Hon Dr Michael Cullen

Minister for Tertiary Education

13 September 2007 Media Statement

OECD endorses government leadership on skills

An OECD report shows New Zealand has made considerable progress in integrating skills and economic development policies at the regional and national level since the election of the Labour-led government in 1999, and there are now opportunities to take that work even further, Tertiary Education Minister Michael Cullen said today.

The Integrating Employment, Skills and Economic Development report finds there was little central government attention paid to regional economic development prior to 1999, but there has since been a great deal of work to integrate labour market and vocational training policies.

Michael Cullen said the report is welcome, particularly as it comes at a time when the government is working with trade unions, business leaders and industry training organisations to develop a new, unified skills strategy.

“Since 1999, New Zealand has seen more people in work than ever before, more people in industry training, more young people getting skills through apprenticeships, and record levels of participation in tertiary education,” Michael Cullen said.

“The OECD report finds that the government’s work with councils, businesses, unions and the training sector has been a major driver of this success. But the OECD is correct in its call for further action.

“One of the consequences of our record-low unemployment rate has been persisting skills shortages. While we continue to see more and more New Zealanders enter the workforce and more gaining qualifications, we need to grow those numbers and ensure people have the right skills to meet industry demands.

“I am working with my colleagues Acting Social Development and Employment Minister Steve Maharey and Labour Minister Ruth Dyson through the Skills New Zealand Forum on a new skills strategy that will unify actions across government to ensure that New Zealanders are able to develop and use the skills needed in the future.”

Michael Cullen said he expected to make further announcements on a strategy before the end of the year.

ENDS

OECD-LEED study on ‘Integrating Employment, Skills and Economic Development’ – Department of Labour Summary

The full report is available at: http://www.dol.govt.nz/publications/general/iesed/summary.asp

The Integrating Employment, Skills and Economic Development (IESED) report to the Organisation for Economic Cooperation and Development (OECD) follows a study to identify existing co-ordination between labour market policy, skills and vocational training policy and economic development strategies at both regional and national levels. It includes a case study on the Bay of Plenty.

The key outputs of this OECD Local Economic and Employment Development (LEED) project are a New Zealand preliminary country report and a final cross-country comparative study report, including 11 countries, to be published by the OECD in 2008. The other countries in the study are Bulgaria, Canada, Croatia, Denmark, Greece, Italy, Poland, Portugal, Romania and the United States.

Key findings and recommendations:

Considerable progress has been made since 1999 to promote the integration of employment, skills and economic development policies at the national and regional level. Significant policy reforms in regional economic development policy and tertiary education were announced during the study period.

Labour market conditions are important in determining policy integration approaches. In particular, emerging skill shortages in the last seven years significantly boosted national and regional efforts to integrate skills and vocational training policies with labour market policies. However, the study recommends that regional economic development should be better integrated with vocational training policies.

A large number of regional initiatives were created within a short period of time, resulting in a numerous agencies seeking to create, support, or host a regional partnership without necessarily coordinating and aligning these efforts.

During the study period, the government announced its refreshed approach to regional economic development policy. As part of this, some work is being led out of the Ministry of Economic Development which will consider the coordination of government’s regional economic development activity, and will stocktake the provision of government’s economic development services at the regional level. This project will provide a useful vehicle to progress key IESED recommendations on ways to better co-ordinate government activity to support policy alignment.

The OECD study recommends:

- Work plans and Statements of Intent produced by central government agencies could be better aligned.

- Closer collaboration between local, regional and national stakeholders on setting targets to achieve similar policy outcomes at the regional level. These sorts of collaborations could also help to clarify roles and responsibilities of different parties in meeting such targets.

- There is widespread acknowledgement of the need for quality regional labour market analyses. Numerous agencies were producing labour market analyses at the regional level for their own purposes and these efforts could be consolidated to produce a more integrated product.

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