The labour force will grow to 2.4 million by 2020. Approximately 1.4 million of the current workforce will still be in the labour force in 2020. An additional 640,000 young people will come into the labour force from the formal education system. The remaining additional 310,000 will be made up of immigration and increased participation by the existing population.
Table 11 below (Column 1) shows the 2005 skills (educational attainment is used as a proxy for skills) profile for Ireland. OECD comparisons of this profile with that of other OECD countries are unfavourable. In 2004, only 6 out of 27 OECD countries had a worse performance than Ireland in terms of the percentage of the labour force who had only attained up to lower secondary qualification.
If we simply extrapolate current provision and demographic trends and do not add to training and education output, the educational attainment of the labour force will have improved. This baseline ‘no policy change’ scenario is set out in Column 2, Table 11. However, it is important to remember that our main trading competitors will also have improved their educational profiles and that if Ireland is to compete effectively, it will need to build competitive advantage in the area of skills.
Comparing these baseline ‘no policy change’ educational attainment projections (Column 2) with projected demand in 2020 (Column 3), leads to the conclusion that by 2020 there will be:
- A slight shortage at levels 8 to 10;
- A significant shortage at levels 6 and 7; and
- Surpluses at levels 1 to 5 with the possibility that a large number of low-skilled individuals will be unable to find suitable employment.
Ireland’s ambition should not be to simply meet projected skills demand based on an extrapolation of current observed trends. If Ireland is to develop competitive advantage in world class skills, education and training, and transition to a knowledge economy in which skills drive innovation, productivity and entrepreneurial activity, it requires a skills profile which substantially changes the equilibrium – that is, one that is skewed towards higher levels of skills attainment. Such a profile is set out in Column 5, Table 11. The challenge for Ireland is to move from the baseline ‘no policy change’ scenario set out in Column 2 to the vision of a skills profile for the new knowledge economy set out in Column 5. 127 Although apprenticeships are placed at level 6 on the NFQ, for the purposes of this report they are classified according to the CSO Quarterly National Household Survey as post Leaving Certificate education which has been included at NFQ levels 4 and 5 in Section 4.7 and in Chapter 5.
Table 11: Skills Profile of Ireland’s Labour Force – Absolute and Relative Share Grouped by NFQ level
|NFQ Level||Column 1||Column 2||Column 3||Column 4||Column 5|
|Current Skills Profile (2005)||Baseline Skills Profile in 2020 based on 'no policy change' to Supply||Baseline Projected Demand for Skills in 2020||Unmet Skills Needs (Column 3 less Column 2)||Vision of Skills Profile for 'New Knowledge Economy'in 2020|