Stronger partnerships to address skills mismatch – study

By Francis Allan L. Angelo

A recent study by the Philippine Institute for Development Studies (PIDS) highlights the critical need for robust partnerships and institutional arrangements to tackle the persistent issue of skills mismatch in the Philippine labor market.

Authored by PIDS Senior Research Fellow Dr. Connie Dacuycuy, former Research Fellow Dr. Ma. Christina Epetia, and Research Specialists Anna Rita Vargas and John Joseph Ocbina, the study titled “Inputs to the Philippine Labor Market Information System and TESDA’s Skills Anticipation and Prioritization of Skills Requirements Framework” underscores how coordinated efforts can significantly enhance the Skills Anticipation and Prioritization of Skills Requirements (SAPSR) Framework.

Developed by the Technical Education and Skills Development Authority (TESDA), this framework aims to bridge the skills gap between the workforce and employer requirements.

“As early as the 1970s, the Philippine higher education system was producing a supply of college graduates higher than the economy’s capacity to absorb highly educated workers,” the authors observed.

Despite this, recent evidence shows that 65 percent of graduates fail to secure jobs in their desired sectors due to skill deficiencies.

Additionally, many college and technical education graduates find themselves either overqualified or underqualified for their roles.

The study found that skills mismatches lead to lower wages, reduced job satisfaction, decreased productivity, and increased unemployment, which in turn diminishes the economy’s competitiveness.

To address these challenges, the authors recommend enhancing institutional collaboration, particularly through establishing a standardized skills taxonomy to support the SAPSR Framework. This would involve organizing and classifying skills, improving data accuracy, and facilitating expert discussions.

The Department of Labor and Employment (DOLE) is urged to lead this initiative in partnership with TESDA, the Commission on Higher Education, the Department of Education, the Philippine Statistics Authority, the Department of Trade and Industry, and the National Economic and Development Authority, alongside private sector stakeholders.

“Involving these stakeholders ensures that sectoral inputs and concerns are accounted for, increasing commitments to participating and sustaining data collection initiatives,” stressed the authors.

Effective skills-occupation mapping using standardized classifications like the Philippine Standard Occupational Classification (PSOC) was also identified as crucial.

Improved data dissemination and stakeholder engagement through modern communication tools such as websites and dashboards were emphasized to ensure policymakers, students, jobseekers, and the academic community can make informed decisions.

The study further urges the government to enhance the Public Employment Service Office (PESO) and build stronger partnerships with local higher education institutions to broaden the reach and effectiveness of the SAPSR.

Local government units play a vital role in improving job matching and service delivery, with investments in local capacity and data analysis expertise being essential for long-term success.

The authors highlighted the potential benefits of international partnerships, which can offer technical assistance, funding, and knowledge sharing, facilitating a more effective and sustainable labor market information system.

By addressing these issues through a coordinated and comprehensive framework, the Philippine labor market can better align educational outcomes with economic needs, fostering a more competitive and satisfied workforce.