Essays on the Chinese Skill Development System

Abstract

This dissertation focuses on the Chinese vocational education and training (VET) system – an arena that recently has been gaining growing importance in Chinese economic reform. My central argument is that the Chinese state is trapped in a dilemma in which it faces two flawed choices with regards to its ongoing reform attempts to upskill the Chinese workforce in the coming decades. During the past decade, the central government has been taking steps to decentralize a school-based national skill development system and adopt a more marketized model that integrates extensive employer input. But currently neither a relatively centralized school-based system nor a decentralized employer-led model has produced the institutional conditions needed for upskilling to occur in China. In the absence of a private governance tradition, and lacking a role that proactive employer associations can play in coordinating coherent training agendas at the industry level, the skill development system has become focused only on the short-term specific needs of individual employers. The current pre-employment skill formation process downplays long-term and general skills-focused training. In this introductory chapter, I develop this argument through a review of the relevant literature. Then in the three following chapters, each of which is geared toward a separate research agenda, I identify (a) the disorganization of the VET system and (b) the skill formation dilemma in China. Chapter 2 examines subnational variation within the Chinese VET system. I find that partly because of decentralization, Chinese vocational schools have adopted four distinctive skill development patterns: the high performance model, the industry-focused model, the local market-oriented model, and the labor agency model. I argue that skill development models reflect a combination of two institutional and two organizational factors that endow each school: state support and strategies, local industrial structures, a school’s institutional legacies, and its ownership. Schools vary in these endowments, and, thus, they demonstrate differences in skill development patterns. Chapter 3 focuses on an important employer strategy that is a response to the local market labor shortage: collaboration with vocational schools. I find that driven by a major external labor market failure – the skilled labor shortage – employers seek to shift part of their traditionally firm-based training to the workforce’s pre-employment skill formation process. The decentralized VET system allows schools to customize their training programs according to the specific skill needs of collaborating firms without being bound to any industry-level standards. I call this “training for a targeted brand” model, and I argue that it is essentially an employer strategy that pursues externalization of internal labor market practices to fix the external labor market failure. Its product is a flexible reserve of students who are equipped with a considerable amount of specific skills that are valuable to a certain firm, but the firm is not bound by employment relationships to these workers. Chapter 4 compares and assesses the early outcomes of two ongoing apprenticeship reforms by the Ministry of Education (MOE) and the Ministry of Human Resources and Social Security (MOHRSS). I find that the MOE has continued with a decentralized and disorganized approach to its reform, giving individual schools and employers complete freedom to devise a program, whereas the MOHRSS has adopted a top-down model and withheld control over the institution building process. Based on a three-level theoretical framework, I find that neither approach has generated ideal skill development outcomes, although the decentralized model has achieved relatively desirable performance. I then argue that the Chinese state has been trapped in a skill formation dilemma: until effective civil society governance is institutionalized to coordinate the VET process, the system will continue to not deliver ideal outcomes, and this will confound the state’s long-term upskilling agenda.