OECD urges nations to boost spending on education

Spending on education by countries around the world is rising but access to higher education remains unequal, says the latest OECD report, Education at a Glance 2012.

It says governments should increase investment in early childhood programmes and maintain reasonable costs for higher education in order to reduce inequality, boost social mobility and improve people’s employment prospects.

The report reveals stark differences between nations in the opportunities they offer their young people to enter higher education, notably for children of poor families or whose parents have had a limited education.

Releasing the report on Tuesday, OECD Secretary General Angel Gurría said nations needed an increasingly educated and skilled workforce in order to succeed in today’s knowledge economy. He said investing from an early age was crucial to lay the foundations for later success.

“High quality education and skills have to be among the number one priorities for governments, for economies and for societies. Supporting the poorest and ensuring equal access is another important pillar in an inclusive education policy strategy,” he said.

The report’s authors say Australia, Finland, Ireland and Sweden have the highest success rates in the OECD for young people of poorly educated parents attaining a tertiary degree.

But in Italy, Portugal, Turkey and the United States, more than 40% of young people from low educational backgrounds have not completed upper secondary education, and less than 20% have obtained degrees.

“Enrolling children early in formal education and keeping schools mixed in terms of social backgrounds have more impact in boosting educational equality than other factors, such as parental support or the cost of tuition fees,” the report says.

“Addressing inequality early is the key, as little can be done to remedy poor outcomes later in school without compromising the quality of higher education.”

Education, social mobility and jobs

New data used by the OECD analysts show the importance of a good education for social mobility and access to well-paid jobs. The earnings gap and employment rate between people with higher education and the less educated continued to rise during the global recession.

A 25- to 64-year-old man with higher education earned 67% more in 2010 than one with upper secondary education – up from 58% in 2008. For women, the earnings premium grew to 59% in 2010.

The unemployment rate in 2010 was roughly a third less for men with higher education than for men with upper secondary, while for women it was two-fifths less.

Countries gain long-term economic and social benefits from investing more in education, the report notes. On average, OECD countries receive a net return of more than US$100,000 in increased income tax and other savings for each man in higher education, almost four times their investment, although for women the return is 2.5 times.

“Well-educated people also live longer, are more likely to vote and have more supportive attitudes to equal rights for minorities,” say the analysts.

Spending on education

Public and private spending on education continued to rise, even during the economic downturn. Between 2008 and 2009, total investment – by governments, enterprises and individuals – increased in 24 out of 31 OECD countries for which data were available.

But while public spending on education as a percentage of total public expenditure remained at 13% on average across the OECD in 2005 and 2009, it fell in 19 out of 32 countries.

Private funding, mainly from parents, represents on average 30% of total expenditure on tertiary education.

Yet the gap between public and private contributions in the various countries is huge, with the proportion of private spending on higher education ranging from less than 5% in Denmark, Finland and Norway to more than 40% in Australia, Israel, Japan and the US, and to more than 70% in Chile, Korea and the UK.

“The increasing costs of entry to higher education for many families may impede countries’ own goals of increasing educational attainment in their populations,” the OECD report warns.

Education at a Glance provides comparable national statistics about education for the 34 OECD member countries, as well as Argentina, Brazil, China, India, Indonesia, Russia, Saudi Arabia and South Africa.

The report includes indicators on public and private spending on education, tuition fees, adult participation in education, class sizes, teacher salaries and decision-making powers of schools, and an analysis of national examination systems and the criteria for attending tertiary education.