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Michael G. Jacobides Headshot

How Europe Is Betraying Its Children

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I recently participated in a debate organized by the Economist on whether the new generation has the skills it needs to succeed in tomorrow's world. I thought I had the easy job of arguing that, especially in countries like Greece (where the event took place), there is a serious skill gap, with the educational and vocational training being seriously out of date and misdirected.

The argument in favour of the motion, I reckoned, was straightforward. First, schools in many of the Old World countries, and certainly in the European South, still prioritize memorizing over critical thought; we still obsess with teaching technical skills as opposed to fostering the ability to adapt, add and capture value in a shifting economic landscape. Universities, in many a European country, are still neglecting the realities that graduates will face, producing degrees better suited to a generation ago.

Of course, all this is perfectly understandable. These school systems were built at a time when information was scarce and valuable, and thus obtaining vast amounts of it through memorization, was a useful skill. And Universities had evolved to serve the needs of a different polity and economy: skilled professionals destined to work in heavily structured societies.

A degree was often the license to practice a privileged profession such as law or medicine, and humanities training was the tool to propel young graduates into the white collar workforce. Vocational training was, by and large, linked to the system of professions, themselves a descendant of the guild system. In other words, education was based on offering the brightest (or most fortunate) in society access to the land of privilege, bestowed by excluding most while anointing some.

This world no longer exists. Professions have lost their monopoly, guilds' privileges are on their way out, sectors have unbundled, competition has become global, and value creation is the name of the game. With China making a massive push in its academic system, and as the Asian scores in aptitude tests reveal the shifting geography of the talent pool, the Old World cannot afford its old world habits.

On the corporate level, as careers shorten and the nature of work evolves, the skills to succeed become ever more complex. Sadly, today's youth is still kept behind by an antiquated educational system, and a reluctance of corporates to invest in developing their workforce. And on top of that, in Europe, most school and Universities' lack of financial independence has hit hard in a time of fiscal austerity, depriving them of the resources and agility to react and adapt.

They also face tough governance problems, shown most acutely in places like Greece, where the Rector and the association of administrative employees can literally shut the biggest and oldest university down, as a protest on the mere prospect of having their own jobs redesigned. Dinosaurs die hard, and can wreak havoc on their way out.

It isn't just the educational system that's at fault. A recent BusinessRoundtable study of employers found that most complain that they can't find the right people. Not because they can't read, or lack computer or job-specific skills but because they lack critical thinking, critical problem solving and teamwork. Perhaps worse, they also lack professionalism, adaptability, and personal accountability for work. These are skills that the educational system isn't geared to deliver but they are precisely what the new generation must necessarily develop.

Given this context, I was mesmerized by the fact that 51% of the audience in the Economist debate voted for the view that the young generation does have the skills needed. Now, this could be the result of debating prowess of my opponent, Steve Bainbridge, who played up the need to believe in the younger generation, and of the value of hope, in an auditorium of a crisis-striken country.

But it just might be something deeper: a reflection of just how hard it is to recognize some uncomfortable truths, especially when we have no ready solution to offer. Yet, what could happen if we keep confusing wishful thinking with optimism? Most probably, a wasted generation and, for sure, further loss of competitiveness. And, on the personal level, the biggest drama for parents in plighted countries, who sacrifice all they have for the education of their children, is the realization that they may be making a bad investment. Unwavering faith in their offspring and their future may be detrimental for their ability to succeed.

Perhaps worst of all is the likelihood that this trend will make an uneven society even worse. Those who can attend the best universities, or go to the best business schools, will be able to cope effectively. But this will exacerbate societal imbalances, helping the 1% "in the know", while leaving the majority behind. Our lack of courage in dealing with the skill gaps risks hurting the Old World and making it more uneven.

This isn't an easy fight. It takes courage to accept the problem, and even more courage to address it, with entrenched interests as well as skill gaps in the educational system. But it's an important fight, if we want to regain both prosperity and balance.