Key policy issues

Policy issue 1: System capacity is not aligned with demographic decline, fiscal reality and labour market needs

As well as their implications for economic development and the sustainability of social security systems, demographic trends naturally have an impact on education and training, including tertiary education. The impact of demographic changes on enrolment in education tends to become an issue at times of marked increases or decreases in the relevant age cohort (oECD, 2008a). increased participation rates across the Eu in the last decade have masked the impact of declining younger age cohorts on tertiary education institutions as student numbers have continued to increase. Current projections show a significant decline in the typical age cohort for tertiary education students (20-24 years) over the next 40 years in a majority of Eu member states (Kwiek, 2013).

Latvia is at the forefront of this development, as the natural decline in its potential student body has been aggravated by two decades of emigration. Latvia therefore faces a major challenge in aligning the overall capacity of its tertiary education system - institutions, study programmes and human resources - with demographic decline, fiscal reality and the changing demands of the labour market.

Latvia should continue its various initiatives to rationalise institutions and study programmes including through consolidation and promoting collaboration. It should carefully monitor the progress of these efforts. In case progress is too slow and/or insufficient to achieve the systemic realignment of the system’s capacity Latvia could consider developing a national framework for the future size and shape of its tertiary education system to provide high-level guidance for further rationalisation of the system.