From Aspirations to Occupations

The Role of Information in Educational and

Labor Market Decisions in Moldova

Victoria Levin

June 24, 2016

Outline

2

Motivation

Methodology and data

Findings

Policy implications

Outline

3

Motivation

Methodology and data

Findings

Policy implications

4

Source: UN World Population Prospects: 2015 Revision (left) and World Development Indicators (right).

0 50 100 150 200 250

0-4

10-14

20-24

30-34

40-44

50-54

60-64

70-74

80-84

90-94

100+

0 50 100 150 200 250

2060

2015

Males Females

Thousand people

Increased productivity is needed to respond to

the demographic challenge

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

GD

P p

er

pers

on e

mp

loye

d (

199

0 P

PP

)

Labor productivity in Moldova and comparators, 2012Age structure in Moldova, 2015 and 2060

0%

10%

20%

30%

40%

FYRMacedonia

Moldova Armenia Ukraine RussianFederation

Kyrgyzstan EU28

Male Female

5

Employment-to-population ratios, adult population (15+), 2014

Source: WDI, modeled ILO estimates, (top graph) and School-to-work transition survey 2012-2013 (bottom graph)

NEET rate (population aged 15-29), 2012-2013

Employment rates are very low, with many youth

detached from the labor market

0

10

20

30

40

50

60

70

% o

f w

ork

ing

ag

e p

op

ula

tion

0

2

4

6

8

10

12

14

EU10+1 and Turkey Western Balkans LI CIS MI CIS

KOS

LVA

KGZ

MDA

LTA

ROM

BLR

KAZ

TJK

MKD

SRB

BGR

CZE

HUN

POL

TUR

SVN

SVK

UKR

ARM

AZE

GEO

UZB

ALB

BIH

MNE

EST

HRV

Nu

mb

er

of

Co

un

trie

s

Source: BEEPS 2013

Poor labor outcomes may come from skills

mismatches

Countries

where between

30% and 40% of

firms report

that “skills”

has become a

severe

constraint to

growth

Large shares in upcoming cohorts seem to lack

basic cognitive skills

7

501 493 484468 459

390 388 374 362

314

0

100

200

300

400

500

600

0

10

20

30

40

50

60

70

80

90

100

Sco

re

Pe

rce

nt

Level 5&6

Level 4

Level 3

Level 2

Functionally illiterate

Overall reading score(right axis)

Proficiency in Reading, Moldova and Regional Comparators, 2010

Source: PISA 2010 results.

Bridging information gaps is critical to reduce

skills mismatches

Skills mismatches can arise from:

• Education system

• On-the-job training

• Information gaps

Particular relevance of information gaps in Moldova:

• Midst of economic transition

• Low urbanization

• High migration

• Lack of systematic career guidance

Information constraints can be reduced through low-cost policy

interventions

Outline

9

Motivation

Methodology and data

Findings

Policy implications

10

• Implemented during the 2014/2015 school year

• Main objective: understand how individuals make their schooling and jobs decisions

Moldova Jobs and Schooling Decisions Survey

Group type

Number of

communities

Number of

Respondents

Individual

interviewsFGDs

Individual

interviewsFGDs

9th graders23

3 304 26

12th graders 3 306 24

Professional school students 431

9524

Collegium students 3 103

University students 3 3 102 25

Out-of-school youth who are jobless or in occasional jobs 22 3 203 21

Out-of-school youth with complete transition to the labor

marketNo 22 0 14

Parents of 9th and 12th graders No 2 0 16

Parents of professional school students No 1 0 7

Teachers of 9th and 12th grade No 2 0 161 2 FGDs mixing professional school and collegium students and 1 FGD with only professional school students2 1 FGD with professional school and collegium graduates and 1 FGD with university graduates

Individual interviews: content

• Extent to which influencers are involved in the decision

• Final decision maker

• Knowledge on earnings

• Expectations on entry after education

• Job search methods

• Sources of information

• Type of information taken into account

• Background information

• Household composition

• Education history and transitions

• AspirationsIndividuals’ information

Education and LM

information

Decision influencers

Labor market

12

Students Parents Teachers Young adults

Module I

Students’ aspirations and education

How choices

are made

- Assessment of the community, school

and students

- Assessment of students’ future choices

- Factors that enable or constrain

transitions

How choices were made

Module II

Information sources, use and access

Their role as information channels

- Transition into the first

job

- Labor market experience

and values

- Job search methods

Module III Perceptions of career guidance activities

Focus Group Discussions: content

Outline

13

Motivation

Methodology and data

Findings

Policy implications

Educational and

occupational

decisions

15

Vocational education is as popular as general

education among 9th graders

27%25%

29%

4% 3%7%

32% 40% 20%

0%

20%

40%

60%

80%

100%

All (N=304) Women(N=171)

Men (N=133) All (N=306) Women(N=193)

Men (N=112)

...9th grade? …12th grade?

What do you want to do after...?

Professional school Collegium Lyceum University

Study abroad Work Other Don't know yet

36%

16

0%

20%

40%

60%

Good joboportunities

Interest infield of study

Easy tostudy

Immediateacquisition ofa profession

First optionthat came to

mind

Goodreputation

To pleaseparents

Affordability Proximity tohome

9th graders: why do you want to continue studying there? Most important reason

Professional school Collegium Lyceum Study abroad

- Moderator: To what extent does your wish to find a job influence your decisions regarding studies? - S: 98 percent.- Moderator: It matters that much?- All: YES!

Focus group discussion with urban 12th graders

Educational aspirations are driven by perceived

job opportunities

17

In choosing field of study, students opt for fields

where vocation and job opportunities intersect

0%

10%

20%

30%

40%

50%

Vocation Good jobopportunities

First optionthat came to

mind

Goodreputation

Immediateacquisition of a

profession

To pleaseparents

Other Easy to study

Why would you choose/are you studying this field of study?

12th graders (prospective) Professional school (retrospective) Collegium (retrospective) University (retrospective)

18

However, many students lack occupational

aspirations

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

9th graders

12th graders

Professional school students

Collegium students

University students

Ideally, what would you like to be doing when you are 30 years old?

Armed Forces Legislators, senior officials and managers

Professionals Technicians and Associate Professionals

Clerical support workers Service and sales workers

Craft and related trades workers Plant and machine operators, and assemblers

Don't know

Working as…

19

Note: the exact question is “what are the two fields of study you will most likely choose if you continue studying? Indicate the

top 2 options”, but the graph only shows the first option

Field of study is approximated by type of occupation for the LFS. Additionally, only individuals with collegium education or

more aged 25-34 are considered.

Source: Moldova Job and Schooling Decisions Survey and National LFS 2014

Gender differences in occupational aspirations

are likely to translate to occupational disparities

in the labor market

0%

10%

20%

30%

40%

Science,computing andengeneering

Humanities andart

Health Socialsciences,

business andlaw

Construction Education Sevices Agriculture andveterinary

Other Manufacturing

What is the field of study you will most likely choose if you continue studying? (12th graders)

0%

10%

20%

30%

40%

Science,computing

andengeneering

Humanitiesand art

Health Socialsciences,

business andlaw

Construction Education Sevices Agricultureand veterinary

Other Manufacturing

Employment by gender and occupation, LFS 2014

Men Women

The role of

information

constraints

21

There is an information deficit on the labor market

0%

20%

40%

60%

80%

100%

9th graders(N=304)

12th graders(N=306)

Professionalschool

students(N=92)

Collegiumstudents(N=100)

Universitystudents(N=99)

Do you think you have enough information about the labor market? Yes

Men Women

• About half of collegium students participating in MJSDS underestimates the education required to work in their ideal job

22

Notes: Significant differences in the wage index compared to the base category of the 3-year professional school program: * 10%, ** 5%, ***1%.

The wage index is calculated by setting the perceived monthly wages at age 30 after completing 9th grade as equal to 100.

The actual returns to education are based on the results of a Mincer regression controlling for gender, age, marital status, education, and location.

Students perceive increasing returns to education,

but certain important misperceptions exist

****

***

***

***

**

***

******

***

***

***

100

150

200

250

300

350

9th graders 12th graders Professionalschool students

Collegiumstudents

Universitystudents

LFS 2014 (25-34 y.o)

Perceived returns (MJSDS) Actual returns

wa

ge

in

de

x (

9th

gra

de

=1

00

)

Perceived and Actual Returns to Education after 9th Grade

3-year program in professional school (base) 12th grade Collegium Bachelor's degree

Information gaps are more severe for

disadvantaged students

23

*

***

0

20

40

60

80

100

…to decide what to do after 9th grade? …about the labor market?

Do you think you have enough information...? Yes

Less educated parents More educated parents

Types and

sources of

information

25

3 types of information for different stages

S c h o o l i n g D e c i s i o n s

L a b o r

M a r k e t

G e n e r a l T r e n d s i n t h e L M

E d u c a t i o n O p t i o n s

Students need general information on industries and professions particularly in the earlier stages, when they are making their educational decisions about what type of career path to take.

9th Grade

12th Grade

Information on the availability and requirements of schooling that match their career aspirations also play an important in their schooling decisions.

26

3 types of information for different stages

L a b o r

M a r k e t

G e n e r a l T r e n d s i n t h e L M

E d u c a t i o n O p t i o n s

R e a l L i f e J o b C h a r a c t e r i s t i c s

On the career path, this type of information is the most

needed following the general professional decisions, to

decide on areas of specialization and to build the

required skills and experiences to ensure successful

entry into the labor market when the time comes.

D e c i s i o n p o i n t :W h i c h t y p e o f j o b ( s ) t o a p p l y f o r a f t e r g r a d u a t i o n

J o b D e c i s i o n s

12th Grade

27

Parents and master teachers are perceived as the

most useful source of information but they feel

unprepared

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

Use

fuln

ess

(0=

do

no

t u

se

; 5

=ve

ry u

se

ful)

"How useful is the information on choices and opportunities after [current educational level] that you obtain from the following sources?"

9th graders 12th graders Older students

Note: Sample includes 9th graders, 12th graders, and older (professional school, collegium, and university) students.

Assessment

of career

guidance

activities

29

Very low students’ attendance and awareness of

career guidance activities

0%

20%

40%

60%

80%

100%

Careerorientation at

school

Alumnitalking about

theirexperience

Open doorsday at a

ProfessionalSchool

Open doorsday at a

Collegium

Open doorsday at a

University

Job fair ANOFMseminars

Visit toparent's

workplace

Visit to a firm

Percentage of individuals who haven't attended the following activities

9th graders 12th graders

Professional school students Collegium students

University students Out-of-school youth jobless or in occasional jobs

30

Internships are perceived as useful and can

provide entry point into the labor market

0%

10%

20%

30%

40%

50%

60%

70%

All(N=89)

Women(N=24)

Men(N=64)

All(N=86)

Women(N=51)

Men(N=35)

All(N=85)

Women(N=56)

Men(N=29)

Professional school Collegium University

After graduation, how likely are you to start working in the firm where you did your internship/apprenticeship?

Very likely Likely

• Information is valued by students

• Significant information gaps, particularly for disadvantaged

• Guidance and opinions of parents and master teachers is most useful

• Internships as most effective career guidance activity

31

Summary of main findings from MJSDS

Outline

32

Motivation

Methodology and data

Findings

Policy implications

33

Career guidance policies in other countries

• Labor market observatories (POL)

Improving available labor market information

• Providing information and career guidance to young students (CHE, AUS, FIN)

• Job fairs (AUS)

• Alumni visits (FIN)

Improving existing career guidance activities

• Early identification and targeted support (UK)

• Career counseling by employment services (GER)

• School social responsibility (UK, AUS)

• Pop-up services for remote areas (GER, ZAF, RUS, ARG, TUR)

Assisting disadvantaged students

• Engaging parents (AUS, UK, AZE)

• Partnerships between schools, employers, and PES (GER, UK, AUS)

Reaching out to potential advisers

• Online information on educational pathways and institutions (MEX, BGR, USA)

• Online resources to guide occupational choices (USA, UK)

Developing innovative career guidance tools

• Improving information can improve efficiency in education and labor market outcomes at a relatively low cost

• An effective career guidance system

• Focuses on exposure to the world of work

• Is anchored in strong networks

• Early, frequent and ample exposure to the world of work provides specific labor market information sought by students

34

What can Moldova learn from other countries?

Thank you

For questions and comments please contact

Victoria Levin

vlevin@worldbank.org

Silvia Guallar Artal

sguallarartal@worldbank.org