are clearly feminised, with over 70% of students being women, include: social welfare, education science and teacher training, medicine, biological sciences, courses related to services for people, humanities, veterinary sciences, and social sciences. Men are the decisive majority only in the courses in information and communication, transportation, and also engineering and technology. 44% of students degree courses whose gender structure, though dominated by women, is fairly balanced. Significant occupational groups that are typically masculine and typically feminine can be distinguished. Feminine occupations include specialists in teaching and education, personal care, cleaners and helpers, secretaries, health professionals, customer services clerks, legal, social, cultural and related associate professionals, and health associate professionals. The typically masculine occupations include construction workers, metal, machinery and related trades workers, labourers in mining, construction, manufacturing and transport, stationary plant and machine operators, science and engineering associate professionals, protective service workers, electrical and electronic trades workers, information and communications technology professionals, and information and communications technicians. Both in the masculinised and feminised professions, men earned visibly more. The women s occupations were as a rule paid less. 9

11 Main conclusions The untapped resources of the Polish economy the unemployed and their plans According to the data from the research conducted as part of the BKL Study, approximately 8% of the population declared themselves to be unemployed and jobseekers. The highest unemployment rates were recorded in Podkarpackie, Warmińsko-Mazurskie, and Świętokrzyskie, and the lowest in Wielkopolskie, Podlaskie, and Mazowieckie regions. Most of the long-term unemployed lived in the eastern regions, that is in Podkarpackie (40% of all the registered unemployed in the region were long-term unemployed), Warmińsko-Mazurskie (33%), Podlaskie (31%), Lubelskie, and also in the Kujawsko-Pomorskie. The occupations mentioned most often among the ones in which the respondents sought employment included: occupations related to sales and services (27%) primarily salespeople, cooks, hairdressers, point of sale operators, waiters, and beauticians craft and trade occupations (18%), including mechanics, masons, toolmakers, welders, carpenters, electricians, tailors, bakers, and confectioners elementary occupations (15%), including construction workers, physical workers, helpers (also kitchen aid), cleaners, caretakers office and related work (14%) among others clerical support workers, warehouse workers, and secretaries. The type of employment sought to a great degree depended on the level of education. Among people with lower secondary and lower education no fewer than 36% sought employment in elementary occupations. Among people with basic vocational education, Craft and related trade worker occupations (37%) were more popular than in other groups. Among the people with higher education there was a clear oversupply of potential professionals as many as 55% were seeking work in professional occupations. Nearly 60% of the respondents who previously were employed on job contracts were seeking employment in the same group of occupations (according to ISCO -1) in which they had been employed before. Approximately 28% of the respondents considered the option of begin their own business. These were more often men (32%), people aged 25-34, and people with higher education. Nearly three quarters of the respondents were ready to retrain for a new occupations, with young people being somewhat more likely to do it. A vast majority of the respondents seeking work (92%) would like to find full-time employment. Only every 10th considered a part-time job as an option. Every tenth respondent registered as unemployed in a labour office had worked without a formal job contract during the preceding year. Working in the black economy was popular primarily in the Świętokrzyskie, Podkarpackie, and Podlaskie (15%), Łódzkie (14%), and Śląskie (13%) regions. Nearly two thirds of the unemployed working in the black quoted the reluctance of the other party as the reason for the lack of a formal contract. External reasons, e.g. lack of appropriate job offers (61%). Besides the above, the respondents complained about lack of contacts and acquaintances (49%), and also shortages in their own resources: unsatisfactory experience (33%), lack of certificates and permits (29%), and insufficient level of education (20%) belonged to the factors and situations that were most often mentioned as obstacles in entering employment. The lack of appropriate job offers was pointed to as a barrier primarily in the following regions: Podlaskie (87% of answers), Podkarpackie (85%), and Łódzkie (81%); the problem turned up decidedly least often in the Pomorskie (37%) and Śląskie (43%) regions. 10

12 Employees sought Main conclusions In the last quarter of 2010, only every sixth (17%) employer was looking for new employees. The largest demand was present in three groups of occupations. These are: skilled workers: mostly drivers and mobile plant operators (i.e. drivers of heavy goods vehicles, operators of heavy equipment, and bus drivers), construction workers (mostly masons, roofers, floor layers and tile setters, and fitters of sanitary installations and devices), metal, machinery and related trade workers (mostly welders, operators of numerically controlled machines, and car mechanics) sales professionals, health professionals (mostly nurses, pharmacists, and general practitioners), science and engineering professionals that is primarily architects, surveyors, and designers, electricians; information and communications technology professionals mostly application programmers; legal, social and cultural professionals mostly lawyers, professionals in scientific information, technology, and economy, and journalists; and teachers at various levels, but primarily English language teachers, preschool teachers, and teachers in educational and care facilities service workers: salespeople, cooks, waiters, hairdressers, and call centre employees. The balance of supply and demand also proves that in the case of qualified workers and professionals, there is a clear maladjustment of the structure of supply and demand that suggests the lack of sufficient number of hands and minds to work. This is true, especially in the case of health professionals, construction workers, and drivers and mobile plant operators. Difficulties in finding appropriate staff result primarily not from the lack of people willing to perform the jobs but rather from the lack of appropriate competences mostly occupationrelated, but also general. The analysis of education required by the employers for individual jobs proves that the problem of lack of appropriate qualifications among the potential employees may be a significant problem, and may limit the market opportunities, especially of the older generation. Yet it is to be emphasised that the problem may also be too high a level of education. In some occupational groups (e.g. associated with clerical support) employers, especially smaller businesses, express reluctance to employ people with higher education. Development of human capital: the main challenges The following must be mentioned among the key challenges facing education above lower secondary schools: The unsatisfactory level of (actual) differentiation of paths in education at levels higher than lower secondary. The investigations proved a general growth of aspirations among young people, as 87% of them declare themselves to continue education after completing the current school. At the same time, the investigation proved a very clear domination of the general path among the choices made by students (nearly half ) and the marginalisation of the intermediary path between vocational and general education, that is the specialised secondary schools. A great majority of students (three quarters) are planning to continue education on to the level of higher education. This proves the lack of qualitatively good alternatives towards the lower secondary school general upper secondary school academic studies path. The qualitatively unsatisfactory alternative for general education, namely, basic vocational schools. The results of the research conducted prove major differences between general vocational education in the development of key competences and the selective character of this education, gathering poorest students. Inequalities in the access to various forms of education and opportunities of continuing it. The results of the research proved dependencies between the selection of the type of upper secondary school and the education of the father, and as a consequence the selection of the educational and occupational path and lower probability of obtaining higher education in the case of children whose fathers have primary education, as compared to the children of fathers who completed higher education. The presence of qualifications and competence shortages is an effect of the maladjustment of supply to demand in the labour market. Among the key qualifications and competence shortages identified in the study, the following should be pointing to: 11

13 Main conclusions The threat of occurrence of qualification maladjustment in the group of craft and related trades workers, with a special focus on construction workers. In the employer study it was discovered that employers seek primarily employees who belong to the group of qualified workers and craftspeople, and especially construction workers. And yet the structure of education in the occupations in that subgroup does not fully reflect the structure of that demand. This phenomenon is intensifying parallel to the decrease in the absolute number of graduates of vocational education and their improvement of qualifications through further education, which results in an outflow of people from these occupations. Maladjustment of the supply and demand of competency-related character among workers, associate professionals, and personal service workers and sales workers. These groups found themselves among the occupations sought after, where it is most difficult for the employers to find employees. The reason for this situation is the failure to meet the expectations of the employer. The maladjustment concerns primarily vocational but also plenty of general competences. 12 The key challenges that higher education faces include: The high level of over-education of the population, which is not necessarily related to excess competences. The growing education ratio at the higher level and the high educational aspirations of the upper secondary students suggest that this trend is going to continue. At the same time, the employers declare that there are significant problems with staffing the posts with professionals, who frequently do not have appropriate competences. The excessive development of the segment of social, humanist, and education science and teacher training studies (mass education in the area) and the parallel shortage of graduates of certain technical and health studies (application programmers, nurses, and general practitioners). This level of development of the segments of social, humanist, and teaching studies is not in line with the human resources needs defined by the employers. The forecasted decrease in the number of options in humanist and social studies, and an increase in the mathematical, physical, and technical, as attested by the declarations of students of schools higher than lower secondary, in reference to the future selections of education careers a similar percentage of students declare to selecting in future a course in physics, mathematics, or technology as in law, and social and cultural sciences. Strong maladjustment of sales to demand in professional occupations, yet to a greater extent of the type of competence gaps and to a lesser one, of qualification gaps. Among the key gaps identified in this study, the following should be pointed to: in the case of specialists in teaching and education competence shortages concerning communicativeness, independence, creative skills, availability, attention, diligence, precision and care for detail in the case of business and administration professionals gaps in occupational competences, including the skill of assessing the financial standing of the enterprise, knowledge of questions of the clearing process, the application of the act on public finances, knowledge of marketing tools, knowledge of tax regulations, and knowledge of the law of public procurement in the case of information and communications technology occupations, responsible for the competence gaps is the structure of specialisation in information and communications technology studies that is not adjusted to the demands of the labour market. Significant gaps in qualifications have been identified in the occupations classified in the group of health professionals. According to the declarations of the employers, health professionals (mostly nurses, general practitioners, and anaesthesiologists) currently belong to the group of employees who are most difficult to find. The low level of knowledge and awareness of what competences are, in the group of students and also problems with adequate self-assessment of the level of skills, which is attested by the large divergences in the assessment of competences by experts (employer valuation) and future professionals that is students of the last years of institutions of higher education (self-assessment). One of the reasons behind these divergences may be the lack of sufficient market information as well as the underdeveloped sense of occupational consulting.

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