| || ||Mark Robbins |
Industry and Business Strategy Research
| || ||Cameron MacLaine |
Industry and Business Strategy Research
The World Economic Forum recently ranked Switzerland as having the world’s most competitive economy for the seventh year in a row.1 Canada, which ranks only 13th, can learn much from top performers like Switzerland on how to improve. Canada and Switzerland share important traits. Our respective economic successes are driven by a strategic push for higher education, the development of human capital, and improved productivity and innovation performance from a highly educated population.
While university education is recognized as an important factor driving workforce productivity, Switzerland places a comparatively high emphasis on vocational and professional educational training (VPET). Switzerland has one of the highest proportions of students in VPET training in the OECD (7th) and the highest proportion of students in dual-track VPET programs that combine work and school.2 Canada has been looking to improve its vocational training system in recent years, and can learn much from Switzerland’s model, which puts apprenticeship training at its forefront.
A Dual-Track Approach
In Switzerland’s apprenticeship system, workplace and classroom training are closely integrated with one another. Apprentices combine three to four days per week of workplace training with one to two days per week of classroom training, otherwise known as “day release.”3 This ensures that apprentices can efficiently apply theoretical knowledge learned in the classroom to real work environments. This integrated system is partly why Switzerland’s youth unemployment rate in 2014 (8.6 per cent) was significantly lower than the European Union’s (22.2 per cent) and most other countries of the OECD (average of 15.1 per cent).4
Switzerland’s high-performing VPET system is partly the result of Swiss businesses’ strong desire to be involved in the country’s education system; they see it as their “social responsibility.”5 By comparison, Canadian business investment in training and human capital is low, and it’s one of the areas depressing Canada’s economic competitiveness.6 One of the most important lessons offered by Switzerland through its VPET system is how it has mitigated firm-level concerns about the poaching of employees. Switzerland includes professional associations and unions in the system’s governance structure, ensures that companies benefit from training apprentices, and in some cases, requires companies to contribute to a national VET fund. These approaches create a safe environment for businesses to invest in training—one of Canada’s biggest obstacles to higher employer investment in education, training, and development.7
Research into the Swiss system suggests that the more students and their families learn about vocational training, the less it is associated with lower social status, thus improving uptake and output. In fact, there are marked differences in the perception of vocational training in Switzerland, Germany, and Austria where this positive attitude is highly prevalent, and the rest of Europe where it is less common.8 This provides an important lesson for Canada as it seeks to improve its competitiveness on the global stage with an effective vocational education system. The combination of a strong and effective system, plus strong positive messaging about the value and rewards of vocational training can modify and eventually reverse professional and educational stigmas that stand in the way of this type of learning for many.
Lessons for Canada
Canada can also take a page from Switzerland’s national coordination and harmonization of higher education initiatives. Canada and Switzerland are both highly decentralized federations—by one measure, Canada and Switzerland are the two most decentralized countries in the world established at roughly the same time.9 The two diverged in 1874 when inter-cantonal free trade was established in Switzerland, which became a crucial landmark in the development of the Swiss VPET system.10 In contrast, although Canada may technically have internal free trade, there are still practical limitations (such as licensing and credential recognition) that continue to limit the free flow of goods and talent between provinces.11 This lack of harmonized standards presents obstacles to a unified VPET system that maximizes competitiveness.
Switzerland also provides an interesting case study for Canada when it comes to connecting with the European Union. Although Switzerland is not a member of the EU, 80.5 per cent of its goods and services are destined for EU markets.12 This makes a degree of convergence and harmonization of trade and occupational standards with the EU an important prerequisite for Switzerland, so that it can take full advantage of EU market opportunities. At the same time, Switzerland has been able to balance this harmonization with guarding the independence of its own system.13
With the Canada-European Union Comprehensive Economic and Trade Agreement (CETA) set to encourage free trade between Canada and the EU starting in 2016, the experience of Switzerland’s trade-optimized—but independent—higher education system provides interesting considerations for Canada.
Switzerland’s track record of optimizing vocational and professional training makes it an interesting role model. Its successes in improving and expanding VPET, engaging business closely in the educational process, and harmonizing and coordinating higher education initiatives provide Canada with best practice models that could help overcome major barriers to creating a more comprehensive and effective higher education system. This, in turn, has the potential to significantly improve our national competitive performance.