What are the direct costs? What are the indirect costs? Who pays for the training? Do the costs differ by industry? Over what period of time are the costs calculated? Are intangible costs measurable? How can we measure intangible costs? Can or should intangible costs be converted into monetary value? Training benefits Benefits are defined in various ways, arise at different points in time and are sometimes difficult to quantify (OECD, 2008). There are two categories of benefits – market and non-market. In the workplace, for example, these refer to job related and non-job related outcomes. Table 5 illustrates some of these benefits for individuals, organisations and the economy. Market benefits are directly measurable and relative to the stakeholder group. The main benefit of TVET that influences pre-tax earnings of individuals is improved employability (Long and Shah, 2008) and for the economy increased participation in the workforce. Non-market benefits are not so easily quantifiable. Employee social and well-being aspects or business workplace literacy, safety and workforce flexibility are more difficult to measure. Outcome measures tend to have an economic focus, excluding community and personal outcomes that are more difficult to quantify (OECD 2008). A model that takes both market and non-market benefits is recommended (CEDEFOP, 2013). Table 5 Benefits of TVET training by stakeholder Individuals Employer Economy Job related Market Tangible benefits Higher employability Productivity Higher employability Employment Sales & profitability Increased participation in the workforce Higher salaries Customer service and satisfaction. Decrease in unemployment levels Higher savings levels Occupational health & safety Productivity gains Improved working conditions Quality product & services Higher skilled workforce Professional mobility Saving on material & capital costs. Productivity (highly skilled) Non-job related Non-market Intangible benefits Higher education pathway Motivated workforce Improved health Pathway to further study Improved organisational climate and Improved environment culture. Improved self esteem Reduced national crime Increased literacy in workplace Communication skills Increased social cohesion Employee skill gains Engagement Increased social inclusion Employee well-being Improved problem solving Strengthened social capital Employee workplace practices Improved health & wellbeing Active citizenship Improved economic standards of living Technological change adaptation
What are the direct costs? What are the indirect costs? Who pays for the training? Do the costs differ by industry? Over what period of time are the costs calculated? Are intangible costs measurable? How can we measure intangible costs? Can or should intangible costs be converted into monetary value? Training benefits Benefits are defined in various ways, arise at different points in time and are sometimes difficult to quantify (OECD, 2008). There are two categories of benefits – market and non-market. In the workplace, for example, these refer to job related and non-job related outcomes. Table 5 illustrates some of these benefits for individuals, organisations and the economy. Market benefits are directly measurable and relative to the stakeholder group. The main benefit of TVET that influences pre-tax earnings of individuals is improved employability (Long and Shah, 2008) and for the economy increased participation in the workforce. Non-market benefits are not so easily quantifiable. Employee social and well-being aspects or business workplace literacy, safety and workforce flexibility are more difficult to measure. Outcome measures tend to have an economic focus, excluding community and personal outcomes that are more difficult to quantify (OECD 2008). A model that takes both market and non-market benefits is recommended (CEDEFOP, 2013). Table 5 Benefits of TVET training by stakeholder Individuals Employer Economy Job related Higher employability Employment Higher salaries Higher savings levels Improved working conditions Professional mobility Productivity (highly skilled) Market Productivity Sales & profitability Customer service and satisfaction. Occupational health & safety Quality product & services Saving on material & capital costs. Tangible benefits Higher employability Increased participation in the workforce Decrease in unemployment levels Productivity gains Higher skilled workforce Non-job related Higher education pathway Pathway to further study Improved self esteem Communication skills Engagement Improved problem solving Improved health & wellbeing Improved economic standards of living Non-market Motivated workforce Improved organisational climate and culture. Increased literacy in workplace Employee skill gains Employee well-being Employee workplace practices Intangible benefits Improved health Improved environment Reduced national crime Increased social cohesion Increased social inclusion Strengthened social capital Active citizenship Technological change adaptation
Evaluation-framework-measuring-ROI-in-TVET.docx