Akava on the OECD study: The weakening of skills may crash GDP growth

News article

Akava states that the quality of education and its upkeep must be at the centre of growth policy.

According to the OECD, permanently weakened skills may have a very significant impact on economic growth, but it takes decades before the results are visible.

The OECD examines the skill differences of countries as based on their PISA results. Young Finns’ average PISA scores in mathematics and science dropped by 23.5 points between 2006 and 2012.

– If this weakening is permanent and reflects on adult skills, the OECD results suggest that Finland’s economic growth may slow by 0.46 per cent per annum in the long run. By the turn of the century, the Finnish gross domestic product (GDP) would be 25 per cent lower than if the drop in skill level had not happened, says Chief Economist Eugen Koev.

25 per cent of the current GDP is about 52 billion, or 9,500 euro per Finn. Taking into account the difference in price level, that is more than the income difference between Finland and Spain, but it does not drop Finland quite to the income level of Greece.

– How great is the risk that the educational cuts might cause the weakening of skills, as demonstrated by the PISA results, to grow and deepen in the next phases of education? And what would it mean in terms of economic growth? Koev asks. 

We need more precise information and analyses

There is not enough research data on, for example, the solutions made in basic education, the impact of free choice in upper secondary schooling or the focusing of university cuts.

The Ministry of Finance wields far-reaching power when justifying the cuts, for example, by saying that “universities are bloated and better efficiency and quality are required”. Claims like this do not provide universities with the knowledge of what they should do with less money.

– Significant choices have been and are being made by parties that are not experts on education policy or education. Education policy is open game for civil servants, politicians, special-interest groups and economists when there is no research data and open discussion concerning the application of information, wonders education policy expert Ida Mielityinen.

Akava demands that education policy decisions and goals that cover multiple terms of government be supported by extensive research data and impact assessments.

– Instead of walkovers, we desperately need more precise information and analyses on what should be done and what should be left undone at each level of education. Or we need to know how education should be developed and where you can create savings without damaging the quality of education and skills, Mielityinen says.