Low skills to hamper Spain, Italy revival: OECD

MADRID — Workers in Spain and Italy are the least skilled among 24 developed countries surveyed by the Organization for Economic Cooperation and Development (OECD), a deficit that is likely to impede the ability of both countries to boost their competitiveness, and enable the eurozone to overcome its fiscal crisis.

In the most extensive report on skill levels across a wide range of countries to date, the OECD also concluded that in both the United States and the United Kingdom, younger people are significantly less skilled relative to their peers than older people, while Japan and Finland boast the most skilled workers.

Most assessments of the quality of human capital available to various national economies have focused on time spent in education.

The OECD’s study is the most extensive effort to date to measure the skills acquired during education.

Singapore was not among the 24 nations surveyed.

Both Spain and Italy have suffered from a loss of competitiveness over the last decade. In order to return to strong growth while generating trade surpluses and paying off their debts, their competitive position will have to improve.

But according to the OECD, Italy ranks bottom, and Spain second-to-last among the 24 countries in literacy skills.

Over one in five adults in both countries cannot read as well as a 10-year-old child would be expected to in most education systems.

In a ranking of numeracy skills, the positions are reversed, with Spain bottom, and Italy second-to-last. That means one in three adults have only the most basic numeracy skills, a fate shared by their US counterparts.

“If you measure Spain by the number of university degrees, it looks good,” said Mr Andreas Schleicher, Deputy Director for Education and Skills at the OECD.

“But that doesn’t tell the truth. The skill base will limit the capacity to grow.”

Italy faces an even greater challenge. Not only does it have fewer highly-skilled workers than most other economies, it also uses them badly — or in the case of many highly-skilled women, not at all.

“Even the highly skilled are not well used,” said Mr Schleicher.

The UK and the US have made the least progress in improving skills over time, an indication that their economies may grow more slowly in the future than those of many other countries.

According to the OECD study, in both countries skills are below the average of the 24 nations.

In the UK, people aged 16 to 24 have exactly the same level of literacy as their grandparents, while in the US, there has been only a modest improvement over the generations.

As a result, the US share of highly-skilled workers has fallen to 28 per cent in the 16-24 age group from 42 per cent in the 55-65 age group.

“In the US, the older generation was one of the most highly skilled, but the younger generation does worse than average,” said Mr Schleicher.

However, both the US and the UK are exceptionally good at ensuring that workers’ skills are fully exploited, ensuring that their respective skills deficits do not translate into a growth gap with other leading economies.

“The US and England are very good at extracting the maximum out of their higher skilled worker force,” said Mr Schleicher.

The OECD surveyed 166,000 adults between August 2011 and March 2012.