Provide more opportunities for people to succeed through vocational skills, says President Tharman

SINGAPORE – To reduce the hierarchy between academic and vocational pathways, countries must provide real opportunities for people to excel and attain mastery in technical fields, said President Tharman Shanmugaratnam.

Singapore is focused on this, Mr Tharman said in remarks opening a session at the World Economic Forum (WEF) titled “A Coming Jobs Challenge In Emerging Markets?” on Jan 21 in Davos, Switzerland.

There still exists in education systems around the world, including in Asia, an “overly academic education system”, Mr Tharman said.

“It should not be an either-or choice of an academic or more technical education.

“It has to be about providing pathways for everyone to ascend and excel through the pathway that matches their interests and capabilities.”

Mr Tharman raised this as one way that governments can act to create more and better jobs – a chief concern for most people globally.

Turning away from the geopolitics of the day, what is on the minds of most people is the need for security and growth in their careers, Mr Tharman said. “If we start with what is on the minds of most people, jobs must therefore be a central priority.”

To create jobs in the developing world, one can start with lessons from what has already worked in other parts of the world, he said.

Job creation has worked relatively well in several countries in East Asia, Mr Tharman noted.

One way these countries have done this is in developing human capital – and not just in schools.

This starts “much further upstream” in early childhood development, starting with nutrition for children who are still in the womb, he said.

He cited an example of a scheme in India known as “anganwadi” centres – rural childcare centres in villages that focus on maternal and child health.

“These early-stage investments have the largest multipliers over a lifetime – all the studies show that,” Mr Tharman said.

Other strategies adopted by East Asia in the past are still relevant for South Asia and Africa, but have more limited potential than in the past, Mr Tharman noted.

Manufacturing is now “much more a story of technology, and increasingly about advanced robotics and artificial intelligence”, he said. “But its potential for job creation in the developing world has not disappeared.”

He cited how a lot of manufacturing in China and middle-income countries like Vietnam, Brazil and Malaysia is not at the top end.

China has moved up to very high skill levels, but it is still doing a lot of traditional low-end manufacturing using advanced equipment, he noted. “If part of that can be decanted to Africa and South Asia – it is already being decanted to places like Tamil Nadu in India – it can create a big lift in manufacturing employment.”

As China addresses its domestic imbalances, including its overproduction of manufacturing goods, there is scope for moving more of that production to other parts of the developing world, Mr Tharman said.

The green transition also presents a major opportunity for job creation in the developing world, he said.

Africa and South Asia are rich in solar, wind, hydro and thermal energy, and they could be sites for energy-intensive production for the world, apart from their own regional markets, he noted.

Mr Tharman said studies have shown that the number of jobs created by a dollar of investment in renewable energy is some three times higher than that in fossil fuels.

This is not an ideological question, or of fossil fuel versus renewable industry interests, he said. “The question in regions that are critically short of jobs is – where can we generate the most jobs?”

This is a real opportunity that did not exist at the time East Asia took off: The opportunity to create a range of jobs – unskilled, semi-skilled and high-skilled – through the transition to renewable energy, he noted.

The session was moderated by WEF managing director Saadia Zahidi. Sri Lankan Prime Minister Harini Amarasuriya, Nigerian Finance Minister Wale Edun, Petronas chief executive Tengku Muhammad Taufik, Infosys non-executive chairman Nandan Nilekani, World Bank president Ajay S. Banga and Bloomberg journalist Stephanie Flanders also spoke.

Mr Banga opened the session along with Mr Tharman, noting that over the next 12 to 15 years, 1.2 billion young people in emerging markets will become eligible for a job.

Yet those very same economies are currently projected to produce around 400 million jobs, he said.

“So, the issue is that we have a real challenge here in terms of getting the right impetus for their growth, while at the same time, the real opportunity – that hope and optimism, and employed people, whether working for someone or entrepreneurs, that drive, that energy, that optimism, that hope, and what it means for our grandchildren.”

Crucial to “getting the job engine going” are infrastructure and people being educated with the right policies, with the right financial services, Mr Banga said.

Mr Banga also shared some findings from the World Bank Group High-Level Advisory Council on Jobs, which Mr Tharman co-chairs with former president of the Republic of Chile Michelle Bachelet.

The council has highlighted five sectors to focus on: infrastructure, primary healthcare, agriculture for small farmers, tourism, and value-added manufacturing.