One can agree that vocational education and training should be the responsibility of the employer, however also that the state should play a proactive role in the facilitation of this VET to ensure that the right kind of training and labour market formation takes place. In the absence of standardized tertiary education for these skills and trades, the training needs to be standardised in a uniform market to allow skills transfers ensuring maximum career progression. There needs to be a balance between the interests of the employee and that of the employer. Whilst traditionally voluntarist systems (Grugulis 2007) are linked to internal labour markets, it is arguable by way of reference to the United Kingdom as an example that it is possible to have a voluntarist system with corporatist elements (Ashton 2004) that will lead to the creation of an occupational labour market (Keep 1989). This balance of interference and an attitude of relative deference by the state is perfect combination of encouragement and facilitation. This should take the form of regulation and legislative provision for vocational training, however in certain circumstances may encompass social partnering and even funding.
The Role of Vocational Education & Training
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The idea of skills and knowledge-based competition is broadly applauded by most governments, there is as of yet so consensus as to the features of the best system of facilitating an environment to acquire these skills and knowledge (Rainbird 2002). The idea of a global system of employment and skills is still largely a myth and even in companies that are global or multi-national, there always exist local policies and regulations that will cause them to adapt their policies on VET according to the requirements of that particular labour market. This has to do with the level of intervention by the state and corresponding autonomy of companies and firms operating hereunder. Importantly to all systems of VET, there is an essential relationship between capital, labour and the state (Grugulis 2007). There are three models of VET: free market (voluntarist), corporatist and developing state models, (Ashton 2004) each with a varying degree of state control and regulation and a corresponding responsibility on the individual employee and the employer to provide VET. Corresponding to this are two contrasting forms of labour market: Internal and Occupational.
A Free Market?
“In societies characterized by the free market model, industrialization has been led by a strong manufacturing and business elite, supported by a strong state with the unions playing a subordinate role.” (Ashton 2004) In this kind of market there is a dominance of capital over labour and the state’s role is limited to one of facilitation through providing a framework for this free play of market sources. The state is generally responsible for basic education, however further socialization and training of young adults thereafter falls to the employer and individual employee – seeing further education and training taking place through work placement or at colleges (Rainbird 2002). The free market system supports the notion that VET should not be the responsibility of the state, but rather of the employer and employee. As such, certification is an option of the employer and not mandated by regulation or law, often resulting in ownership of the certification process by the firm (Ashton 2004). The principle assumption behind these markets is that business develops better when unfettered by regulation (Grugulis 2007).
A Balancing Act
There are however legitimate concerns about this model of VET. Because there is no legislative framework compelling employers to train their staff and report back on the training provided or portion of budget spent on training, accurate information about the success of training and possible room for improvement is not present (Rainbird 2002). Furthermore, training results in suitability for the particular position at the particular firm rather than a broad skills base developed for a particular vocation therefore limiting the scope of progression of the employee. It could be argued that without state mandated VET, there is less of a responsibility on employers to train their staff which could mean that it is ignored altogether or improperly facilitated. Further, in higher skilled profession there is a high rate of moving between firms which discourages these firms from offering vocational training (Grugulis 2007). The development of an internal labour market in this manner is not necessarily in the best interests of the employees or the labour market in general. It sees education and training as market based, therefore only when skills are required will employers undertake training and this in itself is not conducive to a thriving labour market. The employers will generally only undertake training to the specific needs of the role within that firm and often this may provide acquisition of highly specialist and untransferable skills. It limits the employee to their job specification within the company therefore limiting their potential career progression to that within the firm, although this is advantageous for the firm as it may dissuade deflection to competitor companies. Importantly however, because the training is firm specific there is no certification or qualification necessarily through the training providing, which is by design incredibly limiting on the employee as their skills remain firm specific. Therefore it is evident that the free model system and subsequent creation of an internal labour market is a highly capitalist approach to labour and economy, and has very limited benefit for employees in that system (Ashton 2004).
Corporatist or educational VET systems by contrast sees the state regulating the relationship between capital and labour (Ashton 2004). This creates a more institutionally dense training system, the benefit of which allows a certain standardization of certification. Whereas in a free market system, an employer generally chooses to involve themselves in the certification, the corporatist system has the state working in conjunction with social partners, the benefit of which cannot be overlooked. Working in this kind of relationship creates an occupational labour market, which is highly favorable for the employee as it provides adaptable skills and training. Whilst there is some state intervention, there is still a fair degree of autonomy for the firms in this system. In apprenticeships this creates standards which are advantageous in creating a synergistic interaction between the various VET schemes in a country. In terms of striving for a global model of employment skills and training, this corporatist model serves as a harmonious example of what can be achieved globally as it intervenes enough to create uniform employment standards, however not enough to cause the system to be too specific of the particular political, social and economic idiosyncrasies of the country. The creation of the occupation labour market benefits employees greatly with occupational qualifications and a universal certification which can allow far greater opportunity for career progression outside of the firm where they received the training (Ashton 2004, Keep 1989).
By contrast to the developing state system of VET, the free market model can also be described as comparatively unambitious. In developing state systems, there is a large degree of state control over education and training (Ashton 2004, Grugulis 2007). This is important for the purposes of nation building and allows the state the autonomy to develop new industry as it sees fit (Ashton 2004). This high level of state control however advantageous and necessary for developing nations cannot be effective in developed countries, as it will allow the state to push its own agenda without accountability. Importantly however it does allow the state to be able to make up market skills shortages by providing these apprenticeship and training programs. Like the corporatist approach, this system also creates an occupational labour market, however the downfall in a developing state system is that unqualified individuals may find it very difficult to enter the market as the industry requirements are standardized and uniform. In terms of a global outlook this kind of highly interventionist approach cannot be favorable as it is regionally specific. It is clear therefore that high levels of state intervention such as the developing state model are not ideal for most established economy and therefore this specialist model cannot be said to have general global relevance.
Room for Improvement
It would seem that even free-market systems such as the United States of America are inching towards a more corporatist approach (Grugulis 2007). The introduction of the Workforce Investment Act 1998 is one such example; however this is cannot be described as a measure of state control. This is better described as an attempt by the state to enhance efficiency of existing markets and creating some system of national standards and certification (Ashton 2004). This is a clear indication that there is some guidance needed from the state in free market systems. The role of an employer after all is to maximize profits and not to be primarily concerned about the interests of its employees. Whilst there is a move globally towards more social responsibility and sector upliftment, generally the aim of managers in business is to bear in mind the firms best interests and not those of the employee. It is useful therefore to have some measure of state intervention such as the corporatist approach to ensure that there is some level of skills development in the form of vocational training (Grugulis 2007). Furthermore, a main problem with the US model is that there is no standard skills recognition. Whilst there is some drive to develop a national skills recognition system, there is constant opposition from federal states to the move. It would seem that US model has a deeply entrenched internal labour market that does not allow for maximum career progression or skills efficiency, and there is a strong resistance to changing this model (Ashton 2004).
The United Kingdom is another example of a free market system that takes a more corporatist approach when it comes to market failures and initial youth training (Ashton 2004, Rainbird 2002). The Modern Apprenticeship is one such example, critically however the state allows autonomy in these programmes as to the content and duration, thereby stipulating that apprenticeship programmes are to be undertaken, the details of which are at the discretion of the employer. One could criticize this for being too lasses-faire as again the issue of national standardization between profession arises. To the credit of the United Kingdom, they have introduced Sector Skills Councils to identify areas of skills shortage and develop according to those needs. These are entirely government funded initiatives and can be described as remnant of a developing state system. It is interesting to note that the United Kingdom takes such a pragmatic approach to the VET system adopting the better elements of both corporatist and developing state systems. They have also seen far greater success in linking VET with certification systems and therefore a better employment skills standard. The New Deal provides those at risk in the labour market with an introduction back into that market (Ashton 2004), whilst regional development agencies are funding experiments in workplace learning. All of these efforts facilitated by the state show an appropriate balance of state interference and state deference. On one hand they are allowing the free market by providing autonomy to finalise VET programmes, however on the other they are also working in conjunction with social partners creating a standardized system of certification and skills. This in turn will lead to an occupational labour market which is advantageous for the employee as their skills are now transferable and recognizable (Keep 1989, Grugulis 2007).
It seems clear that the best outcome in terms of VET systems would be one that is mutually beneficial to all parties. Absence of stringent regulation in a voluntarist approach is clearly more advantageous to firms and companies, however it creates a fair amount of complications for the employees as it ties them to the positions where training was received. Importantly it fosters a good work ethic as produces cutting edge advances and high skill formation (Grugulis 2007). It is clear that the state’s role in VET is of great importance. The perfect balance it would seem is to have the creation of an occupational labour market through some measure of state intervention coupled with social partners, as this is most advantageous to the employee, in a voluntarist market. To this end, the corporatist or educational model is the better solution. Importantly the creation of certification standards is imperative, whilst still allowing a sense of autonomy. It would seem that the United Kingdom is approaching a model such as this as they allow a free market, yet mandate VET in conjunction with social partners, whilst still with a measure of deference allowing the details of the training to be finalized by the firm itself. It is further clear that without the state mandate to this extent, firms are generally looking to further their own aims and not those of the employee, so without state intervention this internal market will form. The state therefore does need do more than encourage VET, but also to take proactive steps to facilitate the completion of this, for the creation of apprenticeship opportunities to lead to the establishment of an operational labour market that is mutually beneficial to all parties involved.
Workforce Investment Act 1998
Ashton, D. ‘The political economy of workplace learning’ in H.Rainbird, A. Fuller and A.Munro (ed.) Workplace Learning in Context, London: Routledge. (2004) pp.21 – 37
Grugulis, I. Skills, Training and Human Resource Development. Houndmills: Palgrave. Chapter 3: International Comparisons: Skills and Employment Systems, (2007) pp.35 – 53.
Grugulis,I. ‘Training and Development’ in T. Redman and A. Wilkinson (2nd) Contemporary Human Resource Management: Text and Cases. Essex: Pearson. (2008) pp.103 – 104.
Keep, E. ‘A Training Scandal?‘ in K. Sisson (ed.) Personnel Management in Britain. Oxford: Blackwell (1989) pp 177 – 202
Rainbird, H. ‘No rights, just responsibilities: Individual demand for continuing training’ in K. Evans, P. Hodkinson, and L. Unwin (ed.) Working to Learn: Transforming Learning in the Workplace. London: Kogan Page. (2002) Chapter 12: pp.23 – 33
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