Bundesinstitut für Berufsbildung (BIBB)

What is the training crisis costing the government?

BIBB analyses expenditure on the promotion of training by the Federal and Länder governments

A high demand for training positions and too few positions is forcing the government to take targeted action to promote vocational education and training. A significant portion of training positions are partially or completely subsidised at present by public funding. It is difficult to obtain an overview of promotional funding, however, due to the plethora of funding agencies and promotional programmes. A research project carried out by the Federal Institute for Vocational Education and Training (BIBB) entitled "Public Promotion of In-company Training Measures" in the dual system sheds light on the scope, structure and development of public promotion of training over the period 1997-2001.

While on the one hand financial incentives and supportive measures in the guise of public grants help boost the supply of training positions over the short term, on the other hand this creates the impression of creeping "nationalisation" of the dual training system. Criticism levied at the lack of transparency with regard to overall public expenditures (in particular the expenditures of the Länder to promote training), the fact that company responsibility for the funding of training is being increasingly undermined and at the same time doubts regarding the efficacy of this funding were the issues addressed in a BIBB research project entitled "Public Proomotion of In-company Training in the Dual System", which was carried out from the end of 2000 to the middle of 2002. The research project consisted of a broad survey of public promotion of training broken down according to scope, structure and development over the period 1997-2001, examining the effectiveness of promotional measures in a case study of the Training Programme for the New Länder funded by the Federal and Länder governments over the period 1996-1999.   The analysis of government expenditures on the promotion of training is especially concentrated on expenditures by the Federal and Länder governments and expenditures by the Federal Employment Agency to promote initial training. Here it has at the same time been argued that promotional expenditures by the Federal Employment Agency and the expenditures of the Federal government on training are relatively well documented, while the Vocational Education and Training Reports or training funding reports of the Federal-Länder Commission with their summaries of Länder expenditures on the promotion of training have to be assessed as unsatisfactory.

Three focal points of promotion with respect to Federal and Länder expenditures

Looking at the expenditures by the Federal and Länder governments to promote in-company training, three focal points of promotion can be distinguished: corrective promotion to compensate for training deficits (direct partial government funding of in-company training positions or full subsidisation of non-in-company training positions), structural promotion to impove the conditions surrounding in-company training at companies (e.g. promotion of central training facilities, promotion of training in affiliated groups) and the promotion of target groups, which is aimed at youth requiring individual promotion.

 

Government expenditures on the promotion of training

The Federal and Länder governments promoted in-company training at companies to a tune of € 1,433 million in 2000. Approximately 44% of these total expenditures was primarily aimed at creating additional training positions, while more than one-fourth targeted an improvement in in-company infrastructure and training quality. The promotion of certain target groups and the provision of individual aid for trainees accounted for almost one-fifth of expenditures. Half of total expenditures were provided through the Federal government and one-third (34%) by the Länder. 16% of government expenditures on the promotion of in-company training was refinanced with resources from the European Social Fund (ESF).   The government contribution to the funding of in-company training at companies totalled € 7.8 billion in 2000 (inlcuding expenditures on in-company training promotion, not including schools of higher learning). At the same time Federal expenditures to promote in-company training over the years 1999 to 2001 averaged € 779 million. Approximately three-fourths of this amount was earmarked to compensate for the shortage of in-company training positions and to promote individuals in their integration into the training and labour market. With a share of 44% of Federal expenditures, corrective promotion represented a focal area on the annual average (non-in-company training positions within the framework of Article 4 "Fast-Track Programme of the Federal Government to Eliminate Youth Unemployment - Training, Qualification and Employment of Youth", Federal-Länder Training Position Programme for the New German Länder). The expenditures of the Federal government on promotion were concentrated on both the funding of the training process and financial support of individuals.   With € 731 million on annual average over the years 1997 to 2000 to promote in-company vocational training, the Länder attained almost the same volume. Almost two-thirds of Länder expenditures on the promotion of in-company training went to the new Länder over the period 1997 - 2001. In the western German Länder, on the other hand, the focus was on the promotion of the in-company infrastructure and training quality (44%). Looking at average figures over the years 1997-2000, almost two-thirds of Länder expenditures for the promotion of in-company training was with funds from the Länder themselves. 24% and an additional 12% were refinanced with financial resources from the European Social Fund and an additional 12% with Federal resources.   While an important focus of expenditures by the Federal government is improving structures, at the Länder level the emphasis is on bringing about a quantitative improvement in the supply of training positions.   Examining the Länder as a whole, a total of four areas of concentration in promotion can be identified: expenditures to promote non-in-company training, expenditures on the promotion of additional training possibilities, promotion joint vocational training facilities, affiliated group promotion and promotion of in-company training positions.   Besides the Federal and Länder governments, the Federal Employment Agency also contributes public funds to the promotion of vocational education and training on the basis of Social Code III. Here a rise in expenditures over the period 1997 to 2001 for individual promotion of vocational training and initial integration in a vocation for disabled persons was registered - from € 2.6 billion to about € 3.3 billion.   The Federal-Länder training position programme for the new Länder represents a pivotal area for the Federal and Länder governments when it comes to promoting in-company training. At the same time, non-in-company training programmes for so-called youth facing disadvantages in the market have been a focal point in the promotion of training in eastern Germany since the beginning of the nineties. The evaluation of the training position programme for the new Länder 1996 - 1999 carried out by the project is being continued through the current implementation of a BIBB project entitled "Evaluation of the Training Position Programme for Eastern Germany 2002 - 2004". Here in particular the development of a systematic database to encourage participation in Federal-Länder programmes and a comprehensive analysis of what becomes of these participants and the success of measures stand at the forefront of interest. The appropriateness of promotional measures for the target groups, aspects relating to the quality of training, the efficacy of promotional measures and the impact of promotion on the training behaviour of companies involved are central issues.     Current literature on the research project:

• Klaus Berger: "Was kostet den Staat die Ausbildungskrise?" Umfang und Struktur staatlicher Ausgaben zur Ausbildungsförderung, in: Berufsbildung in Wissenschaft und Praxis (BWP), year 32 (2003), v. 2, Zeitschrift des Bundesinsituts für Berufsbildung, pp. 5 - 9
• Klaus Berger, Günter Walden: Evaluierung der Bund-Länder-Programme zur Ausbildungsförderung in den neuen Bundesländern 1996-1999. Bestandsaufnahme, Schlussfolgerungen und Empfehlungen. Berichte zur beruflichen Bildung Heft 255. ed.: Federal Institute for Vocational Training. The Secretary General, Bonn-Bielefeld 2002.
• Klaus Berger, Günter Walden: Trends in public funding for in-company training in Germany: From dual to a plural system. In: Vocational training and lifelong learning in Australia and Germany. Burke, G. & Reuling, J. (editors). Australia Centre Series (2002) volume 5, pp. 135 - 149
• Klaus Berger, Günter Walden: Außerbetrieblich und doch "betriebsnah" - Zwischenbilanz und Perspektiven der Bund-Länder-Ausbildungsprogramme Ost. In: Berufsbildung in Wissenschaft und Praxis (BWP) year 31 (2002) v. 4, Zeitschrift des Bundesinstituts für Berufsbildung, pp. 17 - 21
• Klaus Berger, Günter Walden: (ed.): Öffentliche Ausbildungsförderung in Ostdeutschland unter der Lupe. Ergebnisse aktueller Evaluationsstudien. Berichte zur beruflichen Bildung, v. 258. ed.: Federal Instititute for Vocational Training. The Secretary General, Bonn- Bielefeld 2003.