SMEs, youth entrepreneurship and the Austrian Dual VET System New York, June 27th 2018 Stephan Spazier Austrian Deputy Trade Commissioner for the USA
AGENDA Brief overview of the Austrian economy and importance of international trade and investment Facts and figures about Austrian SMEs Youth unemployment, entrepreneurship and the startup scene with special focus in Austria Overview of the Austrian dual education, apprenticeship and VET system
Heart of Europe and Gateway to the East European Union Area: 4.3 m. sq.km. Population: 510 m. GDP: EUR 14,815 bn. Member States: 28 Official Languages: 24 3 Source: ABA, Eurostat
More than 300 International Companies including 28 Fortune 500 corporations make Austria the preferred location for CEE headquarters. Proximity to the target market Infrastructure Productivity and motivation Stability Tax advantages Quality of life 4
Significance of Austrian Exports 2017 export of goods: EUR 141.9 bn 2017 import of goods: EUR 147.6 bn 58,000 exporters (ten percent of Austria s companies) 54 percent export sales ratio USD 19,200 per capita generated in export - the world s seventh largest exporter per capita 5 Source: Statistics Austria, UN, WTO
Austrian Exports 2010 2018 6 Source: Statistics Austria, WIFO *) prel. data, **) outlook
Austrian Exports - Top Export Markets (2017) Mill. EURO 7 Source: Statistics Austria
Top Export Products (2017) 8 Source: Statistics Austria
Austria s Export Destinations by Region (2017) 9 Source: Statistics Austria
Facts and figures about Austrian SMEs 99,7% of all Austrian companies are SMEs account for 61% of country s GDP (114 Mrd. ) 5 out of 6 SMEs have less than 10 employees Well advanced educational programs apprentice training, mandatory internships etc. Still gender disparity: 7 out of 10 company founders are male but percentage of female entrepreneurs is growing Young Austrian entrepreneurs are primarily opportunity-driven biggest spur is the desire to be independent, accquiring personal fulfillment and to reach financial independency
Youth unemployment rate in Austria 13 12 11 10 9 8 7 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Jungend-Arbeitslosigkeit in Österreich
Youth unemployment rate in Europe Quelle: Youth unemployment rate in Europe by countries (Mendonca, M. 2015).
Self-employment rate in Europe Quelle: Self-employment rate (OECD, 2017)
Youth entrepreneurship in Austria (Start-up scene) 500-1000 new start-ups every year Currently 2000-4000 start-ups are registered 61% are focused on digital innovation (ICT) Highly focused on international markets due to restricted market size (opportunities) 41% of Austrian Startups put their focus on European markets 11% prioritize doing business within the USA and China Within the EU, Austrian start-ups belong to the most effective ones Around 24% of Austrian new businesses receive(d) financial support through business angels 18% make use of venture capital
1.0 Youth entrepreneuship in Austria (Start-up scene) Two major trends in Austria at the moment: Hybrid entrepreneurship: To be self-employed while working for another company Social entrepreneurship: Focusing on businesses with either social or environmental benefits for general public
1.0 Challenges of Austrian youth entrepreneurs Highly competitive market environment, especially in ICT industry limited infrastructure to be competitive and often reduced opportunities outside urban areas Lack of governmental support (restricted grants) Comparably high bureaucratic effort to start and maintain a business Relatively little investment platforms, lack of crowdfunding and business angel platforms
THE AUSTRIAN EDUCATION SYSTEM
Apprenticeships combine companybased training (periods of practical work experience at a workplace) with school-based education (periods of theoretical/ practical education in a school or training centre) Apprenticeships lead to a nationally recognised qualification Most often there is a contractual relationship between the employer and the apprentice, with the apprentice being paid for his/her work
APPPRENTICESHIP IN AUSTRIA Learning by Doing Company part-time vocational school 80 % <--> 20 % practical training 80 % Apprenticeship schoolbased training 20 % YOUR APPRENTICESHIP new on YouTube: https://www.youtube.com/watch?v=_tv2pxv5ge0
DUAL TRAINING IN AN APPRENTICESHIP In the apprenticeship training system, the two places of learning are the training enterprise and the part-time vocational school. The apprentice is in a training relationship with his or her training enterprise and student of a part-time vocational school at the same time. (demand led system) The enterprise-based part of dual vocational training makes up the major part of the apprenticeship period (up to 80%). The apprenticeship-leave examination is taken in front of professional practitioners. The main focus in this examination is on the practical skills and abilities required for the occupation. 200+ apprenticeships ( professions ) with a 2-4 years training period basis for Higher VET : Meister and other professional qualifications
THE AUSTRIAN APPRENTICESHIP SYSTEM Figures o o o Approx. 30.000 training companies ( 10% of all companies) Approx. 110.000 apprentices Approx. 33.000 new apprentices per year ( 38% of an age cohort) Modularisation of apprenticeship training o o 3 modules: (basic/main/special) Currently 11 modular apprenticeships, e.g. installations and building technology, metal technology, mechatronics, electrical engineering, electronic engineering, motor vehicle engineering, and others Continuous modernization o Since 2000, more than 2/3 have been modernized or newly created
USA Canada Mexico Japan Korea New Zealand Greece UK Iceland Ireland Portugal Turkey France Spain Denmark Australia Poland Germany Norway Sweden Italy Luxembourg Hungary* Switzerland Netherlands Finland Slovakia Belgium Czech. Rep. Serbia AUSTRIA share of upper secondary students (in %) M G C K U J N D A H P T L B C S F I EDUCATION SYSTEMS: SHARES OF STUDENTS IN UPPER SECONDARY EDUCATION BY PROGRAMME TYPE 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 100% Combination school- and work-based IVET (DUAL SYSTEM) 0% Fully school-based IVET GENERAL education Source: ibw based on EUROSTAT data; * internet based data (not strictly comparable to Eurostat)
THE AUSTRIAN APPRENTICESHIP SYSTEM grammar school ~39 % ~22 % ~39 % VET school or VET college part-time vocational school (apprenticeship) almost 80% of young people sign up for VET programmes almost 40% of young people sign up for apprenticeship training
MAIN VET PROGRAMMES IN AUSTRIA (1) Dual Apprenticeship training (around 38% of 16+ year-olds) Training enterprise (80%) and part-time vocational school (20% of time) Demand-led system: apprenticeship contract between enterprise and apprentice Training is based on two regulations (ordinances): training company and school Approx. 200 apprenticeships ( professions ) in practically all branches of the economy with a 2-4 years training period depending on the profession Basis for Higher VET : Meister and other professional qualifications Demand driven, market logic Full time school based VET (around 40% of 16+ year-olds) VET Schools and VET Colleges Entirely school based but some programs provide for mandatory internships Combination of general and vocational education Different types and duration (technical, commercial, agricultural, tourism, social, humanities, health) Double qualification in VET-colleges: VET-diploma and university access Supply driven, entitlement logic
MAIN VET PROGRAMMES IN AUSTRIA (2) Training guarantee by AMS (Austrian Public Employment Service) Support in finding an apprenticeship in a company Workshop based programs in the conceptual framework of dual apprenticeship training (supra-company apprenticeship training ÜBA ) Continued Vocational Education and Training (CVET) Relatively unregulated Diverse range of training providers Formal and non-formal qualifications Programmes at all levels from basic to higher VET
Governance: Distribution of competences Company level School level Training company Local Part-time vocational school Apprenticeship offices Provincial Regional Advisory Board on Apprenticeship Provincial governor Ministry of Economy Federal Advisory Board on Apprenticeship Federal Ministry of Education
Federal level: Areas of responsibility Ministry of Economy Company-based part of apprenticeship training Vocational Training Act (BAG) Training regulations (apprenticeships) Ministry of Education School-based part of apprenticeship training School Organisation Act (SchOG) Framework curricula for apprenticeships Federal Advisory Board on Apprenticeship Representatives of the social partners (e.g. Chambers) Expert opinions given to the Federal Ministry of Science, Research and Economy (BMWFW) (e.g. on the restructuring of apprenticeship trades)
Provincial level areas of responsibility Apprenticeship offices Checking the suitability of the training companies Checking and recording the apprenticeship contracts Vocational training authority of the first instance Advising apprentices and training companies Regional education board Implementation of the framework curricula Pedagogical and subject-specific supervision Provincial governor Decision on appeals in apprenticeship training matters Nomination of the members of the respective Regional Advisory Boards on Apprenticeship (LBAB) Vocational training authority of the second instance Regional Advisory Board on Apprenticeship Advice in all matters of apprenticeship training
Apprenticeship periods 1st app. year 2nd app. year 3rd app. year 4th app. year 2 or 2½years: a few apprenticeships e.g. beautician, clothing producer 3 or 3½ years: most apprenticeships e.g. bricklayer, office assistant, forwarding agent 4 years: a few apprenticeships e.g. dental technician Shortening of the apprenticeship period: Training in related apprenticeships (Related) previous school-based qualifications (such as for holders of the upper secondary school-leaving certificate, the apprenticeship period can be shortened by one year)
The apprenticeship contract forms the basis of the training is concluded in writing between the apprentice (or, in case of minors, their legal representative) and the training company The apprenticeship office examines the data of the apprenticeship contract and the suitability of the training company. They are therefore responsible for the accreditation of training companies.
Training at the company Company-based training curriculum: describes the competences which must be taught in the company Activity description: learning outcome-oriented description of the competences acquired by apprentices by the end of their training uniform Austria-wide regulation by decrees for each apprenticeship occupation Didactic approach: - training in a day-to-day working environment - under real-life working conditions - involvement of apprentices in the productive work process
Responsibilities and tasks of the Austrian Economic Chambers in dual VET Organisational implementation of apprenticeship training (e.g. apprenticeship exam) The initiative for the introduction of new apprenticeships and further development of existing apprenticeships often come from companies via Social Partners. Social Partners also submit opinions on draft trainings regulations
CONCLUSION: VET, especially DUAL vocational training: an increasingly important issue for the EU and worldwide a success factor for competitiveness crucial for the economic and social development
AUSTRIAN SYSTEM ABROAD: SUCCESSFUL EXPORT! Slovakia: Project Young Stars! Introduction of the Austrian model of dual training in Slovakia - by initiative and active participation of Austrian companies! Professions: Metal workers, metal technicians, mechatronics Degrees: Slovak apprenticeship degree, Slovak school leaving certificate Similar projects also in P.R. China, Bulgaria and Romania, Serbia (with ADA) Erasmus+ projects with: EUROCHAMBRES within a large scale European project implemented in 12 countries Further Erasmus+ projects with Croatia, Spain and others
Thank you for your attention!