Thailand: Challenges and Options for 2011 and Beyond 67485 Education Towards a Growth-Sustaining Education Sector Continued economic growth in Thailand will be determined by increased productivity which in turn will depend on how Thailand manages to improve the skills of the workforce. Lack of skills constitutes a major constraint for productivity growth. A strong education sector is crucial for the production of those skills. Successes made in expanding access to education in Thailand will be overshadowed if too few students acquire the cognitive skills needed for the modern labor market. In building a 21st century education system it will be key to reduce the disparity in education quality and outcome across the country and bring learning outcomes of the whole country up on par with those of high performing Bangkok. This can be achieved through measures for (i) increased social accountability in the education system through the annual publication of performance reports and school resources; (ii) improved teacher supply and quality through selection, professional development, and the linking of remuneration with performance, and; (iii) institutional reforms through the integration of functions across agencies within the education sector as regards to budgeting, monitoring and evaluation, administration and finance. Education and Growth in Thailand 2011 Doing Business data ranked Thailand 19th out of 183 countries for ease of doing business. The 2007 Thailand’s growth over the past 25 years has been Productivity and Investment Climate Survey (PICS) driven primarily by an expansion of employment in indicated that Thailand is well placed in terms of the industrial sector and capital investment. infrastructure, regulation and other objective Productivity gains have been relatively small, with investment climate measures. However, its total factor productivity accounting for only one-sixth traditional labor cost advantage is being eroded by of the annual growth rate between 1985 and 2005. faster growing countries and skill shortages have Less than one-tenth of the growth can be attributed become Thailand’s biggest obstacle to doing to human resource improvements. With the business. In 2007, firms perceived skills and emerging decline in labor cost advantages and the education of available workforce as the 4th most gradual appreciation of the Thai Baht, high growth in serious obstacle to doing business in Thailand. About the future will depend on workforce productivity. 40 percent of firms reported skilled labor shortage as one of their top three constraints to doing business. Enterprise managers perceive shortages of skilled This is significantly more than in comparator labor as Thailand’s top constraint to growth. The countries, including China, India, Indonesia, Korea, THAILAND: CHALLENGES AND OPTIONS FOR 2011 AND BEYOND September 2011 Malaysia, and the Philippines. Nearly all firms generally weak and uneven quality of early child surveyed in Thailand ranked lack of skills in English development and basic education across Thailand and IT as the most serious gap, followed by contribute to the structural imbalances in upper weaknesses in numerical and technical skills, and secondary and post-secondary education, including generic skills such as creative thinking and problem low enrolment in science and technology and solving, leadership, and communication. inequity in tertiary enrolments. Moreover, while labor mobility and job matching could be The Thai government recognizes the importance of strengthened by providing quality assurance through nation-wide improvements in education for the a stronger accreditation system and country's future development, and has since 1999 entrepreneurship and innovation could be engaged in efforts to improve the country's strengthened through better linkages between education system through successive National industry and training centers, the success of these Education Reform plans, which are now in their reforms really hinge on the ability of the education second decade. The aim of reform initiatives has sector to produce job relevant skills and the been to modernize the system so that it produces as prerequisite cognitive skills. workforce with better labor market and income Figure 1. Steps towards Employment and Productivity prospects. The government’s reform plan has been Figure 1: Steps towards Employment and Productivity centered around four pillars: increasing the focus on quality of education; improving teacher's capabilities; modernizing schools and learning centers; and improving educational management. Short-term measures include increasing the focus on technical and vocational education, as well as English and science, technology and mathematics. Better results in math, science and IT in basic education would facilitate stronger technical higher education, research and innovation as well as improve the ability The Skills towards Employment and Productivity (StEP) framework helps of Thailand’s future workforce to adopt and facilitate policy makers identify bottlenecks in the production of needed skills from pre-natal to life-long learning technological change throughout the domestic economy. In addition, as part of Thailand’s broader Struggling with Quality development agenda, the government has increased interventions to address iodine deficiency. While Thailand’s education sector has been very successful at getting children enrolled up to high A Framework for Improving Skills school, many of them have not obtained the skills Development at Every Step and knowledge needed to meet real-life challenges. Figure 2. Number 15 year-olds obtaining the knowledge Figure 2: Number ofof15 year-olds obtaining the skills and skills and knowledge The World Bank describes the Steps towards needed to meet real-life challenges in PISA reading in Thailand needed to meet real-life challenges in PISA reading in Thailand Employment and Productivity in a framework of five Number of 15 year-olds stages (see Figure 1) starting from pregnancy and early childhood to labor market mobility and job Number of 15 year-olds enrolled in school matching. Number of 15 year-olds enrolled in school and able to locate information which may need to be inferred from a text A recent World Bank study found bottlenecks at each 0 200,000 400,000 600,000 800,000 1,000,000 Source: OECD PISA 2009 step of this process. In building the foundation for skills development, a uniquely serious problem in Thailand has participated in international measures Thailand is iodine deficiency, which erodes of learning performance. The OECD’s Programme for intellectual capacity of children and negatively affects International Student Assessment (PISA) revealed their learning and productivity later in life. By school that, while 80 percent of 15 year-olds in Thailand are age, ensuring that children attain a quality basic still in school, only 46 percent of them are able to education remains a challenge illustrated by locate information which may need to be inferred relatively weak student performance in tests. The from a text, signaling low levels of functional literacy. The World Bank in Thailand | Education 2 THAILAND: CHALLENGES AND OPTIONS FOR 2011 AND BEYOND September 2011 The ability of Thailand’s youth to use their knowledge Thailand faces many complex challenges that hinder and skills to meet real-life challenges has stagnated improvements in learning achievement overtime. over the last decade. Thailand’s achievement in These range from weaknesses in teacher training and reading, as measured by PISA, declined consistently support programs, to poorly-educated parents for from 2000 to 2006 and only a slight, though disadvantaged populations, to iodine deficiencies in statistically insignificant, increase is apparent from children. In addition, there is a misalignment 2006 to 2009. between the management of the key functions of the education system at the national level and Figure 3: Reading Performance in PISA overtime in East Asia accountability for results at the national level which Figure 3. Reading Performance in PISA overtime in East Asia 600 makes any needed system-wide reforms and initiatives to improve learning difficult to implement. Shanghai, China 550 Korea, Rep. Hong Kong, SAR Singapore System-wide initiatives are needed to address these Japan 500 problems but governance of the education system as a whole is fragmented. This reduces the capacity for 450 reforms to take hold. The Ministry of Education is comprised of five agencies; higher education, basic Thailand 400 Indonesia education, vocational education, private education, and; teacher issues. Each of the five agencies 350 operates independently within the Ministry of 2000 2003 2006 2009 Education with its own chief executive officer and its Source: World Bank EdStats / OECD own executive board. There is a multiplication of functions within each of the five agencies that govern Low achievement in Thailand is primarily an issue of the sector. Each agency has its own bureau for disparity in learning outcomes. While the distribution planning and budgeting, monitoring and evaluation, of learning achievement in Bangkok is almost administration, and finance. Consequently, the identical to that of the United States, the problem functions of planning and budgeting, monitoring and lies in areas outside which lag behind the city. Much evaluation, and administration and are not managed of the difference in learning between urban and rural in a way that is meant to be accountable for results at areas, for example, is attributable to differences in the national level across the education system as a the quality of education children receive and not just whole, but for results only within the purview of each to their socio-economic background. Public funding respective agency. for schools follows a funding-formula based primarily on level of education and the number of students. Towards a Growth Sustaining Education However, public education expenditures per student at the provincial level are positively correlated with Sector household education expenditures, suggesting Producing the skills needed by the labor market minimal compensatory expenditure. requires alleviating the disparity in education quality Figure 4: Disparity in distribution of achievement between Bangkok Figure 4. Disparities in distribution of achievement and a governance structure that is conducive to long- and elsewhere between Bangkok and elsewhere term system-wide reforms and initiatives. The size of productivity gains needed for growth require that high levels of learning occur across the country, not just in Bangkok alone. Sector-wide reforms are needed to improve learning overtime and to ensure that the education sector is responsive to the demands of the labor market. As many countries in Asia have shown with sustained coordination efforts it is possible for Thailand to significantly improve education outcomes in support of broader growth. Distribution of TIMSS achievement Source: Kernel density plot using Thailand TIMSS 2007 Math based on Ahuja et al. 2006 The World Bank in Thailand | Education 3 THAILAND: CHALLENGES AND OPTIONS FOR 2011 AND BEYOND September 2011 There are already several new initiatives underway to found positive impacts on enrolment, retention and improve the quality of education in Thailand that will learning achievement. There are a range of models help address these issues. These include the teacher for empowering school councils; some similar to the retraining program, recent strategic plans to improve community owned schools planned in the United the quality of teaching and education participation. Kingdom. There are also several pilot programs such as the One District One Lab School, English Program Schools, and There are also several examples of targeted and the Information and Communication Technology compensatory programs that are effective at Schools. These could be complemented by other improving education outcomes. Chile’s program initiatives. improved test scores significantly by providing support to the lowest performing schools. Mexico’s The cost of reducing the disparity in education quality compensatory program targeted schools in poor depends on how much of the disparity is due to communities and helped improve schooling allocation of resources and how much is due to how outcomes. However, these types of reforms may be well the resources are used. Because public funding hindered under the currently fractured governance for most schools is distributed uniformly (based on structure. Increasing alignment in decision making the number of students and the level of education), and accountability for results across the system alleviating disparity in education quality requires would enable and support reforms and initiatives in both ensuring that the use of resources is equitable education. Aside from organizational theory, a key and efficient as well as offsetting differences in component of aligning decision making and private resources and other non-monetary factors. accountability is publicizing information on results. At Recent analyses in Thailand suggest that much of the the national level, Office of National Education disparity in learning achievement could be alleviated Standards and Quality (ONESQA) and National by improving how resources are used. For example, Institute of Educational Testing Services (NIETS) students’ individual household characteristics explain provide performance measurement of schools in a significant but small portion of the difference Thailand, but there is no functioning feedback loop between the rich and poor. While compensatory from these agencies back to the decision making spending programs are needed, larger reductions in bodies in the Ministry of Education. In countries such disparity may by possible by improving education as South Korea and Singapore, top performers in practices and policies in disadvantaged communities, international assessments, there is a strong link but this requires an accountability mechanism that is between governance and the assessment agencies. responsive to local results and demand in order to There are also many examples of how information for induce these changes. results can be used for accountability sub-nationally down to the school level. There are numerous Increasing the involvement of parents and local models of school inspection systems and school communities in decisions that impact their school is report cards which have proven to have a positive one way to increase responsiveness to local results impact on learning achievement. However, the and demand. Parents through school board evidence that these alone are effective at improving committees currently have an advisory role over non- results is mixed for middle and high income salary expenditure at schools, but they have little countries; policy makers would need to be attentive influence over teacher selection and rewards. There to their design. have been numerous studies of school-based management reforms that have improved learning Accountability reform can be further strengthened if and other education indicators. Typically these aligned with teacher development. Teacher devolve various types of decisions—ranging from incentives and performance payments work well budgeting, to hiring and firing teachers, to curriculum when accompanied by school accountability reforms. design—to school councils which consist of parents Incentives that promote teacher performance, and other members of the community. For example, professional development, remuneration, allocation evaluations of school autonomy reforms in three and recruitment contribute to overall education Central American countries where school councils sector performance. were given autonomy over hiring and firing of staff The World Bank in Thailand | Education 4 THAILAND: CHALLENGES AND OPTIONS FOR 2011 AND BEYOND September 2011 What can be done? Policy Options for a Growth Sustaining Education Sector Priority Programs with High Payoffs Enhanced Accountability and Performance through Institutional Reforms  Invest in early child development for maximum returns including by enforcing measures such as  Integrate functions across agencies within the universal salt iodization for the elimination of education sector as regards to budgeting, iodine deficiency. monitoring and evaluation, administration and finance.  Improve the teacher supply and quality by reforming selection, professional development,  Increase social accountability in the education and associate remuneration with performance. system through the annual publication of performance reports for school results along with  Create programs that target low performing the financial resources provided to the school. students and schools in order to improve learning This would enable the effective involvement of achievement for disadvantaged communities parents in decisions that affect their schools.  Establish feedback loops so that performance information from Office of National Education Standards and Quality (ONESQA) and National Institute of Educational Testing Services (NIETS) feeds into the decision making process at the Ministry of Education. This Policy Note draws is part of the on-going Thailand-World Bank Country Development Partnership on Education and skills development and draws on the key findings of the following reports: Making Schools Work. (Bruns, B., D. Filmer, H. A. Patrinos—The World Bank 2011) Analysis of Efficiency of Educational Expenditures. Discussion Paper 5, Thailand Public Finance Management Report. (The World Bank 2011) Skills for Ideas-Led Growth with Equity. (The World Bank 2011) Learning Outcomes in Thailand: What Can We Learn from International Assessments? (The World Bank 2011) For more information please contact Kevin Macdonald kmacdonald1@worldbank.org The World Bank in Thailand | Education 5