International Day of Education came and went last week and evidently clear is the fact that education is in a state of crisis. As United Nations Director-General António Guterres remarked, “conventional education systems are struggling to deliver the knowledge, skills and values we need to create a greener, better and safer future for all.” Indeed, as we discussed in our previous brief, over 100 countries have closed schools at some point in an effort to contain COVID-19, and students risk losing $17trn in lifetime earnings in present value.

Under-18s are not the only victims of learning loss: the shutdown of economic activities as a result of the pandemic is estimated to have decreased workers’ participation in non-formal and informal learning by 18% and 25% respectively (as of 2021). Lower and medium-skilled workers who rely primarily on the latter for skill development experienced twice as much of an impact as their higher skilled counterparts. Formal learning was also impacted. Higher-education learning amongst American adults, for example, saw a decline, with 37% of higher-ed students over age 25 dropping out due to financial hardship.

Yet up-skilling and re-skilling will be essential to preparing the labor force for the future. On average, 32% of jobs are expected to require substantially different tasks and skills over the next 15-20 years due to automation (a pre-pandemic estimate from the OECD). Meanwhile, G20 countries unable to meet the skills of the new technological era could lose up to $11.5trn in GDP growth over the next 10 years.

Supporting adult learning in this context will require a concerted policy effort. One possible policy approach could involve, for example, tying job-retention schemes to workers’ participation in learning opportunities. This would be particularly useful for lower-skilled workers who are three times less likely than high-skilled workers (20% vs 58%) to pursue training, despite being most at risk for economic dislocation due to automation.

Corporations are aware of the importance of human capital development as well, with 66% of employers expecting to get a return on their upskilling and reskilling efforts within a year. These returns will depend on the local labor market conditions (e.g. unemployment rates) and the marginal productivity gains resulting from the skills acquired. Figures at the global level are hard to come by as a result, but analysis in the United Kingdom suggest an average productivity boost from reskilling between 6-12% and positive economic returns in about three-quarters of all reskilling cases. For the remaining 25%, government support will be critical. Currently only 21% of businesses report being able to access public funds for their reskilling.

Governments can also help to directly train workers in the skills of the future. Adult training in digital skills is a popular area of focus for many countries, including the U.K and Hungary who both have national digital skills programs.

As technology changes the landscape of work, so too will the model of education change. As of 2019, only 20% of adults who participated in job-related learning activities did so in an educational institution.

Meanwhile, demand for flexible digital offerings is booming. In their latest quarterly call, online course provider Coursera reported a 33% revenue growth on the back of the rising global demand for reskilling, with professional certificates “well-positioned to fulfill the rising demand for role-based learning among individuals and institutions,” according to the CEO.

Similarly, online education company 2U, which partners with many leading universities in the U.S., reported a 36% growth in its “alternative credentials” business segment in the second quarter of 2021. Demand is increasing for microcredentials awarded by companies and other non-institutional providers as well, with companies such as Google and IBM developing publicly available reskilling programs.

With the growing appeal of non-degree credentials – over 85% of educational institutions see them as important to their strategy for the future – understanding employer perception and the market value of these credentials will be key.

Education is not just a luxury for the privileged – it is a necessity for the most disadvantaged and vulnerable. As skills demands change, especially for the green transition, ensuring equitable and inclusive access to lifelong learning opportunities is an imperative to combatting inequality and promoting a prosperous economic future. While wide-scale investment in reskilling will be hefty (more than $34bn in the United States, for instance), it has the potential to boost global GDP by $6.5trn by 2030. As Benjamin Franklin said, “An investment in knowledge pays the best interest."

When Adults Are Students Too