Labour Market Information (LMI) – Guiding educational and occupational choices

Governments recognise that careers guidance, underpinned by accurate labour market information, can help learners make post-secondary education choices that match their interests, aptitudes and abilities, and lead to rewarding employment. For this reason, they have invested in building linked education/employment information systems and other information resources which are displayed on websites targeted to learners and their families. However, researchers and governments agree that these efforts are often ineffective in informing learners’ decisions – access to information is not sufficient to provide effective support to student choice.

Drawing upon the insights of behavioural economics, this paper examines how learners access and use information, and what this implies for the design of public study and career choice websites that aim to effectively support student choice. The report also takes stock of the career guidance websites in use in the majority of OECD countries, and sets out to provide actionable advice for policy makers to guide the design of effective information policy levers that support student choice.

Good decision-making in educational and occupational choices is critical for individual well-being and a well-functioning labour market. Good decisions mean that individuals end up in careers that are appropriate to their aptitudes and to their interests. Good decisions are also essential if an economy and a labour market are to optimise the use of the human capital available in a country’s population.
We have learned from research in the behavioural sciences, especially behavioural economics, that when young people face complex intertemporal decisions, they introduce bias – present bias (they place more weight on the immediate cost than the future benefit), confirmation bias (they take account of what “people like me” are prone to do and decide in accordance with their preconceptions). And they are inattentive – they do not engage with the complexity of the decision.
This poses challenges to governments. To improve young people’s career decision-making, governments need to provide support for decision-making – through guidance, in schools and post-secondary education, and through the provision of robust information. But the provision of information needs to be structured to reflect the nature of the decision-making process. This means that information, ideally, should be personalised, trustworthy, meaningful to the decision-maker and provided as needed (but no more).
Labour market information is highly relevant for educational choices. We have seen from the review of 34 public study choice and career guidance websites that web-based technologies offer opportunities to tailor and structure labour market information in ways that are appropriate to young people.

Two key findings with relevance for policy makers emerge from our review of study and career choice websites. First, information will only be effective if timely, relevant and structured in ways that reflect the nature of young people’s decision-making processes. Websites, thus, need intelligent design and tools that can assess the stage of decision- making the user is at and then feed information in ways that give the user control, in quantities that reflect the young person’s capacity to use that information.

Second, effective support for decision-making needs to be managed within an integrated system that includes influencers such as parents, teachers, peers and careers guidance professionals. For a website to be effective it needs to be an integral part of a wider support system. A website with sophisticated features – no matter how good – may sit within a system that lacks other necessary supports, while a website that has only modest functionality may be sitting alongside a range of other decision support tools that, collectively, may constitute an effective guidance system.

Website technology creates opportunities for research into the way young people make educational and occupational decisions. It allows for observation of the decision-maker’s behaviour at a granular level. It is an important new line of work that draws on insights from cognitive science and decision theory to examine how choice processes play out in social environments.

The review of websites provides actionable advice for policy makers. Building on the work of Hume and Heal, we recommend the following eight success factors in the design of effective information policy levers:

1. Understand where young people are coming from, their personal characteristics, and their context in the moment that they are accessing the information.
2. Provide trustworthy information that is up to date, impartial and does not push particular paths.
3. Provide information only when relevant and needed.
4. Personalise information that allows young people to picture themselves in a career while taking into account that what makes a career appealing differs from person to person.
5. Give young people agency and control over the decision-making process by explaining concepts and data, and be transparent about how personalisation and customisation of websites work.
6. Break big decisions down into smaller choice sets helps to avoid information overload while avoiding to omit options, which would otherwise limit a person’s choice set.
7. Signpost actions: provide details of what is the next step in the decision-making process, and what are the implications.
8. Help influencers (parents, teachers, career counsellors) give meaningful advice to young people.

Chosen excerpts by Job Market Monitor. Read the whole story @ OECD iLibrary | The role of labour market information in guiding educational and occupational choices