Closing Italy’s skills gap is everyone’s business

by Andreas Schleicher
Director, Directorate for Education and Skills

Italy is the birthplace of Leonardo, Galileo and Armani. For centuries, skilled Italians have been recognised for their contributions to the world’s art, science, and culture. A relatively small country, with scarce natural resources, Italy today is among the world’s leading industrialised economies and is home to millions of firms, including many small and medium sized enterprises (SMEs), who play a prominent role in many key global value chains. So the skills of Italy’s population matter. Not only for their own country, but also for their contribution to the future prosperity and well-being of the global community. 
Italy’s future prosperity depends upon the skills of its people
Today, Italy is facing a skills gap. OECD Surveys measuring the skills of 15 year-olds (PISA) and adults between the ages of 16 and 64 years old (Survey of Adult Skills, PIAAC) have detected a significant shortfall in skills  compared with other countries. Despite progress achieved over the past decade, young Italians’ PISA scores in literacy and science are still relatively low compared with the OECD average. Adults display an even larger skills gap compared to their peers in other OECD countries. In 2012, some 13 million adults between 25-64 scored at the bottom of the PIAAC ranking,  while in some southern regions 2 out of 3 adults were found to be functionally illiterate. Poor skills are paralleled by stagnant productivity growth, which indicates that Italy may be trapped in a low-skilled equilibrium in which both the supply of, and the demand for, skills are weak.
Implementing recent reforms requires concerted efforts  
Italy has recently embarked on a major reform effort aimed at boosting the development, activation and use of people’s skills. For example, the 2014 Jobs Act introduced a major overhaul of labour market settings to favour open-ended contracts (over fixed-term ones) and strengthen active labour market policies. The following year, the Good School Act made work-based learning compulsory for all high schools, in order to provide students with real life experiences and a much broader range of learning opportunities. But Italy did not stop there, and in 2015 put in place Industry 4.0, a 3-year programme that provides firms with targeted support to help them transition to digital technologies and boost their demand for skilled workers. 
Implementation of these reforms has met with many challenges. They can only be addressed by generating synergies among different skills policies, engaging more with key stakeholders and improving the multilevel governance of the national skills system. 
Italy faces 10 skills challenges
Today, the OECD Secretary General is in Rome to launch the OECD Skills Strategy Diagnostic Report for Italy, together with a high-level panel of Ministers and undersecretaries. The report applies the framework of the OECD Skills Strategy to identify 10 skills challenges for Italy as it seeks to maximise its future skills potential. It includes a rich set of comparative data and evidence and offers concrete examples of how other countries are tackling similar skills challenges. 
With regards to developing relevant skills, the report focuses on:  
1. Equipping young people across the country with skills for further education and life; 
2. Increasing access to tertiary education while improving quality and relevance of skills;
3. Boosting the skills of low skilled adults.
When activating people’s skills, Italy will need to tackle the challenges of:  
4. Removing supply- and demand-side barriers to the activation of skills in the labour market;
5. Encouraging greater participation of women and youth in the labour market.
Italy also needs to make better use of the skills it has by: 
6. Making better use of skills in the workplace;
7. Leveraging skills to promote innovation.
Finally, Italy urgently needs to improve its overall skills system by: 
8. Strengthening multilevel governance and partnerships to improve skills outcomes;
9. Promoting skills assessment and anticipation to reduce skills mismatches;
10. Investing to improve skills outcomes.
Each of these 10 skills challenges are well known in Italy. By adopting a systemic approach to their analysis, this report underscores the need for renewed efforts to adopt a whole-of-government skills strategy that cuts across ministerial silos and gives an active role to key stakeholders, including civil society.  To close its skills gap, Italy needs to mobilise everyone’s energies to ensure that skills policies are implemented effectively and help deliver inclusive growth. 
Taking action today
The diagnostic phase of the OECD National Skills Strategy project in Italy has brought together many different ministries and a large number of stakeholders to gather insights and start generating a common narrative about the skills challenges facing Italy today. Developing concrete plans for action will mean building on the many reforms already underway and the continued engagement of all stakeholders.
The OECD stands ready to support Italy as it builds the skills that will empower its people to generate a new wave of well-being, prosperity and innovation that will benefit everyone, everywhere.
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