Private-led policy transfer: the adoption of sector skills councils in Chile

ABSTRACT

This study investigates the adoption process of a TVET policy, usually driven by the state, by private actors. Considering a Cultural Political Economy analytical approach, we use the adoption of Sector Skills Councils in three Chilean sectors (mining, wine, maintenance) to examine the different factors that explain the process. We draw on interviews with key informants at the sectoral and national levels, sectoral documents, and press articles. Our analysis shows that the framing actions of a local policy entrepreneur and their interaction with neoliberal political-economic institutions were key to explaining the policy’s attractiveness for private actors. Furthermore, economic and organisational conditions at the sectoral level explain why these three sectors adopted SSCs. We offer further insights about the TVET policy transfer process from the perspective of local and sectoral actors, and in particular, the role of non-state actors.

KEYWORDS:

• Policy adoption
• TVET
• sector skills councils
• employers
• Chile

Introduction

Technical and Vocational Education and Training (TVET) has attracted renewed interest in international policy agendas (McGrath 2012; Gonon and Maurer 2014). Economic crises and the need to better support young people transitioning from education to work have placed further attention on developing labour market-oriented skills through TVET (Valiente, Zancajo, and Jacovkis 2020). This situation has fostered a toolkit of TVET policies promoted by consultants and international agencies that have travelled worldwide (McGrath 2012). Among these policies, the adoption of sectoral governance reforms intended to make TVET more relevant and responsive to employer needs is notable (Raddon and Sung 2006; McGrath 2012). The creation of formally institutionalised bodies, such as Sector Skills Councils (SSCs), is one such policy that seeks to involve employers in skills policy (Raddon and Sung 2006; Sung 2008). The main objective of SSCs is to ensure education, training and skills meet the needs of employers in a specific sector, especially in Anglo-Saxon liberal market economies (e.g. the UK and Australia) where they originated (Kraak 2013; Moon, Ryu, and Park 2021). To achieve this objective, SSCs are particularly focused on developing information about current and future skills needs, and work with relevant stakeholders to address these needs (Lempinen 2013; Wilson, Tarjáni, and Rihova 2016). Even in liberal market economies SSCs have been mainly promoted by state actors. They are expected to contribute to ensuring labour market relevance of the skills developed by the TVET system and, thus, to help solve social and economic issues such as youth unemployment and skills shortages (Raddon and Sung 2006; Lempinen 2013).

This study examines why and how SSCs have been adopted in three different sectors in Chile, with the policy borrowed from other countries. In answering why SSCs were the selected policy response, this case presents an attractive opportunity to study SSCs and policy adoption for at least two reasons. Most prominently, Chile provides an interesting contextual puzzle, as these sectoral bodies have been adopted by private actors, such as business associations, with no intervention or incentives from the state. This presents a critical difference with SSC policy adoption in their countries of origin and in earlier adopters. Given Chile’s extreme neo-liberal orientation and lack of coordinating institutions in the labour market, the political, economic and educational reasons that might explain this ‘unusual’ adoption could illuminate how future policy adoption in weakly institutionalised states may occur.

Furthermore, there is no information more generally about how these bodies have been adopted in Latin American countries. Most of what is known about sectoral or industrial bodies for skills development comes from Anglo-Saxon countries and, to a lesser extent mainland Europe, and South Africa (e.g. Raddon and Sung 2006; Powell 2016; Kraak 2019).

This qualitative research draws upon a Cultural Political Economy (CPE) (Jessop 2010) analytical framework, which considers ideational and material factors in explaining why particular policies are selected over others within specific contexts. Given the lack of coordinating institutional factors, such factors might be key to understand the policy adoption reasons and process. This fills a wider empirical gap as, in recent years, an increasing number of nations have been adopting SSCs with the support of International Organisations (IOs) such as the International Labour Organisation (ILO) and the European Training Foundation (ETF) (c.f. ETF 2015). However, the literature on TVET policies and skill formation has given little attention to why and how SSCs have been adopted in different places (Kraak 2013; Petersen et al. 2016). On one side, the scarce literature on SSCs has focused on studying their outcomes in terms of employer engagement (e.g. Payne 2008; Sung 2008, 2010) and/or organisational types and functions (e.g. Raddon and Sung 2006; Petersen et al. 2016; Kraak 2019). On the other side, the literature on TVET policy transfer has focused on studying policies such as qualifications frameworks and highly institutionalised dual apprenticeships (e.g. the German model) (Li and Pilz 2021). There is little knowledge about how Sector Skills Councils have been adopted from the perspective of policy transfer.

The study focuses on three cases of Chilean business associations adopting SSCs. The analysis is based on semi-structured interviews with sectoral and national actors, sectoral documents and press articles. The findings show that the adoption of SSCs resulted from the combination of the persuasion strategies of a local policy entrepreneur, the neo-liberal educational and political conditions at the national level, and the economic and organisational circumstances at the sectoral level. Before the methodology, analysis and discussion, the paper begins with a review of how policy transfer and adoption may be theorised.

Theories to explain TVET policy adoption

Interest in understanding education policy change has accentuated during the last decades as it has been argued that globalisation has fostered a convergence of education policies across the globe (Perry and Tor 2008; Mundy et al. 2016). This convergence has led us to talk about Global Education Policies (GEP) (e.g. Ball 2012; Steiner-Khamsi 2016; Mundy et al. 2016) when referring, for instance, to the promotion and adoption of public-private partnerships in different settings.

There might be different reasons that explain why and how policymakers in different contexts adopt new education policies. For example, an important distinction refers to whether a policy is adopted due to imposition or as a voluntary action (Perry and Tor 2008). Imposition happens when – mainly low-income – countries adopt specific education policies to comply with the conditions required to obtain financial aid (Steiner-Khamsi 2010; Crossley 2019). Here then, globalisation may be an excuse for powerful international actors proliferating neoliberal hegemony. Voluntary action refers to local policymakers deciding to deliberately adopt education policies from elsewhere, which has been termed as policy borrowing (Phillips and Ochs 2004). This term captures the decisive role of local actors in deciding to engage with GEP (Mundy et al. 2016), as is the case in this study.

In some cases, policies are borrowed by local actors as a strategy to validate the adoption of policies that otherwise would be locally rejected (Steiner-Khamsi 2014). Moreover, policymakers borrow education policies nearest to their particular agendas, using cross-national policy borrowing to obtain a certification effect in local discussions (Steiner-Khamsi 2014, 2016). In this sense, several authors have emphasised that policy borrowing studies need to carefully consider the contextual conditions where policies are adopted and local actors’ interests (e.g. Phillips and Ochs 2003; Rappleye 2006; Crossley 2010).

In addition to local actors, the role of IOs in the diffusion (and convergence) of education policies has been emphasised (Verger 2014). For instance, pointing out the influence of the Organisation for Economic Cooperation and Development (OECD) and the World Bank (WB) on GEP (Mundy et al. 2016). Moreover, the role of private actors such as think tanks and consulting companies acting as ‘policy entrepreneurs’ have also been recognised as key actors in policy change (Ball 2012; Olmedo and Grau 2013). In both cases, persuasion dynamics, discursive selectivity and generation of meaning partly explain policy change (Verger 2014).

Specifically, in the case of TVET policies, IOs have played an important role in policy transfer, with organisations such as the OECD, the ILO and the ETF influencing global discourses and supporting the implementation of policies (Gonon and Maurer 2014). Also, cooperation and donor agencies, such as the World Bank, have played a key role in promoting and supporting the adoption of specific TVET policies. Some TVET policies’ adoption could be explained by these agencies’ hegemonic preferences and interests. Likewise, in the case of national donor agencies, the policies advocated tend to reflect their national TVET models (Gonon and Maurer 2014; Li and Pilz 2021). One good example is the German Ministry for Economic Cooperation and Development (BMZ) which has focused on developing actions to promote the key characteristics of the country’s dual system of vocational education (Stockmann 2014). Most studies on comparative TVET transfer have focused on the development of cooperative actions and the perspective of donor agencies (Li and Pilz 2021), while work examining local actors at the sectoral level, in-depth, is rarer.

From a different perspective, the institutional political economy literature on skills has focused on studying internal factors that can explain why countries have different approaches to skill formation (e.g. Thelen 2004; Busemeyer and Trampusch 2012). From this perspective, the adoption of TVET policies can be understood by studying the relationships between relevant actors, such as the state and firms, and the predominant characteristics of the institutions within a country. These authors are more sceptical about the limits of the global convergence of education policies, particularly for TVET. For instance, Busemeyer and Vossiek (2016) suggest that the prevailing institutions within a country create feedback mechanisms and path dependencies that make it difficult to fully implement policies ‘borrowed’ from elsewhere.

Recent studies on education policies, and TVET in particular, have also considered the influence of institutions on the adoption of skills policies but, at the same time, have examined how these interact with ideational factors generated by various actors (e.g. Verger, Fontdevila, and Zancajo 2016; Zancajo and Valiente 2018; Valiente, Lowden, and Capsada-Munsech 2020). Drawing from a Cultural Political Economy (CPE) (Jessop 2010) analytical approach, these studies have identified the main drivers for the policies studied and the governance technologies involved in the process of policy change. Accordingly, these studies have illustrated how education and TVET policies at the national level are affected by the interaction between political, economic and institutional conditions, global discourses and local sentiments and paradigms.

In summary, within the policy transfer literature, scholars have emphasised different perspectives to understand why and how local actors adopt specific policies from elsewhere. It has been argued that examining the role of external influences and actors can help explain policy transfer, both imposed or voluntary. In the latter, the literature on policy borrowing suggests that local actors’ actions can be understood by examining their preferences, interests, and contextual conditions. The CPE approach is an ideal way of synthesising these concerns. In the case of TVET, some studies have considered this perspective to understand TVET policy changes at the national level. This article builds upon these to understand policy adoption at the sectoral level, which is largely missing. Thus, we add an exploration of (a) how the interaction between different factors translates to policy adoption at the sectoral level, (b) possible differences between sectors in a common national context, and (c) what may explain these processes and differences. The following section further explains the CPE approach as an analytical framework.

CPE as an analytical framework for policy adoption analysis

Cultural Political Economy (CPE) is an approach concerned with the interdependence and co-evolution of semiotic and extra-semiotic (i.e. material) aspects to understand social change (Jessop 2010). It is rooted in an understanding of semiosis or meaning-making as an existential necessity of social actors to reduce complexity for understanding the world. Likewise, it recognises the operation of structural aspects in this process. In this line, the CPE approach allows us to analyse how the interaction between ideas (semiotic) and economic, political and institutional (material) drivers influence processes of policy change (Zancajo and Valiente 2018).

For CPE, these ideational and material drivers interact in social change processes through the evolutionary mechanisms of variation (of ideas), selection (of particular ideas from various options) and retention (of the selected solutions) (Jessop 2010). The variation mechanisms emerge when a policy domain begins to be questioned due to specific circumstances such as new challenges or crisis. Selection mechanisms involve the preference for particular discourses to explain a problem’s causes and the possible solutions to address it. Finally, the retention mechanisms entail the institutionalisation of the selected policy option, or programme theory, by including changes, for instance, in regulatory frameworks (Jessop 2010; Verger, Fontdevila, and Zancajo 2017). Thus, as an analytical approach, CPE leads us to examine how these different sets of factors interact in SSCs policy adoption process.

Research methods and data analysis

This study followed a qualitative case study approach, focusing on the Chilean mining, wine and maintenance sectors. The cases were selected because they were the only sectors where SSCs remain to date, and access to relevant informants was possible. One additional case of failed adoption was initially considered for this research, but access to data was unfeasible. This limited our possibilities to better understand what factors could be essential for SSCs’ adoption. Still, comparing positive adoption cases sheds some light on the factors involved in adopting these bodies and potential explanations of differences among cases. The three SSCs studied are different in organisational structure, funding and members’ configuration, reflecting the different economic and political power of their sectors and the main actors involved in their adoption. For instance, while mining accounts for 10% of Chile’s national GDP (Consejo Minero 2018), wine accounts for 0,5% (VDC 2018), which also impacts the political power of these sectors in national discussions. Also, the mining and wine SSCs represent single sectors of the economy and have been established by their corresponding sectoral business associations, the Consejo Minero (CM) and Wines of Chile (WoC). Differently, the maintenance skills council is a multi-sectoral body adopted by an influential national business association (the CPC) that represents six sectoral business associations. Thus, this SSC is comprised of representatives from different business associations, among other types of actors (FCh 2018).

The study was conducted in three stages. First, a review of sectoral documents and press articles from the business associations websites and specialised sectoral media. Most documents are publicly available, and four from the wine sector were requested from a SSCs’ representative. They comprise SSCs’ labour market intelligence (LMI) studies and different business associations’ reports related to skills development for the sector. Press articles covering news related to the SSCs were searched online and covered a period between Dec-2010 and Feb-2020. This stage allowed the identification of key interviewees and the construction of a timeline of events for each sector, that facilitated understanding of policy adoption processes.

Primary data was gathered between April and June 2019 through semi-structured interviews with 17 sectoral actors involved in the SSCs’ adoption and a further 13 national actors (see Table 1). The number of interviews by sector reflects their different economic and political power, as detailed above. Particularly in the case of the wine sector, internal documents from the business association were obtained to overcome the lower number of interviews compared to the other sectors. Also, interviews with national actors were conducted to understand the relationship of the SSCs with the public sector, triangulate information from the sectors with fewer interviewees and understand the national contextual conditions at the time of adoption. Among these actors were policymakers working at national agencies within the Ministries of Education, Work and Economy. Table 1 summarises the number of interviews, documents and press articles considered in analysing each sector.

Table 1. Data collection: interviews, documents and press articles.

Sector	Interviews	Documents	Press articles
Mining sector	9	3	27
Wine sector	2	5	32
Maintenance sector	6	6	18
National level	13	-	-
Total	30	14	77

Interviews were fully transcribed and analysed thematically according to three main dimensions of the CPE framework: (1) problematisation of the challenges the policy attempted to address (variation); (2) motivations and reasons for the selection of SSCs as a response to these challenges; (3) the contextual factors needed to retain the policy. A further analysis of all sectoral documents was conducted according to these three dimensions. Thus, the analysis of interviews and documents allowed to identify the material and ideational factors that explained the adoption of SSCs for each sector. Next, a comparative cross-sector analysis of these factors was conducted to understand their interplay and sector-specific contingencies. The following section presents the findings of this study.

Findings

The key role of a local policy entrepreneur and the context for framing action

This section explains how skill formation was problematised in the three sectors, identifying three common material factors and three ideational factors. First, the three sectors were affected by economic challenges that had a direct relation to labour shortages and/or skills deficits. The rapid growth of the mining sector ̶ triggered particularly by the surge in the copper price ̶ resulted in an increased demand for appropriately skilled people, especially for mid-level operation and maintenance technicians. This demand surge generated a ‘war for people’ among mining companies, increasing recruitment, training and labour costs. In wine, the industry’s plans for international growth, combined with a declining rural labour force, caused recruitment issues. In maintenance, decreased productivity levels observed across the Chilean economy were seen to necessitate an upskilling of their labour force.

In all sectors, internal business association actors with interest in human capital matters began to perceive human capital issues as threatening their sectors’ growth expectations, mainly because of the disconnect between industry and TVET. However, this awareness and understanding of the problem were generated because of the direct or indirect influence of an external actor, the Fundación Chile (FCh). This public-private organisation (Chilean state and BHP Billiton) provides consultancy and technical services for different industries and sectors (Huss 1991; MINMINERIA 2021).

The idea of SSCs was first introduced to mining, which was then used as an example for the other sectors. The process started in 2010 when FCh identified that economic challenges affecting the sector could serve as an opportunity to convince mining employers to adopt coordinated action to influence skill formation. FCh used framing and mobilisation strategies commonly recognised in the education policy literature, such as crisis rhetoric, compelling evidence and organising public events to introduce the problem and solution (Auld and Morris 2016; Ball and Exley 2010). The following quote from one top-level mining executive refers to one such event:

That seminar was very interesting because we all presented a very complex outlook in terms of numbers [of demand for people]. I remember there were two peaks, one in 2014 and the other in 2018/2019 in which clearly there was not, it was not going to be enough [skilled workers], and there we were three years before, three, four years before looking at that future that … for which we were not prepared at all! [Mining Skills Council stakeholder 1]

The problem was framed as a mismatch between the supply and demand of skilled workers at the sectoral level. FCh’s ability to emphasise the problem as a threat to the sector’s competitiveness was key to speak to private actors in a language that resonated with their interests. Simultaneously, FCh showed the case of sectoral coordination among Australian mining employers to illustrate a possible solution, which served as an example of coordination to solve skill formation issues in a similar institutional and economic setting. This is because the institutional conditions of Chile’s market model of skill formation (Valiente, Zancajo, and Jacovkis 2020) were conceived close to the features of Anglo-Saxon liberal market skill regimes, where sector skills bodies were first developed (Kraak 2013; Sung and Ashton 2015). As such, theoretically borrowable aspects of these external systems (Phillips and Ochs 2003) were considered more compatible with Chile than others that emerged in coordinated market economies. For instance, the alternative of the highly coordinated Germanic dual apprenticeship system was deemed unsuitable because the regulatory and incentives structures of the Chilean education system were not supportive of dual models. Also, employers were reluctant to receive apprentices:

It was a significant [skills] gap that appears to be approaching, so we thought that a model as the Australian, that went through the same [problem], could be more efficient. The problem with dual models is that it requires that the student is studying and, in the middle of his/her studies, undertake some kind of extended internship in a company […], but it was seen that there was no disposition within companies to receive these people under that model. [Mining Skills Council stakeholder 2]

Internal actors within the other sectors then used the example of the mining sector to problematise skill formation as negatively affecting their sectors. Although the challenges and skills issues were different in each sector, the employers were all exposed to the same national circumstances concerning the TVET system. This served as a contextual condition for the idea of skills mismatches as a generalised problem. As such, the main problem that SSCs were supposed to solve was the disconnect between employers’ skills needs and the skills delivered by the TVET system:

‘THE WINE SECTOR SKILLS COUNCIL (CCiV), is an initiative led by Wines of Chile that seek to contribute to generate and deliver public goods—studies and labour intelligence information—with the purpose of contributing to close gaps between labour market demand and the formative offer (education and training), in terms of job positions and/or labour competences. In doing so, it follows a functional model that responds to the principles of governance and operation of Skills Councils in developed countries.’ [Wine sector document, VDC and CCiV, 2014, p. 11]

In summary, different economic conditions and the related skills issues affecting the three sectors acted as a base for the FCh’s framing strategies to illuminate a problem. This organisation first directly influenced specific actors within the mining sector to consider their need of addressing skill formation, particularly the mismatch between skill demand and supply. This mismatch resonated with actors in the wine and maintenance sectors, who also started to consider it as a generalised issue. The following section explains how private actors selected SSCs as the solution to address this problem.

The power of ideas and the sectoral conditions for adoption

This section explains how SSCs were selected by private actors as a solution to the problems identified above. Selection mechanisms involve the interactions between actors to interpret the causes of the problem and push for alternative policy solutions (Zancajo and Valiente 2018).

SSCs were conceived by their adopters as the best privately led initiative to reduce skills mismatches, as SSCs would provide organised information about employers’ skills demands to TVET providers. Findings from the analysis of interviews and sectoral documents identified four ideational factors interacting with five material conditions that played a key role in the selection of SSCs as a policy response.

First, the focus on informational issues can be explained by a market-logic paradigm among employers, where the causes of the problem were attributed by the actors to ‘market failures’ in the labour and skills formation markets due to information asymmetries. Accordingly, the idea that employers have an informational role in skill formation began to be naturalised by these actors. Likewise, the private-led SSC approach can be explained by the propagated idea that other actors, and particularly the state, are unable to solve the problem. Finally, positive arguments about SSCs benefiting multiple stakeholders were underpinned by a rational view (from an employers’ point of view, at least) that prioritised employability and economic objectives. Notably, the credibility of these ideas is seemingly rooted in the highly marketised TVET system in Chile and the reduced responsibility of the state in education and training, due to the country’s neoliberal orthodoxy.

Moreover, three additional sectoral material conditions explain why these three specific sectors finally adopted these bodies. First, the existence of strong business associations with the power to organise and influence their members. Second, top-level support within each business association, and third, the availability of technical support or knowledge to aid the adoption of SSCs. Simultaneously, it is noted that these sectoral factors also account for the differences among sectors to adopt each skills council. For instance, the three sectors had strong business associations to organise employers. However, these organisations’ different economic and political power at the national level accounts for the differences between SSCs concerning the type of members included in the councils (i.e. only employers, workers, public sector), the funding mechanisms and the feasible operating model. The following paragraphs describe how these factors interacted in the selection mechanisms that resulted in the SSC’s adoption.

In the case of mining, the framing action of FCh was key to interpret the causes of the problem and present SSCs as the valid solution. First, the policy entrepreneur managed to convince a group of mining employers to fund the development of a sectoral LMI study. This study was presented as a technical evidence-based report. However, it was also rich in policy proposals, containing most of the ideas outlined above. The following extract illustrates some of the ideas presented in this document:

‘The large-scale mining is today facing an inflexion point in this issue [high demand of people, lack of qualified labour and rising salaries]. If the current tendencies remain, the graduates from the current education and training system will not be enough to satisfy the demand, which makes vital the proactive—and very fast—action from the main industry actors’ [Mining sector document 1, FCh, 2011, p. 16]

The problem’s cause was attributed to a lack of information, generating a failure of the market mechanisms to coordinate the supply and demand for skills. In this line, it was advised that employers should perform a more active and coordinated informational role in skill formation. This made sense for employers, as the high level of marketisation of TVET in Chile acted as a precondition to suppose that TVET providers would respond to the information about the demands from employers. The following quote illustrates this point:

So that information, that signs that come out of there [SSCs] is fundamental to be taken by the Ministry of Education, for the formative bodies … and to promote it, let’s say, because it is data that is available and besides if it is checked with certain periodicity it allows, see … to give the right signs to the education market, we talk about the education market, and the truth is that some people get frightened … but, but indeed it is. [Mining Skills Council stakeholder 3]

Further actions from FCh included several meetings with mining sector employers and business association executives and the organisation of a technical visit to Australia and New Zealand to understand the operation of sectoral bodies in these countries. The visit included a wide range of actors, among them mining sector executives, representatives from industrial business associations and policymakers within the Ministry of Work. Moreover, a bold move from the FCh was to convince the Ministry of Work to support the SSCs agenda as a public policy, which despite the Ministry’s enthusiasm, and some initial public announcements, failed to succeed given the timing of the proposals, as it was introduced during the last months of that government. This then served as additional evidence of the limited capacity of the state to drive an SSC policy, validating the idea that employers needed to be the policy drivers. Consequently, once top-level executives within the mining business association were convinced to lead the adoption of a skills council, this body was established in September 2012 as an organisation attached to the business association.

A collateral effect of the FCh’s actions to influence the public sector was that the short-lived SSCs’ agenda promoted by the Ministry of Work was heard by actors in other sectors. Specifically, the Human Capital professionals in WoC considered this a good policy solution. Hence, taking the example of the mining sector, this department managed to convince top-level executives within WoC that they should lead the creation of an SSC for the sector. Likewise, it is possible to notice that most of the ideas underpinning this policy’s selection are similar to those considered by mining sector actors. To illustrate:

We [Wines of Chile] felt that it was necessary, or we believe that it was very important that the industry was the one defining the requirements and passing that information to the people responsible for education and training. If the mining industry, agriculture, etc., can provide these guidelines, that information, the investment that is done in training, [and] certification will be more pertinent, and there will be a better use of resources. And the educational organisations will have better … greater clarity regarding, what professions, what occupations [are required by industry] and how to really give opportunities to youths to develop a career. [Wine Skills Council stakeholder 1]

Consequently, WoC selected and invited a wide range of stakeholders to be part of the SSC’s board. During the first meeting, it was decided an LMI study of the sector was needed to provide a firm evidence base and define further actions. WoC hired the services of FCh to conduct this study and subsequently developed a human capital strategy for the sector. The SSC served as a coordination mechanism to strategically guide the informational, training and certification activities of the business association.

Conversely, in the case of the maintenance SSC, the selection mechanisms involved a long process of evaluations and consultation. First, the Human Capital commission within the business association (CPC) conducted a consultation process with employers in different sectors to inquire about past and current initiatives to address skills issues. During this stage, the business association commissioned FCh to systematise this information and develop a report with recommendations to move forward. This report strongly advocated the same ideas previously outlined. It emphasised a stronger role of the private sector to coordinate the development of information, simultaneously highlighting the paucity of the state in this regard:

‘In general, except specific initiatives, there is a lack of capacity for action from the state to promote the use of this information, which is influenced by the absence of an information system unified and periodic that articulates employment and education data.’ [Maintenance sector document 2, Araneda et al., 2017, p. 43]

This initial relationship between the CPC and FCh resulted in a partnership to develop a multisectoral skills council that could act as a national example of how private-led SSCs could contribute to enhancing skill formation. The partnership also included a financial partner, as J.P. Morgan was convinced to fund the initiative as part of their stated corporate philanthropy activities to improve Chile’s human capital. J.P. Morgan publicly emphasised the economic and social benefits of the SSC, underpinned by an assumption of TVET actors’ instrumental rationality in prioritising employability and economic outcomes:

‘Training people to compete in the labour market is an efficient strategy to enhance economic activity. Despite global economic growth, more vulnerable people continue lagging behind. Our objective is that, on one side, the companies can find the talent they need, and on the other, that through good quality formation people can access job positions that allowed them to improve their socioeconomic position’ [JP Morgan President Chile, public speech cited in CPC press release, 20 October 2017]

The Maintenance 4.0 Skills Council was created in June 2018, comprising members from six industrial associations (mining, construction, metal mechanics, manufacture, forestry and energy), industrial equipment companies, two large private tertiary TVET providers, and one representative of the funding organisation J.P Morgan. Also, FCh consultants acted as the SSC’s Technical Secretariat.

In summary, the selection mechanisms involved in the adoption of SSCs were underpinned by the interaction between ideas among the actors involved and the material conditions at the national and sectoral levels. These interactions, some of which were emphasised by FCh to develop credible discursive orientations, led the SSCs’ adopters to consider informational asymmetries as the cause of skills problems in their sectors, with SSCs the best solution to address it. At the same time, sectoral conditions account for the different organisational forms taken by each SSC. The following paragraphs explain how these ideas were retained and began to be institutionalised by different actors.

The ideational power of funding and the need for state support

This section explains how the three SSCs were retained by both private and public actors, but for different reasons and via different technologies. Retention mechanisms involve the institutionalisation of a policy by its inclusion on regulatory frameworks and through codified practices (Jessop 2010).

The analysis of interviews with sectoral actors revealed that the retention of SSCs by private actors could be explained by two emergent material factors and two ideational factors. Materially, the presence of a leader (or group of people) sustaining the initiative has been key to the continued functioning of SSCs, as has the favourable conditions of the national training system, allowing employers some level of influence over public spending on training. Ideationally, the SSCs’ intention to influence or change skill formation policies and public TVET spending decisions has contributed to retention, as has the perception that new sectoral technological challenges require new skills.

In the case of the public sector, the analysis of interviews with national actors has shown that SSCs’ initiatives have been retained by these actors because of the establishment of a new TVET agenda which has been framed in terms of further coordination. Accordingly, the different products developed by these SSCs, such as qualifications frameworks (QFs) and competency profiles, have been considered by different state agencies. Although, these sectors’ economic and political power seems to be accounting for the different retention levels of these bodies among the public sector. The following paragraphs explain how these factors have interacted in the retention of SSCs.

Once each SSC was established, they began by developing information about their skills demands to influence TVET provision and spending. The three SSCs hired FCh’s services for the development of LMI reports, sectoral competency profiles or QFs. The adoption of SSCs represented a relevant source of income for FCh, showing the interest for policy entrepreneurs in driving specific policies that have been identified elsewhere (e.g. Stone 2012; Cohen 2016; Ball and Exley 2010). However, these reports and the quality of the information developed differed considerably due to each sector’s economic resources. In the wine sector, the SSC’s limited economic resources only allowed a modest LMI study compared with those developed by the Mining Skills Council. Despite these differences, all the SSCs used this information to influence public spending on TVET:

I arrived at SENCE [National Service of Training and Employment] when they [Mining Skills Council] have recently updated the Australian training packages to the Chilean context. And well it comes the Fundación Chile, it comes the Mining Skills Council and tells me ‘look this is the solution, what we have to do is that SENCE should allocate funds to train people on skills for the mining sector and we will hire them’. [National level stakeholder 1, Former National Service of Training and Employment (SENCE) representative]

We developed a project through the +Capaz program [SENCE’s training program] that implemented the government […] So, we asked for the possibility to give this [economic] ‘help’ to lads (sic) that are finishing the secondary technical schools to give them a specialisation. [Wine Skills Council stakeholder 1]

So we hope that the resources will be raised alone, because bodies such as SENCE the only thing they need is to have organised where to put the … where to focalise the resources, where to better focalise the resources. [Maintenance 4.0 Skills Council stakeholder 1]

Moreover, each SSC established projects in partnership with state agencies to influence the use of information and standards developed through the SSCs by TVET providers. For instance, the Mining Skills Council established a public-private project to create a network of TVET providers to support the implementation of their QF. The Wine Skills Council developed a project funded by the Ministry of Education involving secondary technical schools to promote the implementation of a wine-growing sub-specialisation. Finally, the Maintenance Skills Council signed an agreement with the SENCE to offer training courses in maintenance subjects financed with public funds.

Also, both the Mining and Maintenance skills councils developed QFs used by the Ministry of Education as a pilot to implement a National TVET QF. This is expected to significantly impact the relevance of TVET qualifications within the labour market. Notably, the distinct strategies carried out by each SSC are indicative of the different economic resources of each sector and the political lobbying power of the business associations. In this sense, despite all the interviewees from the public sector recognising the three SSCs and some initiatives to coordinate with them, there was a shared conception that the Mining Skills Council has had more impact on TVET at different levels. The following quotes illustrate these different levels of coordination:

In the case of the Mining Skills Council, which probably is the most significant, it was tried to align as much as possible their products and their developments to the [state] institutionality. So, the profiles they developed were added to the ChileValora [National Certification System for Labour Competencies] catalogue, they did a qualifications framework that in some way also the state added to the development […] [National level stakeholder 2, Former Ministry of Education representative]

Beyond the Wine Skills Councils, the relationship was with Wines of Chile and the Sectoral Body of Labour Competencies. With them, we achieved that part of the work to identify entry-level profiles for the industry was used to offer training courses from SENCE. [National level stakeholder 1, Former National Service of Training and Employment (SENCE) representative]

ChileValora has the challenge and the commitment to bring all that work [Maintenance Skills Council] to ChileValora. So, we are with a methodological challenge but also strategic of how to create a transversal sectoral body of maintenance attached to ChileValora [National level stakeholder 3, National Certification System for Labour Competencies (ChileValora) representative]

In summary, SSCs have been retained among the private adopters because of the continued presence of internal leaders sustaining the initiative and the intention to influence TVET. At the same time, the favourable conditions of the national training system to allow some level of impact from employers have served to sustain this intention. Moreover, the three SSCs have managed to achieve a level of retention by the public sector, which can be explained by the establishment of a national TVET agenda framed in terms of the need for further coordination. On the other side, the different economic and political conditions of each sector seem to be accounting for the different impact and consideration of the work of these skills councils in TVET policies.

Conclusions: understanding TVET policy adoption by private actors in a liberal market context

This article has explained why and how the adoption of Sector Skills Councils (SSCs) in one national context has resulted from non-state actors’ actions. As a borrowed TVET policy, SSCs have been mobilised and framed by a local policy entrepreneur. This organisation strategically directed its actions to convince private actors to lead these councils’ adoption. Accordingly, this study concurs with previous work highlighting these policy entrepreneur’s critical role in influencing policy change (Béland and Cox 2016; Ball 2012; Baek 2021). Our empirical example clearly shows the influence these actors could attain under certain circumstances to convince private actors to adopt initiatives that are usually state-driven.

We show how selective discourses were used to recontextualise this policy to suit national conditions and the private interests of the policy entrepreneur (i.e. Fundación Chile). The framing of the policy entrepreneur was suitable for the extreme neoliberal context of Chile, as it centred upon market failures and the inability of the state to correct these. These ideational factors convinced employers that private action was needed to lead the initiative. Moreover, as a technical expert organisation, the policy entrepreneur offered their consultancy services to support the adoption and implementation of these bodies, particularly for the mining and maintenance sectors. This exemplifies the kind of interests from this type of actors mentioned in the literature (e.g. Stone 2012; Ball 2012; Cohen 2016). The main difference in SSCs adoption in Chile (private-led) with regards to the typical original model (state-led) shows how a policy originated elsewhere can be partially borrowed. Interestingly, the public discourse from SSCs’ adopters proudly points out the adoption of a policy from developed (Anglo-Saxon) countries. Thus, showing how policy borrowing can also have a discursive function, or what Steiner-Khamsi (2014) identifies as a certification effect of policy borrowing on local policy-talk. The actors did not reflect on whether the market system itself was to blame and whether more coordination was needed in the wider economy, using market rhetoric to (unironically) ideate their coordinating efforts. The coordination evidenced here does, however, remain far removed from the kind displayed in many coordinated market economies, as exemplified by Germany (Pilz and Wiemann 2021). This is because a stronger involvement of employers in skill formation (i.e. through dual training) was not emphasised when adopting SSCs. Instead, these bodies have been considered a coordination strategy mainly to provide organised information from employers to the TVET system (i.e. their skills demands). Still, as other studies have shown (e.g. Vossiek 2019), our research illustrates that cooperation in skill formation can emerge in a liberal market economy.

Our empirical study also shows that the interaction of ideational with material conditions at the sectoral level explains why these three sectors finally adopted these bodies. First, economic challenges motivated employers to consider engaging in skills policies. Second, factors such as the presence of strong business associations, the support from top-level executives within these organisations, and access to technical knowledge were found across all sectors. In short, our analysis shows that even when ideational factors may be strong to convince private actors, material conditions are still needed to achieve the final adoption of a policy like SSCs. Nevertheless, in the absence of the ideational factors, catalysed by the policy entrepreneur, it is unlikely employers would have formulated this response to the material factors. Perhaps, as has been the case in other sectors (i.e. energy, tourism), employers would have relied on the state to lead other similar coordination initiatives to address skills problems. Further studies, including cases of SSCs’ failed adoption, could better understand which factors found in this study could be necessary or sufficient to adopt SSCs as a solution.

Finally, SSCs have been considered as a policy to engage employers in skill formation (Raddon and Sung 2006; Sung 2010) even when the evidence from some Anglo-Saxon countries has shown this is not always the case (e.g. Payne 2008; Sung 2008). Contrary to what some scholars have suggested when studying employer engagement through sectoral bodies (e.g. Sung 2010; Sung and Ashton 2015), this study has illustrated three cases where engaging employers in skill formation policies has not required systemic reforms to regulations and incentives. Thus, our article shows how ideas and framing strategies could have the power to change employers’ perceptions regarding their role in the skill formation system and their possibilities to affect TVET, especially in liberal market economies. Still, ongoing analysis is required to see whether the policy can be sustained without wider supportive institutions.

However, this situation opens some relevant questions about the effects of this type of employer engagement and the consequences for those affected by this policy, particularly TVET providers and youth. This is a relevant issue to examine in TVET policymaking, as private actors such as employers, policy entrepreneurs and global financial institutions, could have short-term interests that do not necessarily align with broader development and social objectives (Raddon and Sung 2006; Ball 2012; Bhanji 2016). The role of JP Morgan is noteworthy. Although their interest was philanthropic (and we have no evidence to the contrary), the case does still raise the potential of global financial interests affecting national labour interests. FCh also profited from the policy they advocated. Our evidence suggests that the SSCs policy was mutually beneficial and advocated in good faith, but potential conflicts of interest could still emerge in such a privately-led model. In this regard, the dynamics between non-state actors in TVET policymaking should be examined with further attention. Particularly when, as Ball (2012) put it, the state’s role ends up ‘residualised’ in the process.

Acknowlegments

We would like to thank the interviewees for the time and information provided for this research and the anonymous reviewers for their valuable comments and suggestions for strengthening this article.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

This work was supported by the Economic and Social Research Council through the project Newton RCUK-CONICYT Governing the educational and labour market trajectories of secondary TVET graduates in Chile [ES/N019229/1]. Paulina Bravo was funded and supported by the Agencia Nacional de Investigación y Desarrollo (ANID) through the Becas Chile Scholarship [DOCTORADO BECAS CHILE/2017 - 72180010].