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Education and the economy Education is the development of human capital, just as investment is the development of phyeicel capital. Unless an economy has sufficient high quality end technologically advanced capital of both kinds, it will suffer from s lack of competitiveness due to the inability for that economy to experience productivity increases which match world stan- dordeltisd'concernthenthatCnnadn-pendsmorethanmost countries on education (more than any of the OECD countries per pupil) and yet gets so little in the way of return from the dollars spent. sewing lower than most countriea on atandar. dized math, science, and communication tests. The reasons for the poor results horn educational spending can be arrived at quickly. The solutions are more difficult to amve at so. today we will examine the inefficiencies in the educational system. Then, in another column, we will examine a few solutions. First, there is evidence that pupils in both reading and math learn more (as established by standardised testing) at the junior grades in classes of over 30 pupils than they do in classes of 18 pupils. Our school boards aim at smaller classes, particularly in those beginning years. Of course the teacher has to be more resourceful in a larger class. using reading groups and classroom volunteers, including advanced pupils Second, there is evidence that an emphasis on basic skills has been saeriNed, Any individual who has strong skills in language (reading comprehension and writing/speaking skills) and numeracy can develop for themselves an education in whatever trade or occupation which they wish to enter. Third, there is evidence that much of the drive to excel at school comes from the home and family. Economists’ studies have shown that the best predictor of success at school is the number of books in the home when the child is young. Ofcourse, that does not mean that every family ought to run out and buy more books - it is clearly the attitude of the parents towards reading and learning that makes the difference. Teachers will identify here m that many parents view the educational system as day care and that attitude is carried over into the children. It has been shown ttt one study that particularly successful children of immigrant families experienced a daily inquisition at home about what they had learned in school, which in turn gave the sotvdaughter an opportunity to pay attention and also to teach the parents language and other skills of their new homeland. How many parents are more concerned about the academic gomgs on of the school day? Fourth, pupils need to be taught that there are differences in achievement and that there are rewards for achieving success. Currently, too large a portion of our students drops out before completion, The bright pupils are not challenged (they are told that when their work is completed they may do something they Wish to do), and to be kind to the slower pupils in the class, we have repcted competition in awarding grades, report cards, etc. Some pupils learn better using different approaches - i.e. music can be used to teach language skills but not all pupils are turned on by music. Similarly, not all pupils learn from rote memorization “School choice" is not available in Canada except in very few instances and yet that would make it easier to enhance learning. For those into "empowerment" of pupils, there is some evidence that where teachers and pupils set goals together, including administrative goals, the learning in enhanced. iGGGrcy "iireGixrwerriie U at Vmake for u are museum leaning environment. ...__..-.‘ (Won m 21) GGiGiiG nr {Sam 5 Technology 'ryiartgU (Kitchener. Waterloo, Cambridge and Gulph). there'safeeling0feautiousogrtimismuadirtgirtto J. Alex Murray, author of the 26-page survey. any: overthepeuyeueompenieehnveeeenenimprove» mrntiniuirhnastdafpiet-datr-dtttttte, paateouput-tttefinaneiatpieturotrtnanyot those surveyed has picked up. "That new paw who on now employed can lower their on»: level a little," Murray Mid. “Companie- ete saying that the outlook is good. It looks like we’ll be able to hold steady and people who on now employed can hold on to their jobs because with the pick up in the American economy, the drop in the Canadian dollar and with the However, there seems to be very little light at the end of the employment tunnel for those still searching for a job. Until the economy sees a real sustained level of growth, companies may just continue with the staff they already have, pay a little overtime and hire mum people to fill in the gape before hiring full-time again. W'rnuo the way they are, we'll be ,able to "is/not like 1982,Uere alter you saw the cycle go down you saw employment rise. Then you saw the cycle pick up you saw a lot of employment pick up., - _ _ . "What you're going see here is we're going to have townit until mid you. or longer, until the mined growth is there, investment is being made and then we're going to in“ in people." However, " companies try to stay competitive in the global market, those who will be hired must be what Murray calls, "valueodded people". "We have to have a product that is quality driven and it's a product that has to be competitive price. General comments on the regional economy for 1993 were mixed, with the majority of firms expecting more of the same in the new year. The remaining responses were virtually split when predicting whether they would be better or worse off next year. Business executives who were optimistic stated that the regional economy has turned the corner and will move ahead at a slow pace. However, any improvement in the economy is not expected to be substantial. and respondents of the survey still feel that further pain, particularly closing of small local plants, will be experienced in the coming year. The intergovernmental quarrelling between the provinces and Ottawa is seen as a major stumbling block to rapid improvement. The high debt and derteit positions of both the provincial and federal governments, as well as high taxation, were also cited as problems by rtrrng in Canada's Technology Triangle. These rtrtttq feel that the federal govern- ment must focus its Wort, on economic improve ment and the development of an economic plan for the country. Several of the provincial grtvertuttent'tr policies, particularly the new labor legislation, were seen as a further hinderance. Survey results from the three size groupings of CIT companies - small, under " million; medium, " to $16 million; large $16 million and over - are as {011th BMW Business representatives from small companies - to be more optimistic regarding the unemployment situation in the coming year. One quarter of these {inns expect lees unemployment, compared to 22 per cent and 18 per cent for medium and large firms, respecting Overall. have“. little change is expected companies. rendle- of as - ' C1rNhmtmatrr TIMING. Medium-sine firm. ap- peartoberttorrragesiveatrthervietrmmat! being a good time for investing in plant and equipment. Forty eight per cent of executives from thuimediunra'uertrmtsrtselmtwiaagoodtitneto invest, compared to 40 per cent and " per cent for large and small rmna, respectively. The ability of large and medium flnng to “weather the storm" is a likely cause for their more positive outlook. DFHVANCIAL PERFORMANCE. A greater num- ber, 42 per cent, of large companies reported being better off than they were last year, compared to 37 per cent of medium and 23 percent of small firms. Large companies also had the largest percentage, 37 per cent, who were worse off than the previous year. This stratirteatiott of results is a sign of the continued weakness of the economy. DFINANCIAL EXPECTATIONS Urge compa-‘ nies are more optimistic about the coming year with 60percentexpectingtobebecteroffnextyear compared to 38 per cent of small rmng. Overall, the three size groupings are being relatively optimistic, although 16.5 per cent of small, and five per cent of large companies Jas',, be worse off next year. DCAPACITY HON. It appears that smaller companies are beginning to respond to the . slow economic recovery more quickly than the larger-lined firms as they exporienged ttt capaci- ty utilization over the past ya: with 32 cent at or about capacity. Capacity is still undorutiliud with67percantotmnll,84paecntofmodiumand a1moat77pertmttoflargeenettpanlightlror substantially below capacity. ttigrtigiesnt improve tmmttnustbetnadetiaubatarstialetmsoettie gairuwillitefett,pytiqtiarlrrrithr-tto Increased employmoni levels. Economist J. ALEX MURRAY