16.2 The Political Economy
of Skill Formation
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While there is substantial diversity in national systems and traditions of training
and development, the globalization of markets and the internationalization of
production represent common driving forces that have led international organiza-
tions like the ILO and OECD to emphasize training and development. The OECD
Jobs Study( 1994 a, 1994 b) was particularly inXuential, arguing that the major cause
of rising unemployment and the incidence of low-wage jobs was the gap between
the need of OECD economies to adapt and the ability of governments to imple-
ment the necessary changes. TheJobs Studyrecommended measures to combat
unemployment including macroeconomic policies promoting growth and job
creation; technological development and entrepreneurship; increasing labor mar-
ketXexibility; strengthening active labor market policies; and improving labor
force skills. Subsequent OECD reports called for increasing the knowledge base
and innovative capacity through upgrading workforce skills, noting that on average
in OECD countries between 15 and 20 percent of school leavers have no qualiWca-
tion and 20 percent of the working population is functionally illiterate, whilst skill
thresholds and earnings diVerentials (related to educational attainment) continue
to rise.
Strongly inXuenced by the OECDJobs Strategy, supra-state organizations have
developed and coordinated regional training strategies. A comparison of the
training strategies of the EU and APEC shows very diVerent political structures
adopted in the two organizations and contrasting approaches to supranational
coordination of training (Haworth and Winterton 2004 ). The two regions face
common challenges arising from globalization and both the EU and APEC iden-
tiWed training as an essential component of raising competitiveness. Each region
has considerable diversity in terms of the economies of member countries which
gives the global challenges diVerent meanings in diVerent contexts and restricts the
development of uniform strategies across the regions. Despite these apparent
similarities, there are fundamental diVerences in organization and underlying
objectives. APEC’s organization is based on consensual decision-making, essential
for the Asian economies, while EU policy is directive to create an integrated
market. The means by which training policies are developed and implemented
also diVer. Social dialogue is a deWning principle of the EU policy approach that
combines economic and social objectives whereas in APEC the trade unions play
no role in developing regional training policy.
The strategies of the OECD, ILO, and supra-state organizations give the impres-
sion of a universal consensus that training is the essential component for develop-
ing modern competitive economies. Yet at the level of nation states not only is there
326 jonathan winterton