25th Anniversary Celebration

of the Faculty of Organization and Management

Technical University of Lodz, Poland

22nd April , 2016

Employability and Entrepreneurial Skills of Graduates

to meet current economic challenges

Elisabeth T. Pereira, PhD Department of Economics, Management Industrial Engineering and Tourism

University of Aveiro (Portugal)

http://www.ua.pt/degeit/#

With the Bologna Process reform, employability of graduates is a

central concern in Europe and a key objective, reinforcing the HEIs’

role in the knowledge and skills needed to ensure students and future

graduates’ employability.

The employability performance of HEIs graduates is used to

• Ranking systems of HEIs

• Promote the university and attract new students.

• influence the level of HEIs receive funding in some countries (like Czech

Republic, Finland, Greece, Italy and Slovakia), or to calculate the number of

vacancies of each graduation.

So, Employability has become one of the central objectives of the HEIs.

Current European Challenges : Bologna Process

• Europe faces a moment of transformation…

The crisis has wiped out years of economic and social progress and

exposed Europe's economy to structural weaknesses.

The recent economic crisis has no precedent in our generation.

EU GDP fell by 4% in 2009, industrial production dropped and 23 million people were

unemployed. (10% of EU active population).

In the meantime, the world is moving fast and long-term challenges –

globalisation, pressure on resources, ageing – intensify. The EU must now

take charge of its future.

Current European Challenges

• Europe must improve in the fields of:

– Innovation: R&D spending in Europe is below 2%, compared to 2.6% in the US

and 3.4% in Japan.

Europe needs to focus on the impact and composition of research to improve the R&D.

EU smaller share of high-tech firms explains half of EU gap with the US.

– Education, Training and Lifelong Learning: A quarter of all pupils have poor

reading competences, one in seven young people leave education and training too

early. Around 50% reach medium qualifications level but this often fails to match

labour market needs. Less than one person in three aged 25-34 has a university

degree compared to 40% in the US and over 50% in Japan. According to the

Shanghai index, in 2015, only 4 European universities are in the world's top 20. http://www.shanghairanking.com/ARWU2015.html

– Digital Society: Europe is also falling behind on high-speed internet, which affects

its ability to innovate, including in rural areas, as well as on the on-line

dissemination of knowledge and on-line distribution of goods and services.

Current European 2020 Challenges Overview

Androulla Vassiliou

European Commissioner

for Education, Culture,

Multilingualism,

Youth and Sport

Current European 2020 Challenges

“Because we need change in Europe. We are facing considerable

challenges – challenges too big to be dealt with by any one country

acting alone: the economic crisis; unemployment, especially for young

people; changing demographics; the emergence of new competitors;

new technologies and modes of working. Europe can no longer rest on

its laurels. We need to become more outward-looking, more innovative,

and to put our societies on a sustainable footing for the future.”

• Europe 2020 define the EU's growth strategy for the coming decade

and intends to turn the EU into a smart, sustainable and inclusive

economy delivering high levels of employment, productivity and social

cohesion.

• To achieve this goal the EC defined seven flagship initiatives that affect

direct or indirectly HEIs and their graduates, but 3 of them have a

direct impact in HEIs future policies and graduates prospects:

-‘Innovation Union’

-‘Youth on the Move’

- Agenda for ‘New Skills and Jobs’.

Current European 2020 Challenges: Europe 2020

Youth on the move to enhance the performance of education systems and to

facilitate the entry of young people in a global competitive labour market.

Importance of International Student Mobility

• Promotes Employment, Entrepreneurship and Improves Career Prospects,

• Offers students broader horizons and social links,

• Is related to the significance of other transnational, cultural, socio-economic and

political processes - such as European citizenship and integration, the IT revolution,

the use of English as the global academic language

Current European 2020 Challenges: Europe 2020 Youth on the move

In http://europa.eu/rapid/press-release_IP-14-1025_en.htm

Current European 2020 Challenges :

Importance of International Mobility - facts and targets

• Erasmus+ target is offering opportunities for 4 million people to study, train,

teach or volunteer abroad by 2020.

• The EU target for overall student mobility be at least 20% by 2020

Youth on the move

• An agenda for new skills and jobs

to modernise labour markets and to stimulate and anticipate changes in the skills

needed for the future, as well as to realize a better matching between available

skills and those required in the labour market, to bridge the gap between the HEIs

and the labour market contributing to a Europe in 2020 more competitive,

sustainable and innovative economy.

empowering people through the acquisition of new skills to enable current and

future workforce to adapt to new conditions and potential career shifts, through

labour mobility, reducing unemployment and raising labour productivity.

In order to increase flexibility, adaptability, employment and social cohesion

And in 2020 at least 40% of the people between 30-34 years old have a HE qualification.

Current European 2020 Challenges: Europe 2020 Na Agenda for new skills and jobs

Current European 2020 Challenges :

Importance of Modernisation of High Education

Agenda for new skills and jobs

An overview of the market labour and employability of graduates :

Youth unemployment versus total unemployment

(June, 2014)

An overview of the market labour and employability of graduates : Table Employment rate (%) by level of educational of young adults (25-29 years)

Total

Employment rate

Less than primary

and lower secondary

Upper

Secondary

Tertiary

education Year 2008 2013 2008 2013 2008 2013 2008 2013

EU-28 75,6 70,5 61,8 51,4 75,7 71,5 84,0 78,5 Belgium 80,1 75,0 55,5 52,6 81,0 75,9 89,1 83,6 Bulgaria 75,0 61,4 47,9 29,4 79,0 64,5 87,3 73,6

Czech Republic 75,8 74,6 49,6 46,0 76,7 75,7 80,2 77,6 Denmark 83,3 72,8 75,2 56,0 85,9 77,0 88,4 79,2 Germany 74,8 77,6 54,4 54,1 75,3 78,9 87,1 86,6 Estonia 78,8 74,3 70,2 61,9 82,4 73,0 77,9 78,9 Ireland 79,6 68,5 56,0 39,9 79,1 65,0 87,5 79,4 Greece 72,9 48,7 70,7 44,1 72,0 46,5 76,0 53,0 Spain 75,2 58,1 68,5 49,7 76,4 58,0 80,3 65,8 France 78,8 74,6 60,2 51,5 79,2 73,1 86,5 83,7 Croatia 76,6 61,5 55,6 37,4 77,0 61,1 84,0 68,7

Italy 64,3 52,7 60,4 47,8 67,6 56,0 61,3 50,2 Cyprus 81,8 71,4 76,7 67,9 77,7 70,1 86,5 72,9 Latvia 79,9 76,3 62,8 60,0 80,3 73,4 89,0 85,0

Lithuania 77,3 77,3 56,0 46,9 73,7 70,5 86,8 88,5 Luxembourg 74,4 76,0 70,9 74,7 72,3 73,3 78,5 78,7

Hungary 70,7 69,0 43,6 37,2 71,5 70,5 83,1 80,8 Malta 80,9 83,3 70,2 71,5 88,7 88,0 94,9 91,2

Netherlands 88,4 81,6 74,2 65,6 89,5 80,6 93,3 88,7 Austria 79,9 80,5 60,9 57,0 82,0 83,1 84,9 84,0 Poland 76,3 73,0 52,5 39,8 73,7 70,7 85,2 80,2

Portugal 78,6 68,0 79,1 63,0 75,1 70,9 81,1 71,0 Romania 69,2 70,1 57,0 56,9 67,7 71,0 85,8 79,3 Slovenia 82,9 70,7 63,3 50,9 82,3 69,3 87,4 76,5 Slovakia 73,7 67,0 27,0 25,7 74,5 68,2 81,8 72,0 Finland 79,3 74,7 69,2 55,1 76,6 73,2 87,6 82,7 Sweden 80,6 77,6 65,7 54,2 82,4 79,8 84,1 82,5

United Kingdom 79,6 77,8 58,1 53,9 80,1 78,3 89,6 87,1

Source: Eurostat, EU Labour Force Survey (2014)

An overview of the market labour and employability of graduates :

Graduates employability in European Higher Education Institutions

Youth Unemployment rate(%)

2007 2011 2014

Portuga

l 16.7 30.3 38.1

Spain 18.1 46.2 55.5

Greece 22.7 44.7 58.3

Latvia 10.6 31.0 23.2

Poland 21.7 25.8 27.3

Source: Eurostat

An overview of the market labour and employability of graduates :

Graduates employability in European HEIs

Source: Eurostat

(http://ec.europa.eu/eurostat/statistics-explained/index.php/Europe_2020_indicators_-_education)

Although university graduates have a high employment level, it has verified

a decreasing trend since 2008

The impact of the worldwide crisis and the persistent high rates of youth unemployment, specifically

to those who recently finished their graduation, is a serious problem of EU countries in particular for

the South European countries that have recorded alarming rates of youth unemployment.

Graduates employability in European HEIs:

Concept of Employability

The importance of the concept of Employability has increased in the last

decade, mainly in accordance with the Bologna Process reform of the

European higher education system, the high rate of youth unemployment

in some European countries and the new Europe Strategy 2020.

Employability refers to the quality or possibility of having a job, taken here

in the lactu sensu of being an employee or self-employed. In this sense,

employability also refers to entrepreneurship and the ability to maintain

successfully and create jobs, either for oneself and/or for others.

Employability of graduates refers to the graduates’ abilities to adapt and

use their personal and academic skills to more tangible educational

outcome measures that associate graduate employability with employment

Graduate employability should link graduate skills and competencies to the needs of the

labour market

Graduates employability in European HEIs

Concept of Employability – an overview

Graduates employability in European HEIs

Traditionally HEIs focused only in teaching discipline-specific skills

"the employability of graduates should not be seen as the primary focus of higher

education (…) the achievement of learning outcomes in higher education should be

regarded as a value in itself" (Oria, 2012: 219).

Nowadays the relation between employability and HEIs has changed: the

current paradigm (the human capital theory) see education as essential

to the knowledge-based global economy. Employability has positive

effects at a broader economic level.

Just as castles provided the source of strength for medieval towns, and

factories provided prosperity in the industrial age, universities are the source

of strength in the knowledge‐ based economy of the twenty‐first century.

Lord Dearing, September 2002 author of the Dearing Report into Higher Education

Employability Skills

Hard Skills Soft Skills

Sctrutural Aspects

of Employability

Conjuntural Aspects

of Employability

Managing in the Labour

Market

- Strategic Approach

- Presentation (CV, …)

- Career Management ans

searching Skills

Personal

Circunstances

Employability and Skills

Skill, in its broader sense, is the ability to perform certain tasks well.

Hard skills – are in the domain of formal or technical knowledge, also

known as core skills, domain skills, and technical skills.

The formal and technical knowledge acquired during graduation.

Soft skills, are in the domain of personality, attitude and behaviour, are

also called interpersonal skills, life skills or employability skills.

Nowadays, both soft and hard skills are essential to be competitive and achieve

a successful career in current labour market.

The contextualisation of skills and competences:

Hard Skills versus Soft Skills

Soft skills are of primordial importance to employability. According to Crosbie (2005) 85% of job success is based on individual’s soft skills.

Soft skill involves personal attributes, like intellectual potential,

communication, teamwork, willingness to keep learning, easiness in decision

making, flexibility in adapting to change, problem solving, critical thinking,

creativity, initiative, self-motivation and enthusiasm, stress management, sense

of humor, and self-efficacy:

If hard skills are considered flexible and developed through training, soft skills tend

to be stable in adults.

Nevertheless, some believe that their development is a long-term and slow process, that

can be developed through individual training and programs that improve skills, in

order to change their personal attributes.

The contextualisation of skills and competences:

Hard Skills versus Soft Skills

The contextualisation of skills and competences: Skills Map

Source: University of Kent (2011)

The contextualisation skills and competences

There are Different Perspectives according time evolution

and across different cognitive domains or subject areas

- Hard skills versus Soft skills;

- Transferable skills;

- Generic skills; Transversal Skills;

- Core skills;

- Cross-curricular skills;

- Hierarchical classes versus categorical classes

….

Learning and developing activities can be provided

from different sources /institutions:

Formal education (HEIs);

Organising and structured training courses;

Personal reading and research;

Learning by doing;

Learning by observing others around you with experience;

Others

The contextualisation skills and competences

Nowadays…

• most of the persons will be working until they are 70+ years old

• today’s graduates will likely have ‘multiple’ careers during their

working life

most graduates will change roles/employers within the first 5 years after

graduation

• the labour market is changing continuously and rapidly

many of today's most sought jobs didn’t exist 10 years ago

technology is changing everything.

“Careers are a journey, jobs are just places you visit along the way”

21st Century Skills

“In market economies, product markets influence labour demand,

and skill requirements are driven by employer choices in designing

jobs (e.g. which tasks are delegated, which can be substituted by technology,

which rely on non routine tasks). Job candidates and potential employees

also come to the labour market with varying knowledge,

competencies and abilities that can be broadly defined as “skills”, or

the outcome of individuals’ choices of education, training and of

their work experience, combined with innate abilities and

preferences”

World Economic Forum Global Agenda Council on Employment (2014:7) in http://www3.weforum.org/docs/GAC/2014/WEF_GAC_Employment_MatchingSkillsLabourMarket_Report_2014.pdf

Employability and competitiveness of a graduate in the current labour market

21st Century Skills

Source: Ahonen and

Kinnunen (2015:397)

Table 1.2.4 Definition of some of the twenty-first century skills

Skills Explanation

Communication Ability to express oneself clearly and to listen to others

Problem solving Ability to perform tasks and solve problems by reasoning and bringing together

prior knowledge and experience in new ways

Critical thinking Ability to assess and relate received information by using one’s own critical

faculties

Collaboration Ability to work together with others in different groups striving for a common goal

Creativity Ability to think differently and create new objects, ideas, and methods

Information

literacy

Ability to receive, utilize, and apply information from diverse media sources

Technical

Proficiency

Ability to utilize and apply technology and ICT in various everyday life situations

Cultural

awareness

Knowledge of one’s cultural background and ability to respect and adapt to other

cultures

Social

responsibility

Knowledge of one’s responsibility toward other people and ability to consider and

treat them as equals

Source: Adapted from Ahonen and Kinnunen (2015)

21st Century Skills

21st Century Skills

European Commission (2013), The Employability of Higher Education Graduates: The Employers’ Perspective , in

http://www.dges.mctes.pt/NR/rdonlyres/658FB04A-909D-4D52-A83D-21A2AC4F2D38/8096/employabilitystudy_final.pdf

21st Century Skills

Trends, skill domains and aspects of the skills

The #EuropeHome project involving 5 European universities from

Greece, Latvia, Poland, Portugal and Spain, identify the main skills of

their graduates as well the lacks and the needs identified by three

target groups

Three target groups: Employers, Students and Academics

Fields of Business, Economics and Engineering/Computing

The project is addressed to the challenge of student employability and the need to

increase the relevance of education based on 4 main pillars:

• Employability and entrepreneurial education;

• Relevance of education;

• Employability and mobility;

• Employability and internationalisation at home

Graduates employability in five European HEIs:

#EuropeanHome project : some results

#EH - Graduates employability in European HEIs Some Results Top five essential skills and Top three of lacking skills according to all the respondents (students, employers and academics)

Source: Own elaboration

Top five essential skills and Top three of lacking skills according to all the respondents (students, employers and academics)

(answers according to a likert scale , where 1 corresponds to not important and 5 to very important).

Involving labour market actors in the design and delivery of programmes at universities,

and including practical experience in courses will help to attune the curricula to current

and emerging labour market needs and foster entrepreneurial awareness.

4,25

4,45

4,28

4,29

4,19

3,97

4,42

4,04

3,94

4,11

2,54

2,49

2,25

1,38

1,34

0 1 2 3 4 5

Prepare courses more relevant to the

labour market

Include practical tasks and assignments

in the courses

Include sector specific work placements

as an integral part of the study programme

Provide post-graduation support (facilitate

relations between graduates and

companies)

Provide on-going collaboration with the

labour market actors

Employers

Academcis

Students

#EH - Graduates employability in European HEIs Some Results

How should universities improve the employability of future graduates?

In the last decade, employability of graduates has assumed a central role in

scholars’ concerns and discussions. This was mainly motivated by the Bologna

Process reform of the European higher education system, by the high rate of

youth unemployment in some European countries, and by the new Europe

Strategy 2020 which aims a higher education based in ‘New Skills and Jobs’.

The impact of the crisis and the persistent high level of youth unemployment

have increased the need to a better understanding of future skills in the EU.

With this purpose the EU Strategy 2020 intend to mitigate the current skills

mismatches in EU labour market by stimulating and anticipating the future

skills needed and by empowering people with this right mix of skills.

The International Student Mobility reinforce the employability of graduates

in the current economic European Context

Anticipate future skills is a considerable challenge, due to the rapidly-changing

skills needed, and the persistent skills mismatches in EU labour market.

Some conclusions Graduates employability in European HEIs

• Competitiveness of graduates in labour market

obtain and maintain a competitive advantage in labour market

where only the most able adapt and survive successfully

The development of skills and competences are importance to increase

graduates’ employability, should start early and be continuously developed

“who goes to war prepares well before at home”

The adaptation and anticipation of acquisition of new skills

enable current and future workforce to adapt to new conditions

and potential career shifts, in order to increase flexibility,

adaptability, employment.

Some conclusions Graduates employability in European HEIs

Increase Competitiveness in the Current Labour Market

Universities /HEI s Labour Market

(different sources/institutions)

Knowledge, skills Employability

Interdisciplinarity

So, the importance of the improvement of skills, competences and other ways to

increase and promote employability are relevant in the transition and

competitiveness of the graduates from the HEIs to the labour market. And HEIs

should have an important role in this transition.

Some conclusions

The skills needed in the labour market must be in accordance with education taught in HEIs

but also gained outside formal education.

These include transversal skills that are highly valued by employers, such as communication,

a talent to work on projects and in teams, analytical abilities, intercultural competences, ...

Campus Europae

• To increase the employability of their graduates, HEIs have to decrease the gaps

between the academia and the labour market, providing training to teachers in non-

technical skills (soft skills) to they transmit to their students.

• Traditionally universities focus more in hard skills and the current educational

paradigm focus is now directed by the needs for employability skills (soft skills as

learning, thinking, and communication skills).

• Studies show that hard skills represent only 15% and individual’s soft skills have a

primordial importance in employability with 85% of job success.

So, hard and soft skills should be embedded in course curricula and considered in

their design and implementation.

The changes of curricula upon HEIs' views and priorities, should be done in

cooperation with all the involved stakeholders - teachers, university governors,

alumni, students, administrative staff, employers, public administration, trade

unions...- with different roles, in a dynamic process of exchange of information to

identify needs and assess their satisfaction.

Some conclusions

Some conclusions Skills and competences that allow increasing the competitiveness of a

graduate in the current labour market

Graduate Employment and Employability over Time

Labour Market Context

G l o b a l i s a t i o n

Crisis, Economic Fluctuations

New Jobs,

New Environments (politics,...),

New Technologies,

New Market Perceptions,

(…),

New Qualifications

New Skills and Competences

HEIs =>

GRADUATE

Hard skills

Soft skills (knowledge and training)

Com

pet

itiv

en

ess

in

lab

ou

r m

ark

et

Students’ and Graduates’ Perceptions and Approaches to Future Employment and Employability

New Challenges appropriate decisions and

future career development

Creativity

Innovation

Entrepreneurship

http://www.ua.pt/degeit/#