Chapter 2 Promoting Inclusive Growth in Morelos
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2. PROMOTING INCLUSIVE GROWTH IN MORELOS – 95 Chapter 2 Promoting inclusive growth in Morelos This chapter provides an overview of the economic and social policies in the state of Morelos that are most related to human capital issues including an assessment of education, labour market training and innovation policy priorities in the region. Education and training policies should be pursued to improve social cohesion and productivity in the state. They should seek to attain inclusive growth by increasing student education performances and improving the alignment of skills supply with skills demand. Investing in innovation is also critical to regional competitiveness. Morelos should better mobilise its innovation infrastructure for knowledge diffusion and exploitation. A final section is dedicated to the newly-created Council for Human Capital, a regional governance body aiming to address the interconnectedness of such policy challenges and promote an integrated vision of regional development. Each policy domain is evaluated to support the state government of Morelos into building on opportunities and enhance the region’s economic development, learning from OECD best practices and policy recommendations. OECD TERRITORIAL REVIEWS: MORELOS, MEXICO © OECD 2017 96 – 2. PROMOTING INCLUSIVE GROWTH IN MORELOS 2.1 Introduction The current priority of the state of Morelos is to boost regional economic development and inclusive growth through a strong investment in human capital. A skilled human capital is at the essence of regional development and competitiveness. A region that benefits from a high-skilled workforce able to learn, create knowledge and rapidly adapt to changing labour demands and technologies will be able to use those skills to drive innovation and achieve a sustainable form of economic growth. Human capital is not only a determinant of economic growth and productivity, it is also one of social cohesion and well-being because with higher-level skills and quality jobs, people tend to live healthier. While developing a strategy to strengthen skills across the region, Morelos must also address the disparities that can be observed in different parts of its territory, and design and adapt policies accordingly. Rural areas of the state tend to be more marginalised than the urban, particularly metropolitan, areas. Territorial disparities are also noticed in students’ school performance as children living in the central and southern parts of the state tend to perform more poorly than those living in the northern part of Morelos. Likewise, the students that live in the smaller cities located at the periphery of metropolitan areas tend to underperform metropolitan students. A place-based approach can better integrate the various national, regional and municipal programmes and ensure they benefit from areas of policy complementarities. Pursing a single policy (e.g. education) in isolation will not effectively meet the ambitions that the state government of Morelos has set. Rather, the state will have to rely on a holistic approach encompassing different policy domains which, if well- coordinated, can help build stronger human capital and eventually achieve sustainable economic growth. Improving the skills in Morelos is paramount to boosting productivity growth in the region over the medium and long run. For all types of OECD regions, human capital appears to be the most critical and statistical robust factor influencing regional growth and development. The cross-regional analysis finds that, overall, reducing the proportion of the people in a region with very low skills seems to matter more than increasing the share with very high skill levels. Furthermore, the gains to human capital are multiplied when other framework conditions in the regions are in place, which indicates the importance of adopting a broader holistic approach to regional development. Building a competitive regional profile will also require engaging in inclusive policies and ensuring that all citizens can enjoy the redistributive effects of different policies. This will demand that infrastructure reforms are undertaken to allow a better connection of people to jobs and service, and – through a better overall mobility in the state – increase well-being. If well-managed, policy complementarities should undoubtedly help the state of Morelos in achieving a sustainable and inclusive form of regional economic growth. With the recent creation of the Council for Human Capital, the state of Morelos has well understood that fostering synergies across different policy areas is likely to bring the best results. The Council for Human Capital aims to develop an integrated strategy to strengthen the skills of the region’s population. However, the Council does not intend to focus merely on the supply of skills. It will also seek to support businesses in OECD TERRITORIAL REVIEWS: MORELOS, MEXICO © OECD 2017 2. PROMOTING INCLUSIVE GROWTH IN MORELOS – 97 becoming more productive and competitive, help the region strengthen its innovation profile and, over time, increase demand for high-level skills. 2.2 Building a future skilled workforce through education Education and skills policies are at the cornerstone of economic development. Quality education is intended to ensure that the future workforce of a country or a region develops the right skills to navigate the labour market, create innovations and contribute to society's well-being as healthy, responsible and ethical citizens. However, such positive outcomes can only be produced at a large scale should regions develop an inclusive form of development. The state of Morelos has understood this well by putting human capital at the centre of its economic growth strategy. Nonetheless, territorial disparities in student performances are still visible in Morelos and call for the need to put more measures in place to ensure that no child is left behind and benefits from the same quality of teaching and learning experience as better-off peers. While the region has taken steps to address the issues of inequity and inequality and boost participation rates in higher levels of education, it also needs to ensure that the skills that young people acquire are relevant to the needs of the economy. This may require new forms of collaboration to be envisaged when designing education and training policies. Morelos’ educational landscape and priorities The education system in Morelos reflects Mexico’s federal organisational structure. The Secretariat for Public Education is the federal and state’s main actor responsible for national education policy, strategy and delivery. Education is organised in three sequential levels: i) basic education comprised of pre-primary, primary and lower secondary school (typically for those aged 3-14), ii) upper secondary education (typical ages 15 to 17) and iii) tertiary education. Education is mandatory between the ages of 3 and 17. Several modalities of education may be observed at different education levels, as illustrated in Table 2.2. Education in the state of Morelos is virtually universal from ages 5-14. Morelos has made strong efforts to ensure that all children are enrolled in basic education. Most students attend school in the early stages of compulsory education and in urban rather than rural areas, as observed by enrolment rates in communitarian, indigenous and televised schools (see Table 2.2). Enrolment numbers start to decrease from lower secondary level, pointing at a difficult transition into upper secondary and higher levels of education. Morelos is doing better than the Mexican average in school completion across all levels of education (except pre-primary education), although provisional data for 2016 captures a significant reduction in upper secondary education drop-out rates from 20.3% in 2014 to 11.3 in 2016 (see Table 2.1 and 2.3) (Ministry for Public Education, 2014a; Ministry for Public Education, 2015; Ministry for Public Education, 2016). As observed in the first chapter, Morelos students' mean performances in PISA are above the Mexican average, although they are still lagging far behind OECD peers. Results from the most recent national PLANEA evaluation (2015), moreover, rank Morelos amongst the lowest performing areas of Mexico while highlighting large discrepancies among the performance of children from different socio-economic backgrounds and communities. OECD TERRITORIAL REVIEWS: MORELOS, MEXICO © OECD 2017 98 – 2. PROMOTING INCLUSIVE GROWTH IN MORELOS Table 2.1. Education completion rates in Morelos and Mexico (%), 2013-14 Education level Morelos Mexico Primary education 99.5 96.3 Lower secondary 98.7 87.7 Upper secondary 58.0 63.2 Source: INEE (2016), La Educacion Obligatoria en Mexico, Informe 2016, www.snte.org.mx/pdfindigena/LaEducacionObligatoriaenMexico.pdf. Table 2.2. Enrolment in education in Morelos, 2013-14 Level/type Total enrolment Proportion of Enrolment by modality (proportion within level and type enrolment (%) of education) (%) Total school system 545 144 100.00 Basic education 391 987 71.90 General Communitarian Indigenous Pre-primary 68 639 12.50 96.6 1.5 1.9 Primary 217 430 39.80 99.2 0.2 0.5 General Technological Televised Lower secondary 105 918 19.40 54.7 28.6 16.5 General programmes Technical-professional programmes Upper secondary 74 293 13.60 43.8 56.1 Bachelor Postgraduate Tertiary education 50 870 9.30 85.9 9.6 Education for workers 27 650 5.00 Note: Early childhood education: refers to programmes with an intentional education component aimed at developing