Higher Education Reform in Korea- Policy Responses to a Changing Labor Market -
February 13, 2007
Moon Hee Kim
Ministry of Education & Human Resources DevelopmentRepublic of Korea
Labor Market Change and Higher Ed., Expert Meeting, CERI(OECD) 2
CONTENTSCONTENTS
1 Overview
2 The Change of Labor Market
3HE Policy Responses to Labor Market Change
Labor Market Change and Higher Ed., Expert Meeting, CERI(OECD) 3
1. Overview
Labor Market Change and Higher Ed., Expert Meeting, CERI(OECD) 4
1,642,119791,9282,434,04717843221Subtotal
1,483,180
93,061130
1,02764,658
63
405,25625,88187,374
273,417
1,888,436 25,881
180,435130
273,4171,027
64,65863
150
81
315
1
2511
6
1
1751114
113
151
UniversityTeacher collegeIndustrial Univ.Tech universityAir&corresponMiscellaneousCyber College in Company
788,14533,553821,69814213155Subtotal
886,9266539
3,600
33,553817,9946539
3,600
139-12
13152-12
Junior CollegeTechnical collegeMiscellaneousCyber College
PrivatepublicTotalprivatepublictotal
Number of studentsNumber of schools
Number of Students & Schools, HE<As of April 1, 2006>
Labor Market Change and Higher Ed., Expert Meeting, CERI(OECD) 5
Economic Development
1970 1980
1990
1997
1998
2000
2004
2005
Population (Millions) 32 38 43 46 46 47 48 48
GNI per capita (US$)
650 2,324
7,751
10,363
6,843
9,675
14,193
16,291
Unemployment rate (%) 4.4 5.2 2.4 2.6 6.8 4.1 3.7 3.7
Labor force (Millions) 10 14 19 21 21 22 23 24
Labor force Participation rate (%)
47.6 59.0 60.0 62.2 60.5 60.7 62.1 62.0
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Sequential Expansion of EducationStep-by-step attainment of universal education: primary secondary higher education
Enrollment by Educational Level
0
20
40
60
80
100
120
1970 1975 1980 1990 1995 2000 2003 2005
(%)
Primary
LowerSecondaryUpperSecondaryTertiary
Elite Mass Universal※ Trow, “Forms and Phases of Higher Education”: Elite Mass Universal
Labor Market Change and Higher Ed., Expert Meeting, CERI(OECD) 7
Economy Period Education
Take-off & export-driven growth(’60s); export acceleration(early ’70s)
1960s ~ mid-1970s
Expansion of primary and middle school education; emphasis on TVET(late ’60s)
Structural adjustment(late ’70s); from imitation to innovation(’80s)
mid-1970s ~ 1980s
Expansion of high school and higher education; strengthening of TVET
Pursuit of national competitiveness(early’90s); knowledge-based economy(late ’90s)
1990s~Present
K-12 quality enhancement; investment in higher education; reform for lifelong learning
Policy Foci for Economy and Education
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2. The Change of Labor Market
Labor Market Change and Higher Ed., Expert Meeting, CERI(OECD) 9
Changes in Industrial Structure< Employment Structure >
8111834
5063
18.7
8.814.3
22.5
27.6
20.4
2.62.9
6.27.4
7.5 7.9
25.5 32.4 37.347.1
61.5 65.5
0%10%20%30%40%50%60%70%80%90%
100%
1963 1970 1980 1990 2000 2005Agriculture, f orestry, fi shery ManufacturingConstruction Service industry
※ 2015p: Agriculture 5.5%, Manufacturing + Construction 18.3%, Service 76.2%
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42.5
34.0
25.6
21.1
18.6
13.0
12.7
11.7
11.4
10.3
54.4
62.2
69.3
71.7
71.9
73.2
72.9
67.5
64.4
57.2
3.1
3.8
5.1
7.2
9.5
13.8
14.3
20.8
24.3
32.5
0% 20% 40% 60% 80% 100%
1970
1980
1990
2000
2006
2017
2018
2026
2030
2040
0 ~ 14 15 ~ 64 over 65
Demographic changeLow
Fertility Ageing
Total fertility rate No. of birth
Demographic structure:age group
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4.4 43.3 3.6 3.7 3.7 3.2
8.1 7.97
8 8.3 87.5
0123456789
2000 2001 2002 2003 2004 2005 2006.11 전 체 15 - 29세
Unemployment rate(%)
Youth UnemploymentYouth(15~29세 ) Unemployment(’06.11), 7.5%(34.3mil.): 2.3times greater than the overall UR
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Skill Mismatch / Low Satisfaction
A
B B
C C
Lack of qualified core talents
Youth unemployment(343,000)
Labor shortage at SMEs(197,000)
SupplyDemand
Low level of satisfaction towards university graduates ※ ※ Ranked 50th out of 61 countries in terms of university education meeting Ranked 50th out of 61 countries in terms of university education meeting
economic demands(IMD, 2006) economic demands(IMD, 2006)
Skill Mismatch in labor force
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1.2
1.3
1.4
1.5
1.6
1.7
1.8
1992 1994 1996 1998 2000 2002 2003
1.5
1.6
1.7
1.8
1.9
2.0
2.1
(company size) Over 500 / 10-29
4-year college graduate / HS graduate
Regular / non-regular employment
Wage gaps by employment (ratio)Wage gaps by employment (ratio)
Wage gaps / Wage premiumIncreasing non-regular employment widening a wage gap.University premium decreased until mid-90s but…
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3.HE Policy Responses to Labor Market Change
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Top-notch Top-notch professionalsprofessionals
(Graduate Schools)
Regional Regional innovation innovation initiatorsinitiators (Universities)
Industrial Industrial engineers engineers
(Junior Colleges )
LB information
Restructuring & competition
Partnerships
Selected funding for specialization
Vision and Goals
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Major strategiesImprovement of HE/labor market information
- manpower forecasting and assessment of skill requirements
Promotion of restructuring and competition through market discipline
- use of various incentives and disincentives
Funding based on “selection and concentration” - targeted funding for specialization and regional parity
Financing learners rather than providers - learner-oriented/demand-side financing (student loans)
Enhancement of networking and partnerships - with local governments and business community
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Strengthening graduate programs in high value-added service areas: medicine, law, international finance, MBA, etc
Introduction of a new HE quality assurance system - Establishing the new quality assurance agency including the accreditation and certification process with global standard - Financial provisions aligned with institutional evaluations
Clearing HE information - Inputs measures: PT ratio, unit expenditure, occupancy/ enrollment rate - Process/Outcome measures: persistence/graduation rate, employment rate, customer satisfaction, etc.
Financial incentives for reform and restructuring HE Inst. - Subsidies linked to amalgamation among institutions
※ Reducing enrollment by 50K students by 2009(18 inst. merged into 9, as of 2006)
HE Reform Initiatives
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Major Programs to enhance the Quality
◈◈ 1st-Phase Brain Korea 21 (1999~2005, US$ 1.4billion) ▶Enhanced university research capacity; induced competition ※ ※ Number of BK21 science & tech SCI-level papers: 3,765(1998) Number of BK21 science & tech SCI-level papers: 3,765(1998) 7,947(2005) 7,947(2005)
▶Produced scientists of international competence ※ ※ Number of doctors in science & tech(1999~2005): 6,602Number of doctors in science & tech(1999~2005): 6,602
◈◈ 2nd-Phase Brain Korea 21 (2006~2012, US $2.3billion) ▶Cultivate 20,000 graduate-level best brains per year ※ ※ 74 universities, 244 project units, 325 project teams(2006, US$ 290million)74 universities, 244 project units, 325 project teams(2006, US$ 290million)
◈◈ New University for Regional Innovation (2004~2008, US$ 1.2billion) ▶Specialize local universities; nurture human resources readily adaptable to the industry 109 local universities, 130 project units ※ 109 local universities, 130 project units ※
◈◈ “Connect Korea” Project(2006~2010, 150million) ▶Strengthening partnership b/w universities and industry ▶Establishing Consortium b/w TLOs (Technology Licensing Offices) in univ.
(1US$ = 1,000KRW)
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The government system changed since 2001.
Before NowName MOE MOE&HRD
Head Minister Deputy Prime Minister(DPM)
Scope Education, Adult Education
Education, LLL,Coordinating HRD Policy
Government Role
Coordinate HRD/VET polices among different line ministries. - Ministerial Committee on HRD (chairperson : DPM) - The Committee is composed of 14 Ministers