1. Key insights and recommendations for Lithuania

Skills are vital for enabling individuals and countries to thrive in an increasingly complex, interconnected and rapidly changing world. Countries in which people develop strong skills, learn throughout their lives, and use their skills fully and effectively at work and in society are more productive and innovative, and enjoy higher levels of trust, better health outcomes and a higher quality of life.

As new technologies and megatrends increasingly shape our societies and economies, getting skills policies right becomes even more critical for ensuring societal well-being and promoting inclusive and sustainable growth. For Lithuania, implementing a strategic approach to skills policies is essential given the country’s persistent regional inequalities and relatively high exposure to digital and demographic disruptions. The COVID-19 crisis of 2020 has accelerated the digitalisation of learning and work, and risks increasing inequalities in education and labour markets. Lithuania currently has a unique opportunity to set policy directions for the next decade and beyond.

In Lithuania, as in other OECD countries, megatrends such as digitalisation, globalisation, demographic change and climate change are transforming jobs and the way society functions and people interact. To thrive in the world of tomorrow, people will need a stronger and more well-rounded set of skills. These include foundational; cognitive and meta-cognitive; social and emotional; and professional, technical and specialised knowledge and skills. Lithuania will also need to make better use of people’s skills in the labour market and in individual workplaces.

In particular, the digital transformation continues to have significant impacts on all aspects of life in Lithuania, including the development and use of skills. Information and communications technologies (ICT), advances in artificial intelligence (AI) and robotics are profoundly changing the way people learn, work, communicate and live across the OECD (OECD, 2019[1]). The Survey of Adult Skills, a product of the Programme for the International Assessment of Adult Competencies (PIAAC), shows that Lithuanian workers face among the highest risks of job automation in the OECD: about 20% of jobs in Lithuania face a high risk of being automated, while another 40% face significant changes in their tasks due to automation, a share higher than the OECD average (Nedelkoska and Quintini, 2018[2]) (Figure 1.1). Furthermore, the COVID-19 crisis has required a sudden transition to remote working in many occupations, forcing enterprises and workers to rapidly increase their digital competencies. Lithuania will need to encourage the development of skills and jobs that are more resilient to automation, and design interventions and investments to capture the benefits of digitalisation.

Contributing further to the uncertainties associated with technological change is the continuing expansion of international trade and global value chains. New technologies and trade liberalisation have led to a more globalised world that is characterised by the expansion of supply chains and the outsourcing of certain forms of work. Lithuania’s integration into international trade and global value chains continues to influence the structure and competitiveness of its economic sectors, which in turn has an ongoing impact on skills supply and demand in the labour market.

Emigration and population ageing are also profoundly affecting the Lithuanian economy and society. Migration flows turned positive in 2019 after being negative for 20 years. The shrinking share of the working-age population in Lithuania, as in many other OECD countries, is reducing the contribution of labour utilisation to economic growth. As a result, productivity growth will be an even more important driver of economic growth in the future, putting more pressure on the need to raise workers’ output.

Environmental challenges – climate change, air quality, water pollution, waste management and biodiversity loss – have implications for skills, and potentially how they are developed and used. As a result of the green transition, some new “green jobs” will be created, while some existing jobs could be eliminated or transformed in terms of their day-to-day tasks and methods (ILO, 2017[3]; Martinez-Fernandez, Hinojosa and Miranda, 2010[4]). The long-term challenge for policy makers will be to help their economies move towards sustainable highly skilled, high-productivity activities.

Against this backdrop, people will increasingly need to upgrade their skills to perform new tasks in their existing jobs or acquire skills for new jobs. Strong foundational, digital and social and emotional skills, such as critical thinking, communication and adaptability, will become essential for people to be resilient to changing skills demands and to succeed in both work and life.

Lithuania was hit hard by the 2008 global financial crisis, and a deep recession followed. By 2019, Lithuania had regained the path to prosperity, with gross domestic product (GDP) growth among the highest in the OECD, and the employment rate above the European Union (EU) and OECD averages. However, the COVID-19 crisis halted the recovery, with the economy contracting by -0.8% and unemployment rising to 8.5% for the full year 2020, despite the government providing support to households and firms equivalent to almost 10% of GDP. The OECD forecasts the economy to rebound and unemployment to decline in 2021 (OECD, 2020[5]), although protracted disruptions in world trade could worsen this outlook.

Other persistent challenges remain that risk being exacerbated by the COVID-19 pandemic. Poverty rates are high, especially among the unemployed, less educated, single parents and older people (OECD, 2020[6]). Regional disparities in productivity and well-being are increasing, reflecting low investment in peripheral regions and low labour mobility towards economically strong areas. Additionally, labour productivity is only about two-thirds of the OECD average, reflecting a high incidence of labour informality and skills mismatch, among other things (OECD, 2020[6]). As international evidence shows that the crisis has disproportionately impacted the low skilled and low paid, Lithuania will need to enact targeted skills and other policies to prevent inequalities from increasing further.

Lithuania continues to face skills imbalances that undermine productivity growth. According to the OECD Skills for Jobs Database (OECD, 2018[7]), Lithuania faces a shortage of workers with knowledge of computers and electronics, skills in systems evaluation and analysis, and verbal and quantitative abilities. These shortages have particularly affected certain occupations (including science and engineering professionals, and chief executives, senior officials and legislators) and sectors (including ICT). Recent forecasts suggest that Lithuania could face hiring difficulties in a range of medium-skill occupations, including service and sales workers, as well as plant and machine operators and assemblers, and craft and related trades workers (Cedefop, 2020[8]). In 2019, about 41% of employed higher education (HE) and vocational education and training (VET) graduates in Lithuania (aged <35, not in formal education) were mismatched with their job by field of study and/or qualification level. Lowering skills mismatches in Lithuania to the levels of the best performing countries could equate to productivity gains of about 10% (Adalet McGowan and Andrews, 2017[9]). The COVID-19 pandemic has reduced hiring and shortage pressures in the short run, which could force more graduates to accept lower-skilled or poorly aligned jobs. The pandemic could also accelerate structural change across sectors, for example through shifts in consumer habits, which could exacerbate skills mismatches if education systems do not respond quickly enough.

The above megatrends and challenges reinforce the need for Lithuania to design forward-looking, dynamic skills policies. To thrive in the world of tomorrow, people will need a stronger and more comprehensive set of skills. Strong foundational skills will make people more adaptable and resilient to changing skills demands, and digital, transversal, social and emotional, and job-specific skills (Box 1.1) will become increasingly essential for individuals to succeed in learning, work and life. High-quality learning across the life course should be accessible for everyone to enable full participation in society and to successfully manage transitions in the labour market. Adults will need greater opportunities to upskill and reskill, while learning providers will need to create more flexible and blended forms of learning. Firms will have to adopt more creative and productive ways of using their employees’ skills. Finally, robust governance structures will be needed to ensure that reforms are sustainable.

The importance of skills for Lithuania is also reflected in the European Skills Agenda, which seeks to strengthen sustainable competitiveness as set out in the European Green Deal, implement the first principle of the European Pillar of Social Rights (access to education, training and lifelong learning for everybody in the EU), and build resilience to react to crises (learning from the COVID-19 pandemic). In line with these goals, the European Commission (EC) has recommended that Lithuania improve quality and efficiency at all education and training levels, including adult learning. However, Lithuania has made limited progress on this recommendation since 2019 (European Commission, 2020[10]). In the context of Lithuania’s ongoing medium- and long-term planning initiatives (discussed below), the country has a unique window of opportunity to put skills at the top of the agenda to positively influence megatrends, tackle the challenges and seize the opportunities facing the country. This Skills Strategy project seeks to support Lithuania to seize this opportunity.

OECD Skills Strategy projects provide a strategic and comprehensive approach to assess countries’ skills challenges and opportunities and build more effective skills systems. The OECD collaborates with countries to develop policy responses tailored to each country’s specific skills challenges and needs. The foundation of this approach is the OECD Skills Strategy Framework (Figure 1.2), the components of which are:

  • Developing relevant skills over the life course: To ensure that countries are able to adapt and thrive in a rapidly changing world, all people need access to opportunities to develop and maintain strong proficiency in a broad set of skills. This process is lifelong, starting in childhood and youth and continuing throughout adulthood. It is also “life wide”, occurring both formally in schools and higher education, and non-formally and informally in the home, community and workplaces.

  • Using skills effectively in work and society: Developing a strong and broad set of skills is just the first step. To ensure that countries and people gain the full economic and social value from investments in developing skills, people also need opportunities, encouragement and incentives to use their skills fully and effectively at work and in society.

  • Strengthening the governance of skills systems: Success in developing and using relevant skills requires strong governance arrangements to promote co-ordination, co-operation and collaboration across the whole of government; engage stakeholders throughout the policy cycle; build integrated information systems; and align and co-ordinate financing arrangements. The OECD Skills Strategy project for Lithuania adopted this approach by forming an interdepartmental project team to support the whole-of-government approach to skills policies, and by engaging a broad variety of stakeholders.

The OECD Skills Strategy project for Lithuania officially started at the onset of the COVID-19 pandemic, and so missions to Lithuania were replaced with virtual forms of engagement. The OECD held a virtual skills seminar in March 2020 to begin the project, assessment consultations in May and June to diagnose challenges, and recommendation consultations in September to develop recommendations. The virtual assessment and recommendations consultations involved bilateral meetings, expert group discussions, interactive stakeholder workshops, and webinars with government officials and stakeholders. The consultations sought not only to enrich the report with local insights, but also to develop a constructive dialogue and cultivate a shared understanding of skills challenges and opportunities as a basis for action. The OECD Skills Strategy project in Lithuania has engaged around 150 participants who represent ministries and agencies, municipalities, education providers, employers, workers, researchers, and other sectors.

The report was prepared after the initial outbreak of the COVID-19 pandemic and makes recommendations that could facilitate Lithuania’s recovery, as well as recommendations to build the performance and resilience of Lithuania’s skills system in the longer term.

The OECD Skills Strategy Dashboard provides an overview of the relative performance of countries across the dimensions of the OECD Skills Strategy (Figure 1.3). For each dimension of the strategy, there are a number of indicators, some of which are composite indicators, which provide a snapshot of each country’s performance (see Annex 1.B for the indicators).

Lithuania could improve its performance in several areas of developing people’s skills (Figure 1.4).

Participation in education is compulsory from pre-primary to lower secondary education (from the ages of 6 to 16). Participation in early childhood education continues to increase, but is below the rates in Latvia and Estonia, and remains particularly low among children from socio-economically disadvantaged backgrounds. In compulsory education, Lithuania has among the lowest drop-out rates in the OECD, which has positive implications for equity. However, relatively few secondary students choose VET, and those that do are far more likely to be from disadvantaged backgrounds than those in general education. Lithuania has among the highest share of young adults (aged 25-34) with a tertiary education (55.2% in 2019) in the OECD, and this rate continues to grow. However, individuals from disadvantaged backgrounds remain under-represented in tertiary education. In 2020, only 17% of upper secondary graduates from low-income families entered tertiary education, compared to 68% from high-income families (Strata, 2020[11]).

Young people in Lithuania have comparatively low levels of skills. Results from the OECD Programme for International Students Assessment (PISA) 2018 show that the performance of 15-year-old students in reading, mathematics and science remains below the OECD average, and has not improved over time (OECD, 2019[12]). Students from disadvantaged economic, social and cultural backgrounds perform worse than other students (to an extent that is consistent with the OECD average), and the performance gap has not narrowed over the last decade. Young tertiary graduates in Lithuania have lower levels of literacy skills, but higher levels of numeracy skills than the average for tertiary graduates in OECD countries.

Adults in Lithuania have lower levels of foundational skills (literacy, numeracy, problem solving) on average than adults in other OECD countries. Furthermore, compared to other OECD countries, relatively few adults in Lithuania (16%) have a well-rounded set of foundational skills (at least medium levels of proficiency in literacy, numeracy and problem solving). Foundational skills levels are relatively similar between adults who were raised in highly-educated households and those who were not. However, relatively few adults participate in education and training. Adults’ motivation for adult learning is fairly low, and many who wish to participate face barriers to doing so.

Lithuania could also utilise people’s skills more effectively in workplaces and society (Figure 1.5).

Lithuania does a relatively good job at activating people’s skills in the labour market. A relatively high share of adults participate and are employed in the labour market, and the rate of young people not in employment, education or training (NEET) is below the OECD average. However, Lithuania’s performance in achieving an inclusive labour market is mixed. Although there is virtually no gender gap in the employment rate, unlike in other OECD countries, Lithuania has one of the largest employment gaps between high- and low-educated adults in the OECD, highlighting the value placed on tertiary education in the labour market.

According to the dashboard, Lithuania’s labour market is experiencing a higher incidence of mismatches, shortages and surpluses than many other OECD countries. Other data from Lithuania, the OECD and Cedefop confirm this assessment (OECD, 2018[7]) (Cedefop, 2020[8]), as is discussed in Chapter 2 and elsewhere. For example, Lithuania has one of the largest shares of over-skilled workers (in literacy and numeracy) across the countries/economies participating in the Survey of Adult Skills (PIAAC).

Adults in Lithuania report that they use their skills (reading, numeracy and ICT) less frequently at work and in life than adults in most other OECD countries. This represents a missed opportunity to realise the benefits of investing in developing people’s skills. Furthermore, in Lithuania the share of jobs in which high-performance work practices (HPWP) such as work flexibility and autonomy, teamwork, training and development, and career progression and performance management are used (15%) is about half of the OECD average. Low levels of skills use and HPWP may constrain innovation in Lithuania, and be constrained by a lack of innovation.

While not measured in the Skills Dashboard, sound public governance of the skills system is contingent upon a government’s ability to co-ordinate, steer, monitor, communicate and work horizontally (across departments and institutions within government) and vertically (with local authorities and external public and private stakeholders). Many of today’s skills challenges across OECD countries are rooted in poor governance arrangements across policy areas and levels of government, ineffective engagement with stakeholders, inadequate information on skills and learning outcomes, and inefficient financing mechanisms.

In Lithuania, horizontal co-ordination between ministries on skills policies continues to be challenging and appears to be limited beyond the planning phase, including in the implementation, monitoring and evaluation of policy. The capacities of municipalities and regional development councils for self-management and to manage their education providers are often underdeveloped. Lithuania’s performance in engaging stakeholders in skills policies is somewhat stronger, yet stakeholder associations sometimes lack the capacity to effectively engage. Lithuania has made substantial progress in the area of evidence-based policy making and skills assessment and anticipation tools, but demand and capacity for evidence-based policy inside ministries is not strong. Lithuania’s per-student expenditure on education is low by international and regional comparison, and funding sources are not highly diversified.

Lithuania has already developed a range of strategies and reforms (see Annex 1.C for a complete overview) to help the country positively influence megatrends, address the challenges and seize the opportunities facing its skills system. Relevant priorities and goals from these strategies are summarised at the beginning of each chapter to highlight their connection with the OECD’s assessment and recommendations.

The state progress strategy “Lithuania 2030” (Lietuva 2030) is a national strategy document that outlines the vision of Lithuania's future to 2030. It envisions a learning society in which people are educated, interested in science and innovations, easy and familiar with the latest technologies, good at foreign languages, and eager to pursue lifelong learning. The National Plan for Progress (NPP) 2021-2030 outlines 10 strategic goals for Lithuania over the upcoming decade to ensure progress in social, economic, environmental and security policies. Strategic Aim 3 of the NPP is particularly skills focused and aims to increase the inclusion and effectiveness of education to meet the needs of the individual and society. The Programme of Government 2020 outlines the government’s missions for the next four years, and includes priorities such as “good school for all and modern education curriculum”, “market-responsive vocational education and training”, “lifelong learning for all in Lithuania”, “universal entrepreneurship” and “modern and efficient (public) institutions” (The Seimas of the Republic of Lithuania, 2020[13]). Finally, the Law on Strategic Governance seeks to create a results-oriented strategic governance system that integrates strategic planning, regional development and spatial planning processes to ensure long-term and sustainable public progress and efficient government finances. It creates the opportunity for skills policy to be co-ordinated to an extent that has not yet been achieved in the country.

Furthermore, as detailed in subsequent chapters, Lithuania has embarked on a range of skills policy reforms in recent years. These include funding models in formal education, the consolidation of schools and vocational and higher education institutions, initial and continuing teacher education, the governance of VET institutions, and labour code amendments. Monitoring and increasing the positive impacts of these reforms is critical for Lithuania as it enters a new period of strategic planning.

Lithuania is now in the midst of a new round of strategy development for the medium and long term. This gives Lithuania a unique window of opportunity to implement a more strategic approach to skills to help drive economic prosperity, social cohesion and sustainable growth. In summary:

  • Following the development of the National Plan for Progress (NPP) 2021-2030, Lithuania’s ministries are finalising their own National Development Programmes to outline how they intend to achieve Lithuania’s strategic goals in the NPP. The National Development Programmes will be approved by the Government and monitored by the Ministry of Finance.

  • Lithuania is finalising its 2021-2027 EU Funds Investment Programme, which breaks down the overarching strategic objectives agreed in its partnership agreement into investment priorities, specific objectives and further into concrete actions. Consistent with the European Skills Agenda, skills are relevant across the policy objectives in the programme, especially the objectives for a smarter and more socially responsible Europe.

  • Lithuania will submit a recovery and resilience plan to the European Commission by 30 April 2021 that outlines substantive reform and investment efforts to mitigate the economic and social impact of the coronavirus pandemic, with financing from the EUR 672.5 billion Recovery and Resilience Facility (RRF). Skills policies should be a core part of this plan, as skills cut across the four general objectives and European Flagship initiatives targeted by the RRF (including number 7 to “reskill and upskill”).

  • Lithuania’s new Law on Strategic Governance (Lietuvos Respublikos Strateginio Valdymo Įstatymas) foresees “national agendas”, which are planning documents used by government to set the long-term agenda in specific policy areas, with ultimate reporting to the parliament.

  • Lithuania’s long-term strategy for progress, Lithuania 2050, is being developed by 2022 and will set Lithuania’s vision for development and strategic directions. These could cover cross-cutting topics including skills.

The assessment and recommendations in this report can feed into these processes to help ensure that Lithuania’s skills priorities, policies and investments over the next decade improve outcomes across the skills system.

Based on the OECD’s initial assessment of the performance of Lithuania’s skills system and discussions with the Lithuanian national project team, four priority areas and two horizontal themes were identified for this Skills Strategy project. Over the course of the project, the OECD identified opportunities for improvement and developed recommendations in each of the priority areas based on in-depth desk analysis and virtual consultations with the Lithuanian Government and stakeholder representatives. The figure below depicts these priority areas, horizontal themes and opportunities for improvement (Figure 1.6).

The summaries below highlight the key findings and recommendations for each priority area, while subsequent chapters provide full details in these areas.

Young people’s skills are critical for their personal well-being and outcomes later in life, as well for countries’ economic prosperity and social cohesion. Across the OECD, individuals with higher literacy proficiency are more likely to be employed, earn high wages, trust others, participate in the democratic process and community life, and report good health than their less-skilled peers. For countries, skills are a key driver of innovation, productivity and, ultimately, economic growth, social cohesion and higher living standards (OECD, 2016[14]). Developing skills at an early age is, therefore, a key investment in the economic prosperity and well-being of countries. Countries whose youth develop strong skills typically have highly skilled adult populations, as skills outcomes in youth are strongly correlated with success in tertiary education (OECD, 2019[15]). Young people can develop skills in various learning contexts (schools, communities and even workplaces) and at different levels (early childhood education and care, primary, secondary and tertiary education). This learning may be formal (leading to a recognised qualification) or non-formal in nature. Young people increasingly need high levels of cognitive skills (e.g. literacy, problem solving), social and emotional skills (e.g. perseverance, teamwork), and technical skills to thrive in the modern world as adults. The COVID-19 pandemic has been a major test of the ability of institutions, teachers and families to equip young people with skills through remote learning, without leaving any students behind.

Lithuania continues to expand young people’s enrolment in different levels and forms of education and training. However, participation remains relatively low in certain types of learning and for certain groups of learners. Beyond participating in and completing education programmes, it is essential that young people of all backgrounds develop a range of skills to a high level and build high expectations for their future. However, students in Lithuania are not developing high levels of skills. Successfully equipping young people with skills for work and life should positively affect their employment outcomes and reduce skills mismatches. While there is strong and growing demand for high levels of skills in Lithuania, the success of the education system in meeting these needs is mixed, with many graduates mismatched to their jobs.

Raising students’ performance in the school years and equipping them with the skills needed for success in work and life requires, among other things, a modern and effective school curricula. Lithuania is currently updating the general curriculum framework for primary, basic and secondary education (ISCED 1-3) to implement a competency based curricula that addresses various identified weaknesses. Some participants in this project raised concerns about how well general competences will be integrated across subjects, whether there is sufficient interdisciplinary content and coherence between levels of education, and whether curriculum overload is addressed. Successful implementation of the curricula will require stronger government engagement with general and vocational educational stakeholders, a clear plan for improving equity through the curricula, and modernised competency based student assessment. Ensuring more young people have access to high-quality non-formal education programmes will also be essential to complement the new curricula. Non-formal education activities are not equally available in all regions of Lithuania, quality is not monitored, and activities are not well-integrated with or recognised in formal education.

Equipping young people with higher levels of skills depends on capable and empowered teachers and school leaders. Investing in the competencies of teachers will be essential for realising the goals of curricula reforms. Lithuania could improve pathways into the teaching profession, as well as salary and non-salary conditions, to attract and retain more skilled candidates and empower excellence in teaching and leadership. Limited opportunities for full-time workloads and salary increases may deter people from entering the teaching profession and school leader positions. Lithuania could better empower teachers and school leaders by linking promotions more closely to responsibilities and appraisals, and further improving induction activities, professional collaboration and impactful feedback. Teachers and school leaders also need the right competencies to successfully equip young people with skills for work and life. Lithuania could raise the quality of initial teacher education (ITE) by increasing practical learning, school leader training, and research and development capacity. Lithuania could improve continuous professional development (CPD) by increasing and better targeting public support at teachers’ and leaders’ identified training needs, more innovative forms of professional development, and formal training to teach additional subject areas.

Lithuania could also increase the responsiveness of vocational and higher education to current and anticipated labour market needs to better equip young people with skills for work and life. A responsive education system that allows students to develop a set of skills aligned with current and anticipated labour market needs is beneficial for students, employers and the economy as a whole. Lithuania could modify funding arrangements and admissions policies to increase incentives for institutions and students to respond to labour market needs. The determination of publicly funded places and subsidies by field of study in VET and HE could be more closely linked to labour market needs. Furthermore, public funding for institutions is not linked to VET and HE graduate outcomes, which dampens institutions’ incentives to be responsive. Improving the labour market relevance of education requires effective interaction between the education system and employers. Participants stated that Lithuania lacks a culture of co-operation between educational institutions and employers. Employer involvement in institutional governance and course design is relatively well established, especially in VET, but employers need greater financial and non-financial support to offer work-based learning to students. Policy makers also lack reliable information on the quantity and quality of students’ work-based learning experiences.

Across the OECD, adults with lower literacy and numeracy levels are far more likely than those with higher levels of skills to have lower earnings and employment rates, report poor health, feel excluded from political processes and have less trust in others. Adults of all skill levels have a growing need to upgrade and reskill regularly in the context of technological change, more frequent transitions between jobs, the growth of non-standard forms of work (and by extension less access to employer sponsored training), and the lengthening of working lives. Adult learning (in all forms and contexts) is essential for boosting the skills of adults and can generate a range of personal, economic and social benefits. In the context of COVID-19, those unemployed will need extensive support to upskill and retrain in order to quickly adapt to changing economic conditions and a more challenging labour market.

Increased participation in adult learning is strongly linked to an individual’s positive learning dispositions and perceptions that learning brings tangible benefits. A lack of awareness about adult learning benefits and opportunities can lead to low levels of motivation to participate in adult learning, and indicates that Lithuania will need to more actively reach out and promote the benefits of adult learning to individuals. A number of policy levers can support these efforts, including the dissemination of information through awareness-raising campaigns and online portals. Raising awareness about the benefits of adult education and training among enterprises is equally as important. Employers play a major role in facilitating non-formal education and training for employees, in addition to their role in providing informal learning on the job. Helping employers assess their training needs and put in place training plans can lead to increased participation in adult education and training.

Even when individuals and employers are motivated to engage in adult learning, they frequently face barriers. A disproportionate number of enterprises in Lithuania list the high cost of continuous vocational training as a reason for not providing education and training opportunities for employees. This indicates a need to improve the availability of financial incentives for enterprises to facilitate training opportunities. The high cost of participation in adult education and training is also a barrier for individuals, which means that improving financial incentives for individuals will be necessary to reduce the number of adults who want to but cannot afford to participate in training. However, financial incentives alone are likely to be insufficient to reduce barriers to participation in adult learning. In Lithuania, time-related barriers such as the inability to fit training around personal and work commitments are another important obstacle to participating in adult learning. As a result, improving the flexibility of adult learning provision is crucial to improving access to adult learning opportunities.

In Lithuania, as in other OECD countries, the majority of structured adult learning takes place within non-formal education and training. Non-formal learning forms a core part of the adult learning system because it is more flexible in duration and delivery than most formal learning. Non-formal courses are typically shorter than formal courses, enabling adults to take individual modules rather than full courses. They can take place via on-the-job training, open and distance education, courses and private lessons, seminars and workshops, as well as in vocational and higher education institutions. The diversity of non-formal offerings can present a challenge to ensure that learning outcomes are recognised and that training is of high quality. Learning is most rewarding for individuals when their achievements are visible and understood by employers. This matters for skills acquired in both non-formal and informal learning environments. Lithuania has taken important steps towards creating a national system of skills recognition over the past few years, but the quality of processes to recognise and validate non-formal and informal learning is still unequal between providers. Ensuring the high quality of non-formal adult education courses can also be challenging. Whilst Lithuania has robust quality assurance mechanisms for formal learning in both higher and vocational education, these are lacking in publicly funded non-formal adult education. Lithuania should consider strengthening ex ante and ex post quality assurance mechanisms to improve the quality of publicly funded non-formal education.

In addition to making progress in developing strong skills among youth and adults, Lithuania should strive to use these skills as intensively as possible to realise the full potential of initial investments in skills. There has been growing awareness among policy makers across the OECD of the importance of effectively using skills in workplaces. Skills use is associated with the better performance of workers (e.g. higher job satisfaction and productivity), which helps to strengthen business performance and can help drive economic growth. The organisation of workplaces is arguably the most important determinant of skills use, especially through the adoption of a range of HPWP.

For Lithuania, effectively using skills could help to address challenges linked to megatrends (e.g. by supporting the transition to more high value-added jobs), and could contribute to the economic recovery from the COVID-19 crisis.

Lithuania has launched many strategies and programmes aiming to enhance business performance and move towards more high value-added activities. However, among these policies there is currently no focus on skills use and HPWP. A stronger focus on business support targeted at the level of workplaces could further strengthen and complement Lithuania’s current policies aimed at transforming the business sector. Lithuania lacks support measures for businesses to adopt HPWP, such as awareness raising of the relevance of skills use and related HPWP, accessible and targeted business support for HPWP, and sectoral solutions that leverage employer networks and support sectoral collaboration to increase HPWP adoption.

Strong and effective management and leadership has many benefits for businesses, including higher levels of employee engagement, more innovation and higher productivity. As a result, strong management and leadership skills can support the transformation of workplaces to help them more effectively use skills, strengthen business performance and transition towards more high value-added activities. There are, however, indications that management skills are not strong in Lithuania (e.g. 22% of managers have low skill levels, compared with 15% across the OECD). This is also reflected in the overall quality of management, for example data from the World Economic Forum Global Competitiveness Report suggest that many businesses do not rely on professional management (i.e. those selected on merit and qualifications). Currently, Lithuania lacks awareness of the importance of overcoming management and leadership skills challenges, and a strategic vision might be needed. The initial development of management and leadership skills in formal education is not strong, and available learning programmes are not sufficiently promoted to strengthen management and leadership skills.

In addition to strong and effective management and leadership, the skills and attitudes of the workforce are critical for transforming workplaces to use skills more effectively. Without the buy-in and support of employees, the adoption of HPWP is more difficult to achieve. An empowered workforce is typically more motivated to develop and optimally use skills. In the context of a changing business environment (e.g. through COVID-19 and the digital transformation), empowering and engaging employees becomes even more important. In Lithuania, HPWP related to employee engagement, work autonomy and performance management are uncommon, and thus not empowering workers towards higher skills use. Only 10% of employers say that their employees are very motivated, compared with 17% across the EU and as high as 43% in top-performing countries such as Denmark and the Netherlands. Lithuania’s opportunities to improve the empowerment and engagement of employees are not limited to private enterprises, with evidence of relatively low skills use and HPWP in the country’s public sector.

Well-functioning governance arrangements are central for effective skills policies. However, governance structures for skills policies are complex as they involve a wide variety of actors in the provision, financing, reform and day-to-day administration of skills policy. These actors range from different levels of government to stakeholders such as employers and their associations, employees and trade unions, education and training providers, and students. In addition, skills policies lie at the intersection of more “traditional” policy fields and so implicate ministries responsible for education, labour market, innovation, industrial and other policy domains. Furthermore, skills policies are designed in the context of uncertainty and change, such as rapid technological change, globalisation, and demographic and climate change, as well as the potential structural economic changes resulting from COVID-19. The latter could include relocations of economic sectors considered as critical infrastructure or changed consumer behaviour leading to structural economic change (e.g. boosting online trade and business practices, increased domestic business and tourism), which could have consequences for skill needs. In light of these complexities, the success of Lithuania’s skills policies will require a whole-of-government approach, effective stakeholder engagement, integrated information systems and co-ordinated financing arrangements to improve skills development and use.

In well-functioning skills systems, all actors should have sufficient opportunity to co-ordinate, as responsibilities for skills policies are dispersed. Skills policies should be guided by common goals and a shared vision across all relevant stakeholders and decision makers. However, this appears to be lacking in Lithuania. Individual ministries or semi-autonomous bodies should not pursue their own skills policies without co-ordination with other relevant ministries and governmental bodies, necessitating co-ordination across the “whole-of-government”. Since its independence, Lithuania has invested substantial resources into building up a system of social partnership and consequently stakeholder engagement. This infrastructure should be leveraged in the future, as stakeholder engagement is more successful if it goes beyond ad hoc consultations towards the long-term institutionalisation of consultations. Furthermore, well-functioning stakeholder engagement depends on stakeholders perceiving their involvement as meaningful and consequential. Participants in this project stated that some stakeholders in Lithuania lack such positive perceptions. Subnational actors sometimes lack sufficient personnel, financial resources and expertise to fulfil their responsibilities in policy making, which shows their need for greater guidance and support from central government.

Comprehensive information systems on current skills policy outcomes and future skills needs, as well as on the career opportunities connected to current and future skills needs, are an essential building block of well-governed skills systems. Lithuania could improve both the availability of information for evidence-based policy making and the use of this information by policy makers. For example, Lithuania could use qualitative “foresight” to take into account the fundamental uncertainties of future skill demands that are not fully identifiable via quantitative analysis. To improve the use of existing information by policy makers, Lithuania should take a more co-ordinated approach to understanding ministries’ individual data needs and ensure that relevant stakeholders have sufficient capacity (personnel and expertise) to effectively use information in policy making. Individuals of different age groups lack the information and capacity to make wise learning and career decisions. A major shortcoming to this is that career guidance is only available to some parts of the Lithuanian population, mostly youth and jobseekers in the economically stronger regions of the country. Lithuania should consequently build a comprehensive information system to inform and guide the career choices of individuals across all regions and age groups.

Lithuania’s spending on skills policy remains relatively low by international comparison. Beyond increasing public expenditure, Lithuania could resort to more innovative mechanisms for raising the financial resources necessary for sustainable skills policy. For example, cost-sharing mechanisms between central government, employers and potentially employees can help to raise the resources necessary for sustainable skills provision. The money allocated to skills policy should also be well targeted. Lithuania currently has a dense network of schools and higher education institutions relative to its population size, creating opportunities for cost savings. Contributions of international organisations to skills policies, in particular from the European Union, are high in Lithuania. There is evidence that this funding is not consistently well targeted, as funding is rarely continued beyond the initial life of the project. Mechanisms need to be put into place to allow high-performing EU-funded programmes to continue on a permanent basis.


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This annex presents the OECD’s full policy recommendations for Lithuania arising from this project. These recommendations and the analysis, evidence and international examples that support them can be found in Chapters 2-5.

This annex presents the OECD Skills Strategy Dashboard. The objective of the Dashboard is to present an overview of the performance of skills systems in OECD countries. It is the starting point for analysis in the diagnostic phase of Skills Strategy projects and allows the OECD and the Project Team to identify the priority skills policy themes to be covered in greater detail in the report. Presenting the relative position of countries on key skills outcomes, the Dashboard provides a general overview of the strengths and weaknesses of a given country or region’s skills system. This annex describes the characteristics, presents the indicators and describes the underlying methods for calculating indicators.

The OECD Skills Strategy Dashboard is the result of internal consultation and analysis of core indicators used in OECD Skills Strategy projects. It presents a simple, intuitive overview of the outcomes of skills systems that is easy to interpret, and gives a quick overview of a country’s skills performance across the dimensions of the OECD Skills Strategy (“developing relevant skills” and “putting skills to effective use”). The Dashboard applies a broad definition of skills by presenting foundational skills, problem-solving skills and breadth of skillsets, and considers both economic and social outcomes. A total of 33 key outcome indicators were selected and grouped into 16 aggregated indicators.

The selection of indicators followed a process whereby a longlist of the most commonly used indicators in OECD Skills Strategy reports was gradually reduced to a shortlist of core indicators. This process built on the principle that the indicators describe the core outcomes of the different dimensions of the skills system. In addition, these indicators express outcomes in terms of level, trend, distribution and equity. The indicators need to be comparatively easy to interpret and based on OECD sources, using the most recently available.

To develop aggregate indicators that represent the relative position of countries on key outcomes of the skills system, a number of calculations were made on the collected data. To describe the relative position across countries, a score for each indicator was calculated ranging from 0 to 10, with 0 for the weakest performance and 10 for the strongest performance. This resulted in an indicator that allows comparisons between different types of indicator (e.g. averaging performance of literacy scores and educational attainment rates). The resulting scores were normalised in such a way that better performance results in a higher score. Subsequently, an unweighted average of the indicators was calculated for each of the aggregates, and these scores were then ranked. The final ranking was separated into five groups of equal size, ranging from top 20% to bottom 20% performer. Aggregate indicators are only presented in the Dashboard when more than half of the underlying indicators have data available.

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