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Skills anticipation in Estonia (2023 Update)
Summary
Overview of the Estonian approach
Although skills anticipation does not have a long history in Estonia, the country has in recent years invested in skills anticipation to develop a more holistic and coordinated system. As such, the process continues to offer innovative opportunities over the coming years for the use of skills anticipation outputs in policymaking by various stakeholders.
Estonia currently undertakes the following exercises:
- Skills anticipation practices like assessments, and foresight (reviewing past trends at national and sectoral levels and assessing how various drivers of change will affect future skills demand) (OSKA);
- Annual labour supply and demand forecasting by sector, occupation, and education (OSKA);
- Short-term labour demand barometer by region and occupation (carried out by Töötukassa (Public Employment Service)).
Notably, the System of Labour Market Monitoring and Future Skills Forecasting (Oskuste Arendamise Koordinatsioonisüsteem, OSKA), funded primarily by a European Social Fund (ESF) grant, was established in 2015 to better coordinate skills anticipation activities. One of the goals of OSKA is to better involve stakeholders in the process of skills anticipation. A coordination council, comprising stakeholders, has been set up to oversee the system. Furthermore, sectoral expert panels where stakeholders and experts from the labour market sit also play a large role in the skills anticipation exercises.
By combining existing quantitative projections with qualitative inputs from experts, the Estonian skills anticipation approach provides a holistic view of the labour market.
Description
Until 2015 skills anticipation in Estonia was primarily based on the annual employment forecast conducted by the Ministry of Economic Affairs and Communications (Majandus- ja Kommunikatsiooniministeerium). In recent years, however, Estonia has invested substantially in reforming its skills anticipation process, including the OSKA system of labour market monitoring and skills forecasting. OSKA, which was launched in 2015, produces data and analyses that supplemented the Ministry of Economic Affairs and Communications’ forecasts and provided input for it. Since 2022 a new quantitative forecast model was established by OSKA that replaced the former annual employment forecast conducted by the Ministry of Economic Affairs and Communications.
The new forecast model is quantitative in nature, relying on the data from the relevant registers and surveys, as well as data provided by Statistics Estonia (Statistikaamet), but also integrating input from OSKA sectoral foresights.
OSKA sectoral foresights and other ad hoc studies subsequently incorporated further qualitative and quantitative assessments to augment the new forecast and produce deeper insights into skills demand, supply, and mismatch for the coming 10 years. In this regard, OSKA provides a holistic system of skills anticipation, by incorporating both the quantitative employment forecast and offering a deeper analysis of individual sectors by utilising expert knowledge drawn from stakeholders and social partners. OSKA has been implemented as a joint action by the Ministry of Education and Research (Haridus- ja Teadusministeerium), the Ministry of Economic Affairs and Communications the Ministry of Social Affairs (Sotsiaalministeerium) and the Ministry of Finance (Rahandusministeerium). It is mainly financed by the ESF. The Estonian Qualifications Authority (Kutsekoda) is responsible for the daily administration of OSKA. Other stakeholder organisations also contribute to skills anticipation.
In addition, various other independent bodies, such as think tanks, trade unions and employers’ confederations, also conduct skills anticipation exercises. These are not carried out on a regular basis and tend to have a narrow focus. Enterprise Estonia (Ettevõtluse Arendamise Sihtasutus), for instance, carried out studies on manufacturing sectors prior to the introduction of OSKA. The foresight activities administered by the Estonian Development Fund (Eesti Arengufond) until its dissolution also produced several in-depth studies of specific growth sectors. Another relevant body is the Foresight Centre (Arenguseire Keskus), a think tank at the Estonian parliament. Its tasks include analysing long-term developments in the society, identifying new trends and development avenues, and drafting development scenarios. The Foresight Centre bases its studies on a variety of possible developments and outlines alternative scenarios.
In 2017-2019, Cedefop offered technical support to Estonia, aiming at the review of skills governance in the country, focusing on OSKA. Based on stakeholder perspectives on its achievements so far, and identification of development opportunities, the review led to the development of a roadmap with several specific actions, such as the mapping of strategic directions, reshaping the methods, and communicating the results with more impact.[i]
Aims
The forecasts conducted by the Ministry of Economic Affairs and Communications were mainly used to formulate vocational education policies. They have thus served to provide a guide for policymakers in deciding upon the content of education programmes delivered by the state.
With the arrival of OSKA, the overall goals of the skills anticipation activity have been revised and expanded. The information provided by the process is now intended not only to advise on educational policy (both vocational, higher VET and higher general education), but also to provide an information base that will be of use for career counselling services, qualification design, curriculum development in education institutions, and for the financing of education institutions and studies. Furthermore, the process also aims to improve the dissemination of results by closely involving relevant stakeholders in skills anticipation.
Since 2020, in addition to general and sectoral reports, OSKA conducts ad hoc studies on labour and skill needs/mismatches. The aim is to better address stakeholders’ needs and to investigate specific problems deeper. The topics can be proposed by stakeholders and must be approved by the OSKA Coordination Council. In 2020-2022 ad hoc studies focused on the effects of Covid-19 to employment and skills needs, digital skills, skills for the green transition, sectoral digital skills, generic skills and R&D labour and skills needs in enterprises.
Legal framework
OSKA, and the role of the governing bodies that administer it, are codified in the amended Professions Act (2015)[ii].
Governance
The Estonian Qualifications Authority is responsible for the administration of OSKA. The skills anticipation activities are organised by the OSKA Coordination Council, comprised of five ministries (the Ministry of Education and Research, the Ministry of Economic Affairs and Communications, the Ministry of the Interior, the Ministry of Social Affairs, and the Ministry of Finance) and other stakeholder organisations (Bank of Estonia, employers’ and trade union representatives, public employment services).
The role of the Council is to select the economic sectors to be studied each year; commission new analysis and research; approve the results of general labour forecast as well as sectoral reports; submit an overview of skill needs to the government; make recommendations to other governmental bodies or institutions on how to best meet labour market skills needs; and prioritise among occupational groups, identifying those with the highest demand or facing significant skill gaps. This prioritisation process is relevant to various stakeholders, such as policy makers, educators, employers, and job seekers, as it helps align workforce development efforts with the current and future needs of the Estonian labour market. Annually, the Coordination Council presents an overview and recommendations on the state of the labour market and skills to the government.[iii]
24 sectoral expert panels (20-30 sectoral experts each) have been established since 2015 as part of OSKA. These panels follow and assess developments and trends within their sector, contribute to the formulation of sectoral employment forecasts and skills foresights. They also develop proposals on better balancing labour and skills demand and supply. Since 2016, OSKA has analysed around five to six sectors a year. The aim is to cover all economic activities every five years.
The role of stakeholders
The main stakeholders in skills anticipation activity are policymakers, employers, trade unions, education and training institutions, and various third-party organisations that have an interest in skills. Until recently, the limited tradition of social partnership in Estonia and the lack of formal inclusion of stakeholders in the skills anticipation process limited their contributions to policymaking. Consequently, improving the inclusion of stakeholders has been central to the strategic development of OSKA and its methodologies and analyses. Since its launch, stakeholders have begun to consider OSKA as a vital resource (Cedefop, 2020a).
Before the implementation of OSKA, the role of stakeholders was limited to providing comments on the forecasts made by the Ministry of Economic Affairs and Communications. With OSKA now in place, the role of stakeholders has expanded considerably. OSKA guarantees stakeholder input in policymaking through the OSKA Coordination Council, which has the power to make recommendations regarding labour market and educational policy. It also has the power to determine which sectors receive a greater focus in OSKA, and comments on the assessments used by policymakers in decision-making.
The implementation of this system has both increased the involvement of stakeholders and created a systematic process by which they can provide input into skills anticipation. Representatives from employers and trade unions have seats on both the OSKA Coordination Council and the sectoral expert panels. Additionally, the process places an emphasis on the input of sectoral experts – who are usually representatives of key stakeholder institutions – in its assessments of skills needs and supply. As skills anticipation in OSKA aims to improve the matching of labour market needs with training resources, representatives of educational institutions also have a sizeable role in the process.
Target groups
The results of the skills anticipation activity in Estonia are intended for use by employers, policymakers, education and training institutions, career and student counsellors, and other interested parties. The information helps policymakers determine the curriculum for state-run schools and adult training programmes – such as those run for unemployed people by the Ministry of Social Affairs. The information is also used by policymakers in assigning budgets to different educational sectors and institutions. Career and student counsellors can use the results to improve their advice and guidance.
Funding and resources
The OSKA system has been allocated a budget of €0.8 million for 2018. Of this amount, up to 85 per cent is financed by the ESF while the remaining 15 per cent is financed by the Estonian government, specifically in cooperation with the Ministry of Education and Research, the Ministry of Economic Affairs and Communications and the Ministry of Social Affairs. [iv]
In 2015-2022, OSKA received 85% of its financing from the European Social Fund, while the remaining was covered by the Estonian government. The Estonian Qualifications Authority that oversees the administration and development of OSKA, has recently been granted 9 299 300€ under a new ESF funding cycle (1.08.2022-31.08.2029).[v]
Methods and tools
There are several tools used for undertaking skills anticipation in Estonia.
Skills assessment
OSKA marks the first implementation of a structured and routine skills assessment process within Estonia. Skills assessment is part of the ‘Estonia 2035’ strategy, which aims to match the labour market and skill needs with the education system. The development of OSKA as a data analysis and forecasting tool is central to that part of the strategy.[vi]
The OSKA programme combines the quantitative data through annual employment forecasts and labour demand-supply balance estimations, with qualitative data in the form of expert contributions (e.g. via expert panels) and other relevant quantitative and qualitative data (such as previous sectoral surveys or development plans).[vii]
These experts are drawn from the sectoral skills councils as well as from various stakeholders within each sector. By combining the forecast data with other relevant information and the opinions of experts and stakeholders, the process provides a more detailed analysis than would be provided by the forecasts alone.
The outputs of these exercises are in the form of five to six annual in-depth reports on individual sectors. The OSKA Coordination Council chooses which sectors are to be analysed each year, with each sector being examined every five years on average.[viii] In addition, the cooperative structure of the system is also intended to ensure that there is a constant flow of information from each sector to stakeholders, policymakers, and society.
As part of the OSKA system, an overview report is published in addition to the in-depth sector reports (the first one was published in early 2017).[ix] This report comments on the state of the labour market and anticipated changes over the next 10 years, as well as the most substantial changes in skill requirements, based on the quantitative skills forecast and the OSKA sectoral reports. The most recent report concerns OSKA general forecast 2022-2031 and it is based on the new forecast model. It gives an overview of the Estonian labour market and the labour force demand and training requirements until 2031.
Skills forecasts
Since 2003 the Ministry of Economic Affairs and Communications has conducted an annual labour need forecast for the forthcoming seven to 10 years as part of an economic review.[x] This forecast included around 40 sub-sectors within the national economy as well as five major occupational groups (which were further disaggregated into ISCO 4-digit level/detailed occupation level). Estimates of expansion and replacement demand for sectors and occupations were made as part of the forecast. Demographic and educational data were also used to forecast skills supply. The results also presented the degree of skills mismatch in each sector by occupation. Since 2022 the quantitative forecast is included in OSKA. The first general forecast report, based on the new forecast model, was based primarily on statistical data collected by Statistics Estonia, and also included migration data from the Estonian Tax and Customs Board and the Estonian Police and Border Guard Board and education data from EHIS. Prior to finalisation of the forecast, the Ministry had occasionally offered stakeholders the opportunity to comment on the results.
The former labour forecast model was replaced by a new OSKA labour forecast model in 2021-2022. The aim was to centralise the medium-length labour forecasting exercises. Since new data sources (as employment register, wages register) became available, a new data model was created for forecasting. This is mainly based on the combined data of different registers (employment, unemployment, occupations, wages, immigration, residency, population, education). As the estimations for expansion demand are drawn from OSKA sectoral studies, foresight information and labour market megatrends are now better included in the forecast. Compared to before, also more granular and up-to-date data is being possible to use, especially on occupations, regionality, wages, etc. Due to the availability of new data sources, new modules have been possible to include into the forecast model, as employment flows between sectors and occupations, migration and regional forecast. Data from the new modules will be published step by step, as there is need for longer time series for the forecast to be robust. Some new modules are to be developed during the next few years, as vacancies and unemployment.
During the 2022-2029 period, Estonian professional qualifications system will be reformed; the reform will be carried out by the Estonian Qualifications Authority. As part of the reform, a national skills register and skills profiles will be established and interlinked to occupational standards and OSKA. In 2022, the first version of national skills register was already developed by the Estonian Qualifications Authority. During the next years the further development of the register and skills profiles (as well as linking skills to occupations and sectors) will give further possibilities for OSKA labour forecast to also include information on granular skills, in addition to occupations.
Since its introduction, OSKA has been publishing annual forecast reports, called ‘Estonian Labour Market Today and Tomorrow’, with the latest version concerning the period 2019-2027. These forecasts were published in cooperation with the Ministry of Economic Affairs and Communications and the Estonian Unemployment Insurance Fund, outlining the skill needs in the labour market for the next eight years.
One of the strengths of OSKA forecasting is its methodology, which combines qualitative and quantitative methods. The development and improvement of the methodological expertise remains one of the core strategic priorities for OSKA (Cedefop, 2020a).
Similarly, the forecasts are carried out at the national level; simplified calculations of regional projections are sent to relevant institutions but are not made publicly available. This limits the use of forecast results in local-level planning. As more data on regional labour market has become available, an effort is made to also develop labour forecasts on NUTS3 level, but the small size of the Estonian labour market is undermining the reliability of regional forecasts.
There did not appear to be any systematic or regular skills forecast exercises in Estonia before the development of OSKA. Over the years, a number of sector-specific studies and analyses have been commissioned by various organisations on an ad hoc basis.
As part of its pan-European forecasting activities, Cedefop produces skills forecast for Estonia. Additionally, the ongoing OECD PIAAC (Programme for the International Assessment of Adult Competencies) is another international study where Estonia is assessing its skills needs. The first results of the latest survey wave are expected to be published by the end of 2024.[xi]
Skills foresight
In addition to the sectoral and general reports, OSKA also publishes other ad-hoc skills foresight reviews. For instance, the 2021 OSKA trend maps examine the impact of future macrotrends on labour markets and skills needs. These trends include the spread of digital technologies, environmental sustainability, globalisation, demographic change, and a change in value systems. The OSKA trend maps have used analyses of experts and think-tanks around the world, reviews prepared by international organisations and consultancies, as well as Estonian and international development documents, and previous OSKA studies.
In 2016, OSKA published the Work and Skills 2025 (Töö ja Oskused) report, which provides information on, among others, trends in the labour market and the qualifications that will be required by the future labour force.
Other skills anticipation practices
Since 2016, the Estonian Unemployment Insurance Fund (Eesti Töötukassa) has been publishing a ‘Labour Demand Barometer’.[xii] The barometer assesses short-term, general trends in the labour market by occupation using a method of forecasting based on employers’ perspectives. Two indicators are taken into consideration:
- how employers’ demand for labour will change over the next 12 months, especially the demand for specific occupations; and
- based on the assessment of the first indicator, whether there will be a labour surplus or shortage in occupations after these 12 months.
The assessment of the indicators and the resulting estimates which are fed into the Barometer are developed by the regional departments of the Estonian Unemployment Insurance Fund, with the involvement of external experts as required.
Dissemination and use
Use of skills anticipation in policy
Before the introduction of OSKA, forecasts of future employment demand were mainly used by the Ministry of Education and Research to plan the national curriculum and determine the types of state-funded vocational education programmes to be offered. The analyses and forecasts provided by OSKA provide essential input to employment and education policies, and some stakeholders see its added value also in innovation, economic, and business policies (Cedefop, 2020a).
The Estonian Qualifications Authority also cooperates with stakeholders to share relevant information from the OSKA forecasts. So far, a successful partnership has been established with the Public Employment Service, which will use OSKA results in the design of active labour market policies.
Target groups’ uses of skills anticipation outputs
The intended end-users of the skills anticipation outputs are policymakers, employers, career counsellors, designers of curricula, teachers, and occupational qualification councils (Melesk et al., 2018). A constantly developing system of skills anticipation is a strategic objective of sustainable development in Estonia, informing employment and education policies. Through representation within OSKA’s system of sectoral expert panels, employers should now be able to more easily access the data generated by the skills anticipation activity. The most likely use of the information among employers will be to pursue developments within their own sectors as well as the national labour market.
Individuals usually make use of the system’s outputs through intermediaries such as student counsellors/careers advisers. The information can be used to enhance the advice provided by these intermediaries and to help them guide individuals towards appropriate programmes or qualifications. For instance, the Vali-IT programme is a reskilling course that makes use of OSKA’s analyses to provide active and intensive opportunities in ICT for adults with higher education qualifications. In addition, in 2019 a web portal on occupations and career outlook was launched by OSKA, targeted to both individual users and career counsellors.
Stock-taking studies of OSKA have concluded that the strengths of its anticipation exercises rely on its ability to innovate and redesign its methodologies. This includes a systematic review and update of OSKA’s target groups (Melesk et al., 2018; Cedefop, 2020a).
Please cite this document as: Cedefop. (2023). Skills anticipation in Estonia. Skills intelligence: data insights. URL [accessed DATE] |
Bibliography
- Cedefop. (2019). 2018 Skill forecast in Estonia.
- Cedefop. (2020a). Strengthening skills anticipation and matching in Estonia: capitalising on OSKA’s potential to realise national ambitions. Luxembourg: Publications Office of the European Union.
- Cedefop. (2020b). Developments in vocational education and training policy in 2015-19: Estonia. Cedefop monitoring and analysis of VET policies.
- Cedefop. Timeline of VET policies in Europe.
- EEPO. (2015). Country Fiches on Skills Governance in the Member States – Estonia. Developed by the European Employment Policy Observatory for the European Commission. Brussels: European Commission.
- Empirica. (2014). e-Skills in Europe: Estonia Country Report.
- Enterprise Estonia
- Estonian Qualifications Authority
- European Commission. (2019). European Centre of Expertise (ECE) in the field of labour law, employment and labour market policies. Labour Market Policy Thematic Review 2019: Skills imbalances. Estonia
- European Commission/ CEDEFOP/ ICF International/. (2014). European Inventory on Validation of Non-Formal and Informal Learning 2014: Country Report Estonia. Brussels: European Commission.
- Government of the Republic of Estonia. (2021). Estonia 2035 strategy: Skills and Labour Market
- ILO/Cedefop/OECD/ETF/. (2017). Skill needs anticipation: Systems and approaches. Analysis of stakeholder survey on skill needs assessment and anticipation.
- Johnson, M. (2019). European inventory on validation of non-formal and informal learning 2018 update: Estonia
- Melesk, Kirsti; Haaristo, Hanna-Stella; Haugas, Sandra. (2018). Tööjõuvajaduse seire- ja prognoosisüsteemi OSKA rakendamise analüüs (Implementation of the Labour Market Monitoring and Future Skills Forecasting System OSKA). Tallinn: Poliitikauuringute Keskus Praxis
- Ministry of Economic Affairs and Communications
- __ Tööjõuvajaduse ja -pakkumise prognoos aastani 2024.
- Ministry of Education and Research
- Ministry of Finance
- Ministry of Social Affairs
- Nurmela, K. (2011). Social Partnership for Anticipating Change in the Labour Market: National Paper Estonia. Talinn: Praxis.
- OSKA
- OSKA methodology
- __ (2018). Estonian Labour Market Today and Tomorrow 2018.
- Riigi Teataja. (2015). Professions Act.
- Sihtasutus Kutsekoda. (2016). Töö ja oskused 2025.
- Silla, E., Aarna, O., Orion, K., Haller, A., Murasov, M., Reinhold, M. (2014). Estonia: VET in Europe – Country Report 2014. CEDEFOP REFERNET.
- Statistics Estonia
- Unt, M. (2016). Skills Forecasting in Estonia: A Shift Towards Policy Driven Approach.
Endnotes
[i] See Cedefop. (2020a).
[ii] Ibid.
[iii] More on OSKA management at https://oska.kutsekoda.ee/en/oska-management-methodology/oska-management/
[iv] Numbers are from the OSKA website – accessed at http://oska.kutsekoda.ee/en/oska-management-methodology/esf-programme/ - to be updated, please see further: https://www.kutsekoda.ee/esf-2022-2029/
[v] This information is available on the Estonian Qualifications Authority website (in Estonian) https://www.kutsekoda.ee/esf-2022-2029/
[vi] More on the strategy on the Estonian government website: https://valitsus.ee/en/estonia-2035-development-strategy/necessary-changes/skills-and-labour-market
[vii] The methodology of OSKA can be accessed at http://oska.kutsekoda.ee/wp-content/uploads/2016/04/Metoodika-loplik.pdf
[viii] All the sectoral reports, organised by the year of publishing, are available on OSKA website https://oska.kutsekoda.ee/en/oska-sectors-2/
[ix] The 2017 report accessed at http://oska.kutsekoda.ee/wp-content/uploads/2017/02/T%C3%B6%C3%B6turu_uuring_terviktekst.pdf
[x] The interactive visualisation of the labour demand forecast (horizon 2029, base years 2018–2020) can be accessed at https://www.mkm.ee/en/economic-overview
For the period 2019-2027 see https://oska.kutsekoda.ee/wp-content/uploads/2020/05/T%C3%B6%C3%B6j%C3%B5uprognoos-2019_2027_terviktekst.pdf
[xi] More information on the Ministry for Education and Research website https://www.hm.ee/en/ministry/statistics-and-analysis/piaac
[xii] See Eesti Töötukassa website https://www.tootukassa.ee/en/barometer/method
Data insights details
Table of contents
Page 1
SummaryPage 2
DescriptionPage 3
Methods and toolsPage 4
Dissemination and usePage 5
BibliographyPage 6
Endnotes