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Catalonia, Spain Catalonia, Spain 2 – ASSESSMENT AND RECOMMENDATIONS Assessment and recommendations Catalonia: from science and technology push to inclusive and balanced regional development With more than 7.5 million inhabitants, the Autonomous Region of Catalonia is the second most populous region in Spain, representing 16% of its total population. Catalonia is the main contributor to the Spanish economy with nearly 19% of Spain’s GDP. The GDP per capita is higher than the European Union average (EU-27). The engine of Catalonia’s development is Barcelona, which has transformed itself from a declining industrial city into a global gateway and one of Europe’s centres for design and biotechnology. Barcelona is a magnet for students, researchers and artists from Europe and abroad, with direct impact on the regional economy. Catalonia has a diversified economy. Manufacturing and market-related production services account for more than half of the region’s employment and GVA. 66.8% of employment is in the tertiary sector, 26% in manufacturing, 10.2% in construction and 2.2% in agriculture. Small and medium-sized enterprises (SMEs) dominate the regional economy. Productivity (GDP per worker) for Catalonia, like Spain overall, has been slipping relative to the rest of the OECD, decreasing from 115% of the OECD average in 1995 to only 91% by 2005. This has been due to the expansion of a less educated and lower skilled workforce, and the inability of firms in major Catalan industries to move up the value chain via product innovation. Almost two-thirds of manufacturing employment is in medium- low or low-technology industries. Catalonia’s manufacturing base is increasingly faced with the pressures of global competition and industrial relocation. Since 2007, Spain has been severely affected by the global economic crisis. It has the second highest unemployment rate within the EU at 20.4% in the third quarter of 2010. Youth unemployment reached 43.5% in the end of 2009, an increase of 24.7 percentage points since the end of 2007. Unemployment in Catalonia is approximately 16.53%, highest among the young under 24 years (41.2%) and those with low skills. While educational attainment levels have improved in Catalonia in the two last decades, a large proportion of population has low skills and 9.6% of the population is illiterate or without schooling. To prepare for the post-crisis economy, Catalonia and its universities and other tertiary education institutions in regional development need to address the following challenges: How to create jobs, address unemployment and improve the flexibility of the population to face rapid changes in the labour market? How to improve the relevance and quality of education? How to transform the economy through upgrading established industries and building new market opportunities? How to strengthen and diversify the existing industries and improve the absorptive capacity of the SME-based economy? How to address the socio-economic gaps, needs of the diverse population with a large number of immigrants and a growing number of ageing citizens? How to reform the governance and management to unleash the potential of universities for local regional development and greater efficiency and productivity? In order to slash unemployment and to improve productivity, Catalonia needs to foster human capital development for new and changing jobs. There is a need to balance the current strong focus on talent attraction with nurturing talent at home and by improving the access of new immigrants to tertiary education. Catalonia and its universities need to view job creation as a key goal for innovation and adopt a wide innovation concept beyond science push. At the regional and institutional level stronger incentives for regional engagement could be provided through performance-based funding and “challenge-driven” competitive calls. There is also a need to monitor the rate of return and effectiveness of public investment in research and innovation. Finally, to unleash the full potential of universities in regional and local development, it is necessary reform the university governance in Spain, by strengthening the institutional autonomy of universities and building effective accountability structures. Continuing collaboration 4 – ASSESSMENT AND RECOMMENDATIONS between regional and local governments, private sector and tertiary education institutions is necessary. Human capital development in Catalonia Tertiary education in Spain and Catalonia has experienced growth and transformation over the past decades. The expansion of tertiary education has widened access in Catalonia, but the overall participation rate remains below the OECD average. Economic recession has contributed to the deterioration of the labour market and a large number of youth are outside education, training and labour market. In future, widening access and social inclusion will need to feature more prominently on the policy agenda. Spanish tertiary education system has experienced significant growth and transformation over the last 20-25 years. In Catalonia, the average number of years in formal education for the working population has doubled, and the population with tertiary education qualifications has grown almost seven-fold. Currently, about one-third of the total working population has received some form of tertiary education. This progress is partly due to the considerable expansion of the tertiary education system now encompassing eight public universities – including the Open University of Catalonia – and four private universities, and more than 300 centres providing vocational tertiary education. There are 177 000 undergraduate and masters’ students in universities in Catalonia, representing 12.5% of the Spanish university system in 2009-10. Around 43 500 students are enrolled in vocational tertiary education. Although student enrolments overall have increased since 2000, with the greatest expansion in vocational education, participation rates for Tertiary-A programmes are below the OECD average. In Catalonia, a significant proportion of the young age group remains outside education and training. In Spain, nearly one in three people between the ages of 18 and 24 have not completed secondary education and are not enrolled in education or training, representing more than double the EU average (EU-27). While equity policies have improved in Spain, students’ financial, academic and social support systems are in need of strengthening. In Catalonia, participation in tertiary education continues to be related to socio- economic background. Because of the lack of adequate student support, student mobility is limited and a significant number of students need to work while studying. There is also a high level of educational failure with the drop-out rate estimated at 30% by some institutions, and students take longer than necessary to complete their degree programmes. Challenges in tertiary education in Spain and Catalonia are partly linked to the problems in the secondary education system which features high drop- out rates and poor learning outcomes. Those in school perform poorly in international testing (PISA). According to Pisa results for 2006, fewer than one in 20 of Spain's 15-year-olds reach the top levels of science proficiency. Furthermore only 1.5% of 15-year-olds in Spain belongs to the top performers for reading, the lowest percentage in the OECD countries apart from Mexico. In Catalonia, students learning outcomes have improved since 2000 and the 2009 results are slightly above the national and the OECD averages. However, a lot remains to be done to reach the level of the best achieving OECD countries. The primary responsibility for overcoming quality and equity gaps in secondary education lies with school authorities at the national and regional level who will need to address the challenges in a comprehensive way and mobilise appropriate levels of financial resources to support education. Universities should, however, actively reach out to local schools to raise aspirations and academic performance of students and to improve the quality of teaching. Catalan universities’ focus on widening access measures remains limited in scale and impact, and without collaborative action. Despite some good examples in this field, none of the universities have adopted a strong corporate approach to creating and enforcing mechanisms to facilitate access of the upcoming generations of new migrants to tertiary education. Long-term institution-wide and system-wide collaboration between schools and universities are needed in Catalonia in order to improve the quality of teaching and to raise aspirations. The current economic crisis has led to the deterioration of the labour market, especially for the young. The rise in youth unemployment obliges young people to stay in or enter the tertiary education system, but offers poor prospects for finding jobs after graduation. Unemployed workers and people in weak economic sectors are increasingly looking to education and training opportunities to improve their position in the labour marker. There is a need to focus on the quality and relevance of education and align it with the regional needs. 6 – ASSESSMENT AND RECOMMENDATIONS Unemployment in Catalonia has remained consistently high throughout the first decade of the 2000s, not falling below 12% and reaching 16.53% in the third quarter of 2010. Since the onset of the global economic crisis, unemployment in the 16-24 year cohort is running at 37% with even higher rates among
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