Skill formation in Uruguay: what are the required labour qualifications for development?

Patrón, Rossana
Terra, María Inés

2010-05

LC/W.321

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At the global level, trade in services has been the most dynamic sector, with an average growth rate about double that in the primary and manufacturing sectors. However, the three activities have a completely different composition in terms of type of labour, services being the most skill-intensive. In Uruguay, the formation of human resources shows several weaknesses; which leads one to ask: Is Uruguay prepared to take advantage of the opportunities open in the global market? If not, what are the consequences? A simulation exercise was tried consisting of an increase in external demand for skill-intensive services, following the global trend of trade in services and the increasing participation of Uruguay in such trade. The results show that, in a context where the educational system does not improve its performance, the scenario of increasing external demand for services leads to an increase in the wage gap across qualifications. But this is not a necessary result. Educational policies aiming at improving the efficiency of the education sector will contribute to a better matching between demand and supply of qualifications, allowing the expansion of dynamic sectors with a reduction in inequality.

Includes bibliography

TRADE IN SERVICES; ECONOMIC DEVELOPMENT; LABOUR MARKET; CAPACITY BUILDING; EDUCATION; COMERCIO DE SERVICIOS; MERCADO DE TRABAJO; DESARROLLO ECONOMICO; DESARROLLO DE CAPACIDAD; EDUCACION;