Responsibilities for adult career guidance are shared among multiple ministries, levels of government and social partners. Strong coordination mechanisms can facilitate seamless and high-quality service delivery, reduce duplication and prevent gaps in provision. This chapter provides an overview of how OECD countries promote coordination across the many actors involved in adult career guidance. It also discusses how funding of career guidance is shared between governments, adults and employers, and provides examples of policies to reduce the cost of career guidance for those who cannot afford to pay.
Career Guidance for Adults in a Changing World of Work
Getting Skills Right
4. Governance and funding
Abstract
In Brief
Adult career guidance is governed by multiple ministries and levels of government. Effective coordination mechanisms can improve the quality of career guidance services and reduce duplication of effort. Given that career guidance has both public and private benefits, some cost-sharing between government, adults and employers is desirable. The main findings from this chapter are:
The three national bodies most commonly responsible for adult career guidance are the Ministry of Labour, the Ministry of Education and the public employment service. To promote horizontal cooperation, countries employ formal mechanisms like advisory groups or legislation, or assign the responsibility for coordination to dedicated bodies. Informal approaches are also used, including working groups or ad-hoc cooperation on a particular aspect of career guidance (e.g. the development of online services or quality standards).
Responsibilities for adult career guidance are often shared across national, regional and local levels of government. National legislation, strategies and guidelines provide leadership on how adult career guidance is governed. 19 out of 21 countries surveyed reported that they had some kind of strategic document around career guidance. The majority of these strategies were embedded in wider skill or employment strategies. Other mechanisms for promoting vertical cooperation include national symposia, working groups and informal information sharing.
Social partners are often involved in the governance of adult career guidance through working groups or permanent advisory bodies. Professional associations are also involved in various ways, including supporting the professional development of career guidance advisors, and engaging with government.
Only one in four adults (26%) bear the cost of career guidance services themselves. The majority (74%) of adults who use career guidance services do not pay for them (either partially or fully). Consistent with this, cost does not represent a significant barrier to accessing career guidance services. Only 4% of non-users said cost was a barrier. The unemployed and those outside of the labour force can generally access free guidance through the public employment service and adults enrolled in education also have access to free guidance. Employed adults who are not in education are generally expected to contribute to the cost of career guidance, but vouchers and other subsidies are available in some OECD countries to reduce this cost, and sometimes their employer provides free guidance.
Most career guidance services are funded partially or fully by governments, though international data on public spending are limited. Career guidance is often grouped together with general spending on education and training or public employment services.
Employers tend to provide free career guidance for certain employees in certain contexts. They may provide internal career support for key talent groups in order to promote productivity and employee retention, and they may provide outplacement services to laid off workers in order to meet legal requirements. Making career guidance an allowable expenditure under training levies intended for education and training, or providing public subsidies to employers who offer impartial career guidance are possible ways to encourage cost sharing by employers.
Introduction
Responsibilities for adult career guidance are shared across ministries and levels of government, as well as social partners and other stakeholders. Coordination mechanisms can facilitate seamless and high-quality service delivery, reduce duplication and prevent gaps in provision.
Career guidance has both private and public benefits. As such, a combination of government subsidies, employer contributions, and individuals paying according to their means is generally viewed as a sustainable funding model.
Section 4.1 of this chapter examines how OECD countries coordinate career guidance horizontally across ministries; vertically between levels of government; and between government and other stakeholders. Section 4.2 looks at the role of career guidance strategies at promoting coordination. Section 4.3 discusses how the cost of career guidance is shared between governments, adults and employers. Section 4.4 provides examples of policy options used by OECD countries to defray the cost of career guidance for those who most need it, and to encourage cost sharing.
4.1. How is adult career guidance governed?
With responsibility for career guidance split across ministries and levels of government, strong coordination is needed. This section describes both the formal and informal mechanisms used across OECD countries to facilitate such coordination horizontally across ministries and vertically between levels of government. It also discusses the involvement of other stakeholders outside of government, including the social partners and professional associations.
4.1.1. Horizontal coordination between ministries
Career guidance for adults sits at the intersection of employment and education policy, and is therefore not always the responsibility of one single ministry. It differs in this way from career guidance for young people, which generally falls to the Ministry of Education. This can raise challenges for ensuring a seamless coordination of the delivery of career guidance across Ministries and preventing duplication or gaps in provision.
The three most common bodies responsible for adult career guidance are the Ministry of Labour, the Ministry of Education and the public employment service (PES) (Figure 4.1). The Ministry of Labour and the PES have jurisdiction over guidance helping unemployed or at-risk adults to find work or improve their employability. The Ministry of Education oversees education guidance that relates to selecting formal adult learning opportunities (e.g. basic skills training, second chance programmes and university courses for adults).
Figure 4.1. Bodies involved in governance of adult career guidance
Note: 21 countries responded to the question, “Which actors are responsible for the development of career guidance policy in your country?”
Source: OECD 2020 Policy Questionnaire, ‘Career Guidance for Adults’.
With distinct objectives and budgets, coordination between ministries of education and labour can be challenging. In federal systems, coordination between education and labour ministries is further complicated by the division of responsibility across levels of government. For instance, in Germany, the federal states have responsibility for guidance in education, while employment and vocational guidance is governed at the central level by the PES.
Career guidance touches other policy domains beyond education and employment, and other ministries may be involved as well, including those relating to immigration, innovation and health. Immigrants meet with career guidance advisors who support their integration into the labour market. To the extent that it encourages upskilling and retraining, career guidance can be a component of innovation policy. In some countries, it also factors into health policy given its social and psychological benefits.
Good coordination between ministries involved in career guidance reduces duplication, strengthens the overall quality of provision, and avoids gaps in provision.
Some OECD countries have adopted formal mechanisms for inter-ministerial cooperation, such as permanent advisory bodies. Inter-ministerial advisory bodies often set aside budgets at the national level for coordination. The Czech Republic’s National Guidance Forum (NGF) is an advisory body established in 2010 by the Minister of Education, Youth and Sports and the Minister of Labour and Social Affairs. Through working groups and project partnerships, the NGF promotes inter-ministerial coordination on the quality of lifelong guidance services, as well as other lifelong guidance activities and project plans. In a similar vein, Germany’s National Forum for Educational, Vocational and Employment-oriented Guidance (Nationales Forum Beratung, Beruf, und Beschaftigung) provides a national platform for exchange, cooperation and quality development. In Ireland, the biannual National Forum on Guidance supports collaboration and co-operation across the guidance sectors (schools, further education and training, social welfare / public employment services, higher education and professional bodies). The Forum is organised by the National Centre for Guidance in Ireland (Box 4.1). While the Forum supports cooperation, it is voluntary and cannot mandate any change in practice.
In some countries, dedicated bodies are assigned the role of coordinating career guidance. Sometimes these bodies have a wider mandate of coordinating skill and training policies, and career guidance is one part of that mandate. Skills Norway and Skills Development Scotland are two examples (see Box 4.1), along with France Compétences. Other times the dedicated body has a sole mandate of coordinating career guidance. This is the case with Ireland’s National Centre for Guidance in Education (Box 4.1), for example. Dedicated bodies bring leadership and momentum to coordination, and usually have a budget set aside for carrying out activities. Relative to ministries, they may be perceived as more impartial and thus have greater success engaging stakeholders and achieving consensus. For instance, France Compétences is a public body with a quadripartite structure that includes representatives from national government, regional government, trade unions and employer organisations. It consults with these stakeholders to monitor outcomes and improve quality assurance in career guidance, for instance, by establishing a competence framework for career guidance advisors.
Coordination between ministries and sectors is sometimes enforced by legislation. In Finland, cross-sectoral service delivery (PES, health and social services, schools) is required by legislation, and practitioners are expected to be involved in service delivery and coordinating networks (Cedefop, 2009[1]). The Finnish One-Stop Guidance Centres have successfully achieved horizontal policy integration, whereby a single point of access facilitates information and referral to the right service (European Commission, 2020[2]).
Other coordination mechanisms are less formal. Working groups are a nimble coordination mechanism, and can be erected and dismantled as needed. The National Lifelong Guidance working group in Finland is co-chaired by the Ministry of Education and Culture and the Ministry of Economic Affairs and Employment (Cedefop, 2020[3]). It is responsible for updating and implementing Finland’s cross-ministerial strategy for lifelong guidance which has several objectives, including making guidance accessible for all, strengthening competences of career guidance advisors, developing a quality assurance system, and supporting individual career management skills.
In some countries, there is inter-ministerial cooperation on a particular project or on a specific aspect of adult career guidance. In Poland, the Ministries of Education and Labour cooperate in the implementation of the European Commission’s Euroguidance project, which aims to support professional and educational mobility of citizens and to develop vocational guidance in European countries. Poland’s ministries of education and labour worked jointly to establish quality standards for career counselling and career information in schools and elsewhere (Cedefop, 2009[1]). In Finland, a separate cross-ministerial working group oversees the development of integrated online services for career guidance.
Box 4.1. Dedicated bodies responsible for coordinating adult career guidance
Ireland
Ireland’s National Centre for Guidance in Education (NCGE) is an agency of the Department of Education and Skills, with responsibility to support and develop guidance practice in all areas of education and to inform national guidance policy. The centre works with key stakeholders to ensure the promotion of quality guidance. It provides guidelines, supports innovations, organises continuing professional development for career guidance advisors and carries out national surveys on guidance practice and needs. It also hosts the National Forum on Guidance and Euroguidance Ireland.
Norway
Skills Norway is the directorate for lifelong learning in Norway with a mandate from the Norwegian Ministry of Education and Research. The directorate is responsible for strengthening coordination and cooperation, widening access, and increasing the quality of lifelong guidance services. To strengthen cross-sectoral cooperation, Skills Norway chairs a National Forum for Career Guidance that brings together a variety of stakeholders. At the initiative of Skills Norway, two new laws concerning access to career guidance services were recently adopted: the first gives county municipalities a duty to offer career guidance services to all citizens, and the second gives refugees a right to participate in career guidance. To strengthen the quality of services in all sectors, Skills Norway developed a national quality framework. The framework consists of four elements: competence standards for practitioners; a Career Management Skills framework to inspire practitioners to deliver better career learning; ethical guidelines; and tools to enable more systematic quality assurance at both service and policy levels. Skills Norway has also recently launched a national digital career guidance service.
Scotland
Skills Development Scotland (SDS) is the national body responsible for skills policies. One of its mandates is to provide career services for all age groups. Career services are delivered in schools, in centres and online and are shaped by national strategies on guidance and the overall national skills policy. SDS promotes continuous professional development of career guidance advisors, collects national data to monitor the quality of services, and cooperates with a wide range of agencies and stakeholders in service provision. SDS monitors the development of skills intelligence to understand the current and future demand of skills across the country and makes these insights available to employers, career guidance advisors and individuals. It maintains up-to-date information on the full range of routes and pathways that can be taken into careers, including options for work-based learning. This information informs the development of their resources, such as workshop materials and online digital content. SDS also commissions research relating to skills and employability and uses the findings to inform policy and practice.
Source: OECD 2020 Policy Questionnaire ‘Career Guidance for Adults’; European Commission (2020[2]), “Lifelong guidance policy and practice in the EU: trends, challenges and opportunities; https://www.skillsdevelopmentscotland.co.uk/; https://www.kompetansenorge.no/English/About-Skills-Norway; http://ncge.ie;
4.1.2. Vertical coordination between levels of government
Responsibilities for adult career guidance are often shared across levels of government, including national, regional and local levels (Figure 4.1). In centralised systems, the national government is responsible for both policy design and implementation. In more decentralised systems, the national government designs policies while the regional or local governments look after implementation. In federal systems, the national government defines broad policy objectives, while sub-national governments assume the bulk of responsibility for both policy design and implementation.
Each approach has strengths and weaknesses. Centralised systems have the advantage of clear leadership and accountability, but may suffer from poor alignment between national and local priorities, or a gap between national priorities and local implementation. Experimentation at the local level may also be stifled in a centralised system. More decentralised systems have the potential for improved alignment between policies and local needs. With their established networks to local employers and services – like recognition of prior learning and training provision – local governments can help to design effective career guidance policies adapted to local needs. But decentralised systems come with a greater risk of inequalities in provision, funding and quality of programmes across the country. Inefficiencies may also be greater due to poor coordination of effort.
In some countries, national legislation provides leadership on how adult career guidance should be implemented. In Sweden, career guidance policy is decentralised but nationally regulated by the School Act. The Swedish National Agency for Education (Skolverket) has established general guidelines on career education and guidance to ensure consistent implementation of the legislation. This model promotes consistent quality in the delivery of services across the country, while allowing for innovative solutions at the local level. A similar model applies in France. The State and regions annually sign an agreement specifying how they will coordinate regional activities relating to employment and vocational guidance and training. In Canada, the federal government contributes to the funding of provincial and territorial skills training and employment services through bilateral labour market agreements. The provinces and territories then design and deliver programmes to meet the needs of their local labour markets.
Another approach pairs national strategies or guidelines with local implementation. In Finland, regional authorities support the design and implementation of career guidance services as well as quality assurance. They are responsible for ensuring that their services meet guidelines established by the National Lifelong Career Guidance working group (European Commission, 2020[2]). In Chile, the Ministry of Labour through the National Service of Skills and Work (Servicio Nacional de Capacitación y Empleo) are responsible for the design and monitoring of the country’s career guidance strategy. Local government and municipal offices of labour integration (Oficinas Municipales de Intermediación Laboral, OMIL) take care of implementation.
Working groups or separate bodies are other ways to support vertical coordination. Spain’s Sectoral Conference on Employment and Labour Affairs supports coordination and cooperation between the national administration and the autonomous communities in matters of employment policy and vocational training for employment, including career guidance. In Belgium, central and territorial coordination of career guidance is facilitated by a steering committee. In Canada, the Future Skills Centre is a pan-Canadian independent innovation and applied research centre that prototypes, tests and evaluates innovative approaches to skills development and assessment. The Centre achieves this by funding innovation projects, some of which relate to career guidance. Evidence generated from these projects will be shared with federal, provincial and territorial governments, as well as frontline service partners. The goal of sharing this evidence is to transform policy and programme design; successful approaches may be scaled up or piloted in other provinces.
Some coordination mechanisms are focused on information sharing. Chile’s Regional Directorates provide regular technical assistance to local level bodies responsible for career guidance. This regular two‑way information sharing helps the central government better understand local needs in designing policies for career guidance. National symposia like the UK’s annual National Career Guidance Show have a similar purpose. They bring together policy makers and practitioners to document examples of good practice, and help central government better understand local needs.
4.1.3. Engaging stakeholders in setting career guidance policy
In many countries, social partners – both trade unions and employer groups – participate in working groups to review policies around career guidance for adults. In Estonia, a working group called “career guidance forum” is the main mechanism for coordinating career guidance services. Members include representatives from ministries, youth and student organisations, schools, the career counsellors association, and employers. Another working group focuses on adult education, with career guidance for adults as one of its focus areas. In Denmark, working groups made up of social partners and education institutions inform the development of online portals. Also in Denmark, the government meets every three years with the PES and employer groups to discuss how to support low-educated individuals in finding work, as well as how to support longer working lives (European Commission, 2020[2]).
Social partners can also influence government priority setting through permanent advisory bodies. Spain’s tripartite advisory body (General Council of the National Employment System) coordinates on employment policy and vocational training in the workplace. Membership includes representatives from the autonomous communities, the national government, business and trade unions. Austria’s lifelong guidance strategy was jointly developed by the Federal Ministry of Education, Science and Research (BMBWF), the public employment service (AMF) and social partners. The social partners also play an advisory role in the steering group of the Austrian Initiative for Adult Education. The National Careers Council in England (United Kingdom) provides advice to the government on careers provision for young people and adults, and membership in the council is drawn from business, education, voluntary/community and careers sectors.
Employers and employer groups are often engaged by government to share labour market information and insights in the context of career guidance. In Flanders, private companies are encouraged to feed their vacancies to the public employment service, creating a single and transparent repository of CVs and vacancies.
In addition to the social partners, professional associations are an important stakeholder in the governance of career guidance in some countries. They support professional development and training of career guidance advisors; collect and share LMI; facilitate exchange of good practice; establish guidelines, ethics and standards; participate in fora; and engage government. The Slovenian Ministry of Education, Science and Sport created a national cross-sectoral professional group in 2011 to review existing practices in lifelong learning information and guidance and to make policy recommendations. Composed of experts and stakeholders, the group is also developing professional standards for career guidance advisors. The group has little power, however, to institute strategic changes to lifelong guidance policy.
4.2. What is the role of career guidance strategies?
A career guidance strategy is a national or regional stance on career guidance that sets out the vision, objectives and priorities for action. Ideally, it defines career guidance provision across different contexts, including who is responsible for delivering what, eligibility, quality mechanisms, and funding. A career guidance strategy provides leadership to all actors in the system, and helps to build policy coherence. It is often the product of a long process of consultations with many stakeholders. Nearly all countries that responded to the policy questionnaire have some type of policy document relating to career guidance, though not all meet the criteria for a career guidance strategy (Table 4.1).
For the most part, career guidance strategies are not stand-alone strategies, but are embedded in wider lifelong learning or employment strategies. Only a handful of countries have stand-alone career guidance strategies (Greece, Italy, Korea, Turkey). Career guidance is often viewed as crucial for the success of lifelong learning and employment strategies (OECD, 2017[4]; European Commission, 2020[2]). Indeed, guidance has been identified as necessary to the success of programmes to financially encourage adult learning, particularly in reaching lower-skilled adults (OECD, 2019[5]). While governments and employers can provide opportunities for adults to continue learning over their working lives, it is ultimately up to the individual to make decisions about what they learn. Whether countries achieve desired outcomes from lifelong learning strategies, like improved productivity and social well-being, depends on the quality of individual decisions. This makes effective career guidance a necessary component of successful lifelong learning strategies.
With a dedicated source of funding, career guidance strategies are more likely to succeed. As part of their tripartite agreement, the Danish Government and social partners set aside over DKK 400 million towards upskilling both unskilled and skilled workers. Part of this budget is allocated to career guidance activities, including outreach, screenings, and recognition of prior learning.
Quantitative targets in career guidance strategies establish an objective metric for assessing performance, and can be either outcome or process focused. Outcome targets often relate to adult learning or labour market participation. In Slovenia, for instance, one of the targets of the adult learning strategy that includes career guidance services is to raise the share of adults who participate in formal and non-formal education to the EU average. Targets can also focus on process, or the way in which services are delivered. As part of the career guidance strategy in Flanders (Belgium) that integrates job search services with career services, the VDAB aims to interview new unemployed adults within the first 3 months after they register for unemployment.
Rigorous monitoring of career guidance strategies enables countries to assess their performance against qualitative or quantitative targets and to make course corrections as needed. In Ireland, the National Centre for Guidance in Education provides annual reports to the Department of Education and Skills and SOLAS, the state agency responsible for further education and training. The reports monitor progress towards meeting objectives set out in the Further Education and Training Strategy, including building an integrated and impartial career guidance service. The reports track various indicators: the number of beneficiaries, the share of beneficiaries who progress to employment or further training, and participation by target group (e.g. disadvantaged men/women, lone parents, long-term unemployed). An independent review of these reports resulted in recommendations that will form the basis of the subsequent strategy.
Table 4.1. Examples of career guidance strategies, OECD countries
Note: / indicates that the name of the strategy was not provided.
Source: OECD 2020 Policy Questionnaire, ‘Career Guidance for Adults’.
4.3. How is career guidance for adults funded?
How should the cost of career guidance be shared between governments, adults and employers? Who should pay is largely a question of who benefits and who can afford to pay. Adults are a direct beneficiary of career guidance, as it supports their progression in learning and work. If career guidance were seen purely as an individual private good, then it could be argued that adults should pay for it themselves. However, career guidance yields public benefits. It supports the effective functioning of labour and learning markets, and contributes to a range of social equity goals. Employers also benefit. Providing career development opportunities to their employees yields higher employee engagement and retention, skills development, and improved skill matches within their company.
Availability of cross-country data on funding of adult career guidance is limited for several reasons. Aggregating the expenditures of the many different public actors who contribute is challenging. Career guidance rarely has its own budget category and tends to be grouped together with overall spending on education and training or public employment services. Consistency in how career guidance services are defined is often lacking. Systematic efforts to collect information on public spending on adult career guidance have therefore not yet been conducted at the international level.
4.3.1. Adults’ out-of-pocket spending
Adults are the direct beneficiaries of career guidance services. They stand to progress faster in their learning and work as they become more informed about options available to them. They also experience psychological and learning benefits, including stronger self-esteem, more clarity about their future direction, and improved career management skills.
Despite the direct benefits to adults, available evidence suggests that users do not usually pay out of pocket for the service. Based on survey evidence from the SCGA, the majority (74%) of adults who use career guidance services do not pay for them. Only 26% of users report having paid fully or partially for the career guidance services they received (Figure 4.2). Adults in European countries (Germany, France and Italy) were least likely to pay, compared with those in non-European countries (Chile, New Zealand and the United States). This difference can be explained by the higher use of PES-provided career guidance services in European countries (Chapter 2), as PES-provided services are usually provided at no cost.
Figure 4.2. Adults’ financial contribution to career guidance
Note: The average includes six OECD countries: Chile, France, Germany, Italy, New Zealand and the United States. Data refer to the last time the respondent spoke to a career guidance advisor.
Source: OECD 2020 Survey of Career Guidance for Adults (SCGA).
Furthermore, cost does not represent a significant barrier to accessing career guidance services. Among adults who did not use career guidance in the past five years, only 4% said the service was too costly (Chapter 1). Non-users were much more likely to cite reasons other than cost for not accessing career guidance, such as not feeling like they needed it (57%) or not knowing that the service existed (20%).
Cost is a factor in selecting a provider; however, it is not the most important factor. As discussed in Chapter 2, many adults do not have a choice about which provider they choose: either they are required to go to a particular provider (23%), perhaps as directed by the PES; or they are not aware of any other provider (22%). When they do have a choice, 14% of adult users of career guidance selected a given provider because it was the cheapest. But other factors are more important than cost, including proximity to place of residence (22%), and having a recommendation from a friend or family member (16%).
Career guidance is free in certain contexts. Across OECD countries, career guidance services are generally free for the unemployed and those at risk of unemployment through the PES. In some countries, employed adults can also access free career guidance through the PES. Guidance is often free for those enrolled in education or for recent graduates. Adults who are employed and out of school must generally contribute to the cost of career guidance from private providers. Employers sometimes provide career guidance for their employees, but only under a narrow set of circumstances, i.e. when they are members of key talent groups or as part of outplacement services.
According to the SCGA, permanent employees are the group most likely to contribute out-of-pocket to the cost of career guidance, followed by employees without a contract, the self-employed and temporary employees (Figure 4.3). Adults are most likely to pay for career guidance services from either a private provider or from an employer group (Figure 4.4). Adults outside of the labour force and the unemployed are least likely to contribute out-of-pocket. This makes sense given the substantial public benefit to these groups receiving career guidance, and possibly re-entering employment.
The section below on policy options discusses the use of vouchers and other subsidies to reduce the out-of-pocket cost for adults, particularly those with lower ability to pay.
Figure 4.3. Adults’ financial contribution to career guidance, by employment status
Note: Average for the six countries covered by the SCGA: Chile, France, Germany, Italy, New Zealand and the United States. Data refer to the last time the respondent spoke to a career guidance advisor.
Source: OECD 2020 Survey of Career Guidance for Adults (SCGA).
Figure 4.4. Adults’ financial contribution to career guidance, by provider
Note: Average for the six countries covered by the SCGA: Chile, France, Germany, Italy, New Zealand and the United States. Data refer to the last time the respondent spoke to a career guidance advisor.
Source: OECD 2020 Survey of Career Guidance for Adults (SCGA).
4.3.2. Government contribution to funding
Most career guidance services are funded partially or fully by governments, whether at national, regional or local level. Public spending on career guidance is justified on the basis that it provides public benefits as well as private benefits. Watts (2008[6]) identifies three public goals that career guidance helps to achieve: learning, labour market and social equity goals. If individuals make well-informed decisions, the large public investments in education and training are likely to yield higher returns. An important caveat, as identified by an evaluation of an education guidance pilot in Europe (Carpentieri et al., 2018[7]), is that publicly funded education guidance is only a good investment if funding is also available for adult education. Labour market goals are achieved by improving the match between the demand and supply of labour. Finally, career guidance can advance social equity goals by raising the career aspirations of disadvantaged individuals and supporting them in accessing employment and education opportunities that otherwise may have been denied to them.
As previously noted, international data on public spending on career guidance are limited. The only source of cross-country data is PES expenditure, and this is only an approximation. Average OECD expenditure on public employment services and administration is 0.15% of GDP, and ranges from 0.02% in the United States to 0.4% of GDP in Denmark (Figure 4.5). These estimates include services related to career guidance, such as counselling, information services and referrals to opportunities for work. But they also include other expenses not directly related to career guidance, including financial assistance to help with the cost of job search and mobility to take up work.
Figure 4.5. Government spending on public employment services and administration, 2017 or latest available year
Note: Government spending on career guidance is approximated by “Public Employment Services and administration”, which includes placement and related services, benefit administration and other services. Placement and related services include open information services, referral to opportunities for work, training and other forms of assistance, counselling and case management of jobseekers, financial assistance with the costs of job search or mobility to take up work, and job brokerage and related services for employers, if spending on these functions can be separately identified. Services provided by the main public employment service and by other publicly funded bodies are included.
Source: OECD Employment and Labour Market Statistics.
Moreover, since career guidance is only one of many services offered by the PES, only a portion of public resources spent on the PES are devoted to career guidance. The size of PES administration spending relative to total PES spending (including activities like training, employment incentives, out-of-work income support) varies across countries. It accounts for 11.3% of total PES spending in OECD countries on average, and ranges from 3.5% in Portugal to 27.9% in Germany (Figure 4.5).
International data on public spending on career guidance by educational institutions is also limited. Educational institutions often provide free career guidance for current students or recent graduates. Public spending on career guidance in education institutions tends to be grouped together with overall spending on education and training. As a result, cross-country data that captures public spending on career guidance in educational institutions is not available.
Despite the lack of international data, some idea of the size of public subsidies can be gleaned from national sources. In France, the government subsidises the full cost of a “skills assessment” (bilan de compétences) when an individual uses it to mobilise their training rights as part of their individual training account (compte personnel de formation, CPF). Career guidance services are provided as part of the skills assessment, which costs EUR 1 460 on average.1
4.3.3. Employers’ contribution to funding
Employers can also benefit from the provision of career guidance to their employees, which would explain their willingness to contribute to its funding. The process of career support used within organisations is usually referred to as “career development” or “career management” rather than career guidance.2 When they provide career development opportunities to their staff, employers stand to benefit from higher employee engagement and retention, skills development, and improved skill matches as employees move to where their skills are most needed within the company (Cedefop, 2008[8]).
Research from Cedefop (2008[8]) found that European employers pay for certain types of within-firm career support. They frequently pay for coaching, assessment and development support for individuals from key talent groups, such as senior managers or recent graduates. They also regularly pay for employees to access advice and support on learning and development activities. When laying off employees, they also fund outplacement services as part of severance packages to respect employment legislation. Outplacement services are external career guidance services to help the employee find new employment quickly. Generally, employers do not provide impartial career guidance – defined as advice on opportunities to advance in an individual’s career both inside and outside their current place of employment – unless there is a clear incentive.
Unfortunately, there is no international data on employers’ spending on career development and guidance. Spending on career development is often grouped together with training as part of a firm’s “learning and development” budget.
There may not be a strong rationale for employers to contribute to the cost of external, impartial career guidance. On the one hand, adults who are more informed about their unique skill set and aspirations can find better skill matches on the labour market, thus lowering costly skills mismatches. Employers benefit from having access to a well-informed workforce who seek out jobs that match well with their skills and aspirations. On the other hand, the departure of a productive employee following impartial career guidance can be costly for an employer.
4.4. Which policies can support adequate funding and cost-sharing?
The 2004 OECD study on career guidance and public policy advocated for a mixed funding approach, whereby services for young people and unemployed adults are free, and services for employed adults are charged (OECD, 2004[9]). This approach seems to have been adopted by several countries, including those countries covered by the SCGA (Figure 4.3). However, not all employed adults have an equal ability to pay for career guidance. Furthermore, there are important social equity reasons to subsidise the cost of career guidance for employed workers whose jobs are at risk of automation, for adults in non-standard working arrangements who may have less access to career guidance and training opportunities, or for low-skilled adults who require upskilling or retraining to remain employable.
In countries that enshrine the right to career guidance in legislation, public funding often follows. In a 2017 OECD policy questionnaire, 19 countries/regions answered the question about whether a legal right to counselling existed in their country (OECD, 2017[4]). Nine said that such a right existed and that it was universal (Belgium [Flemish and German-speaking communities], Estonia, France, Korea, Latvia, Lithuania, Poland and Portugal), four had a legal right that was restricted to certain groups (Belgium [Wallonia], Greece, Hungary and Sweden), and five had no such legal right (Austria, Norway, Japan, the Czech Republic and Italy). Norway has since adopted new legislation. By law, county municipalities must offer career guidance services to all citizens living in the county, and refugees now have a duty and a right to participate in career guidance when attending an introduction programme.
Free career guidance is available for employed adults in some countries on the basis of contracts between the government and providers. In France, the Conseil en évolution professionnelle (CEP) gives workers and jobseekers the right to free and impartial information, advice and guidance throughout their working lives. In Austria, free educational guidance for adults is offered in each of the nine federal provinces within the framework of the regional networks for educational and vocational guidance.
Individual vouchers for career guidance help to reduce the cost for adults, while also encouraging them to share in the cost. This type of quasi-market approach may also promote the growth of private markets. In Flanders (Belgium), for example, a career guidance voucher allows workers to buy EUR 250 worth of career guidance with a registered provider every year. The adult is responsible for paying half the cost of the service. A potential disadvantage with the voucher system is that forecasting public budgets is not straightforward. Once a price is set for the voucher, the total public cost depends on demand, which can be hard to anticipate. Box 4.2 provides examples of career guidance vouchers.
Another approach is to make career guidance an allowable expenditure under financial incentives geared towards lifelong learning. For instance, Greece and Germany offer vouchers that can be used towards either training programmes or guidance sessions. In France, the bilan des compétences (Skills Assessment) is an allowable expenditure under the compte personnel de formation (CPF, Individual Training Account). Since the CPF is funded by an employer levy on medium and large-sized firms (OECD, 2019[5]), this is also an effective way to have employers share in the cost of guidance. When an employee uses the CPF for a skills assessment conducted outside of working hours, they do not need to inform their employer.
Some countries target subsidies for career guidance at vulnerable groups of employed workers. The Netherlands experimented with providing a temporary subsidy for personal career guidance to persons aged 45+ who work at least 12 hours per week (Ontwikkeladvies). The pilot is now being evaluated. Similarly, Australia introduced the Skills Checkpoint for Older Workers programme in 2018, which provides free career guidance for adults aged 45‑70 who are employed and at risk of entering the income support system or who have recently become unemployed. In Korea, career guidance for low-income employed adults (earning less than 60% of the median income) is publicly subsidised.
Governments can provide subsidies to encourage employers to provide career guidance opportunities to their employees. Until 2018 in Japan, employers who introduced the self-career dock system could receive a government subsidy to provide both individual and group counselling (OECD, 2021[10]).
Opportunity costs for career guidance tend to be low, and public funding to compensate for the time away from work is uncommon. Speaking with a career guidance advisor requires a considerably smaller time investment than completing a training programme – generally a couple of hours versus 30 or more hours for training.3 Whereas not having enough time was the single most important barrier cited by adults who did not train (43% of adults, OECD (2019[11])),4 only 11% of non-users report time constraints as the reason they did not consult a career guidance advisor. Paid leave to visit a career guidance advisor is rare. However, a few countries allow workers to apply paid leave for education and training purposes towards career guidance visits (Box 4.3).
With responsibilities for adult career guidance split between ministries of education and labour and levels of government, effective cost-sharing models are needed. In the United States, the central government provides funding to state governments to operate PES according to an established formula based on the state’s relative share of unemployment. Some programmes require collaboration and/or cost-sharing with local agencies to secure central funding.
To reduce overall funding costs for government, many countries have adopted a delivery model that takes advantage of technology. For those with digital skills, online career resources can enable self-help, thereby freeing up resources to provide assistance to those who most need it. Online provision of career guidance services is discussed in Chapters 1 and 2.
Box 4.2. Career guidance vouchers
Flanders
Flanders (Belgium) offers training vouchers for employees working in Flanders or Brussels, which can also be used for career guidance sessions. An individual can purchase up to EUR 250 in training vouchers per calendar year, and the Flemish Government funds half of it. In certain cases, additional financial support can be requested. To be eligible for a voucher, an employee must have worked a minimum number of hours with a given employer.
Germany
The German Federal Employment Agency (Bundesagentur für Arbeit) certifies that a job seeker or an unemployed person meets the eligibility requirements for activation and occupational integration measures by granting him or her an “activation and placement voucher” (Aktivierungs- und Vermittlungsgutschein). The placement officer defines the objective of the voucher and attaches a funding commitment. The job seeker can then choose between guidance counselling and training courses and use the voucher to pay the provider directly.
Greece
With a mandate from the Greek Ministry of Labour, the Greek Manpower Organization (OAED) offers young people (including young adults, aged 15‑29) vouchers, which can be exchanged for training programmes for work or for specialised career guidance programmes to support transition to the labour market. These vouchers are part of a broad range of support from the state, including job subsidies for employers, professional experience opportunities for unemployed young people and entrepreneurship programs.
Source: OECD 2020 Policy Questionnaire, ‘Career Guidance for Adults’, www.arbeitsagentur.de/aktivierungs-vermittlungsgutschein-avgs.
Box 4.3. Leave provisions for guidance
Denmark
When completing an Individual Competence Assessment (IKV), low skilled and middle-skilled participants aged 18‑65 are entitled to a fixed allowance funded by the state, as part of the State Grant System for Adult Training (VEU-godtgørelse). VEU also funds training leave. Learners may use training leave to consult guidance services relating to their education and training. Only the funding arrangements are regulated by law; the social partners may regulate all other issues concerning training leave through collective agreements.
Netherlands
No specific provisions regarding the right to training leave are present in national legislation in the Netherlands. Instead, training has been understood primarily as a responsibility of the social partners. Many large companies have social agreements (CAO) with career guidance facilities that allow workers to have time off work to consult career guidance advisors. However, significant differences in the regulation of training leave exist between sectors.
Source: OECD 2020 Policy Questionnaire, ‘Career Guidance for Adults’.
References
[7] Carpentieri, J. et al. (2018), Guidance and Orientation for Adult Learners: Final cross-country evaluation report, UCL Institute of Education, https://adultguidance.eu/images/Reports/GOAL_final_cross-country_evaluation_report.pdf.
[3] Cedefop (2020), Inventory of lifelong guidance systems and practices - Finland, https://www.cedefop.europa.eu/en/publications-and-resources/country-reports/inventory-lifelong-guidance-systems-and-practices-finland (accessed on 13 August 2020).
[1] Cedefop (2009), Professionalising career guidance: Practitioner competences and qualification routes in Europe, European Centre for the Development of Vocational Training, Luxembourg, https://www.cedefop.europa.eu/files/5193_en.pdf (accessed on 7 July 2020).
[8] Cedefop (2008), Career development at work: A review of career guidance to support people in employment, European Centre for the Development of Vocational Training (Cedefop), Luxembourg, https://www.cedefop.europa.eu/en/publications-and-resources/publications/5183 (accessed on 4 September 2020).
[2] European Commission (2020), Lifelong guidance policy and practice in the EU: trends, challenges and opportunities, European Commission, http://dx.doi.org/10.2767/91185.
[10] OECD (2021), Creating Responsive Adult Learning Opportunities in Japan, Getting Skills Right, OECD Publishing, Paris, https://dx.doi.org/10.1787/cfe1ccd2-en.
[11] OECD (2019), Getting Skills Right: Future-Ready Adult Learning Systems, Getting Skills Right, OECD Publishing, Paris, https://dx.doi.org/10.1787/9789264311756-en.
[5] OECD (2019), Individual Learning Accounts : Panacea or Pandora’s Box?, OECD Publishing, Paris, https://dx.doi.org/10.1787/203b21a8-en.
[4] OECD (2017), Financial Incentives for Steering Education and Training, Organisation for Economic Co-operation and Development, Paris, https://www.oecd.org/publications/financial-incentives-for-steering-education-and-training-acquisition-9789264272415-en.htm.
[9] OECD (2004), Career Guidance and Public Policy: Bridging the Gap, OECD Publishing, Paris, https://dx.doi.org/10.1787/9789264105669-en.
[6] Watts, A. (2008), “Career Guidance and Public Policy”, in International Handbook of Career Guidance.
Notes
← 1. “Mon compte formation: un bilan positif un an après le lancement, Les Echos (http://www.lesechos.fr/economie-france/), 18 November 2020.
← 2. The terms “career guidance” or “career advice” is rarely used by HR professionals or line managers to describe the process of career support used within organisations. They are much more likely to use the terms “career support” and “career development” to describe these processes (Cedefop, 2008[8]).
← 3. On average, adult learners take part in 30.5 hours of non-formal learning per year (Survey of Adult Skills, PIAAC). See Figure 2.4 in OECD (2019[11]).
← 4. Among those adults who wanted to participate in adult learning but did not, 28% reported a shortage of time due to work responsibilities, and 15% reported a shortage of time due to family responsibilities (Survey of Adult Skills, PIAAC). In total, 43% of non-participants reported lack of time as the reason they did not train.