President Tharman Shanmugaratnam highlighted the urgent need to address the global skills mismatch during a panel discussion at the World Economic Forum in Davos, Switzerland, on January 22. He emphasized that the discrepancy between the skills taught in educational institutions and those demanded by employers not only presents an economic challenge but could also erode trust in educational and social support systems over time. This issue manifests as joblessness among individuals with tertiary education across both developed and developing nations.
The discussion, moderated by Jamie Heller, editor-in-chief of Business Insider, featured insights from various leaders including Veronica Nilsson of the OECD's trade union advisory committee, Denis Machuel of Adecco Group, LinkedIn CEO Ryan Roslansky, and Gilbert Houngbo from the International Labour Organisation. They explored strategies to bridge the jobs gap in a session attended by policymakers, activists, and business figures.
President Tharman critiqued the excessive academic focus in most countries’ education systems, advocating for a balanced appreciation of technical and vocational skills which are often undervalued in favor of academic credentials. He proposed that both technical paths and soft skills like teamwork should be recognized for their potential to reach high levels of expertise and effectiveness in the workplace.
He also warned of the socio-political implications of job scarcity, particularly in developing economies. With an estimated 1.2 billion people entering the job market over the next decade and only about 400 million jobs projected to be created, there is a significant risk of exacerbating international instability.
President Tharman underscored the importance of early and inclusive efforts to nurture human potential through quality public education systems. He referenced the Programme for International Student Assessment (PISA) results to support the effectiveness of public schooling in equipping students with real-world problem-solving skills.
Finally, he urged employers and governments not to delay investments in workforce training, especially with the looming challenges posed by new technologies like artificial intelligence. He called for narrowing gaps in training, compensation, and social security contributions between formal employment and the informal sector, including gig workers. The panel concluded by discussing ways informal employment could compensate for job creation deficits and enhance social protections for gig workers, emphasizing the need for skill-based hiring and robust regulatory frameworks for AI.