A note on skill formation in higher education

Higher education is facing many challenges, including increased student enrolments, diversification of the student population and decreasing budgets. Meeting the demands of the labour market is another of the major challenges faced by higher education.
In the area of meeting demands of the labour market, the role of higher education has significantly changed over the past century. When higher education was still elite education, graduates were certain to find good jobs. Nowadays, getting a higher education degree does not automatically guarantee a good position on the labour market. Between 2008 and 2011, the unemployment rate of young adults with a higher education degree has risen from 3.3% to 4.8% in OECD countries as a result of the economic crisis (OECD, 2013). These figures do not take into account the probably substantial number of graduates who avoided unemployment by accepting jobs for which they are overqualified and in which they are not able to put the skills they acquired in higher education to full use.
Questions therefore arise as to whether higher education meets the demands of today’s labour market. Could higher education contribute more to the innovative capacities of economies? Should more attention be paid to the so-called 21st century skills? If so, which ones? Should higher education produce more generalists to keep up with the fast changing world? Or should it focus more on producing specialists who can deal with the increasing complexity of the work to be done? Should higher education focus on imparting skills that increase short-term employability, or should it focus on imparting skills that ensure long-term employability?
These are not easy questions to answer and we need a more systematic approach for dealing with them. This paper outlines a framework to help think about skill formation in higher education in a more structured way.