Work-based cognitive skills and economic performance in Europe

Purpose – The purpose of this paper is to understand further the role played by work-based cognitive skills in the growth dynamics in Europe. Design/methodology/approach – Work-based cognitive skills are studied using a factor analysis on data from the European Work Conditions Survey (Eurofound) referring to work cognitive requirements. This and other measures of education quality and quantity indicators are used to estimate growth regression models for 28 European countries, in order to test for the significance of work-based skills. Findings – The results corroborate the hypothesis that work-based cognitive skills have been a powerful predictor of economic growth over the last decades. Countries where workplaces require and foster advanced cognitive skills tend to exhibit higher economic growth. Research limitations/implications – The Eurofound Survey on work-based skills, a major source of this study, only began in 1990 so is quite recent and covers few countries. Social implications – The results indicate that the mobilisation of the full intellectual potential of workers in their work context is essential to achieve high-economic performances. Boosting workers interactive learning and autonomy should become a key policy and organisational aim. Originality/value – The authors bring a deeper approach to the way human capital is addressed by testing the relevance of work-based cognitive skills on economic performance. Hence the authors build a bridge between economic growth literature, which focuses largely on the role of formal education, and innovation studies where the emphasis is placed on the relevance of learning processes.