Human capital development is a critical determinant of economic growth, equity, and prosperity, but outcomes in this domain are worryingly low in Lebanon, risking the future of generations of children. Lebanese children lag behind their peers in human capital development—measured according to the World Bank (2020c) Human Capital Index—suggesting that the future productivity of the labor force and the country’s trajectory for equitable growth is at risk (World Bank 2020b). The Human Capital Index indicates that children born in Lebanon today will reach, on average, only 52 percent of their potential productivity when they grow up. This is lower than the average estimates for the Middle East and North Africa (MENA) region (57 percent) and upper-middle-income countries (56 percent). Lebanon’s poor performance on the Human Capital Index is largely attributed to the education outcomes calculated for the index. If actual years of schooling, which average approximately 10.2 years in Lebanon, are adjusted for actual learning, effective years of schooling are 40 percent less—on average, only 6.3 years of actual learning (World Bank 2020b). The most recent school closures were due to the COVID-19 pandemic, with schools being closed over 75 percent of the school year between January 2020 and February 2021.1 This will likely lead to a further and significant decrease in learning: effectively, students are facing a lost year of learning (Azevedo et al. 2021).
Learning and skill development are essential components used to build human capital, but education quality and equity have been declining in Lebanon. The Lebanese education system enrolls nearly 1.25 million students, of which almost 60 percent attend private schools (MEHE 2021). The private school sector receives approximately a 25 percent share of public financing,2 yet it is subject to minimal regulation and quality assurance. The burden of education in Lebanon falls on parents’ shoulders; they pay a combined US$1.5 billion a year, with the Government paying US$1.2 billion a year.3 School completion rates in primary (78 percent) and lower secondary (59 percent) schools are declining (Abdul-Hamid and Yassine 2020). In addition, school completion is highly unequal among economic groups, with only half of 18-year-olds from the lowest economic quantiles completing school. The outof-school rate for primary and secondary school-age children is extremely high (21 percent) (CAS 2020). Since 2012, Lebanon has experienced one of the largest influx of Syrian refugees—more than 356,000 Syrian refugee children enrolled in formal and non-formal education in 2019 (NLG 2019). Latest surveys find 40 percent of primary age and 90 percent of secondary age Syrian refugee children out of school (CAS 2020). In addition to access, quality is an increasing concern in Lebanon. Results from an internationally comparable large-scale assessment (Programme for International Student Assessment, or PISA) show that two-thirds of Lebanese students do not achieve basic literacy, very low according to international standards (OECD 2019). The limited learning achieved in an inefficient and inequitable education sector and recent crises have translated into a mismatch of skills and labor market needs and a spike in unemployment rates. For example, 32 percent of employed youth are engaged in occupations with qualification requirements below their level of education: that is, they are overeducated (CAS 2020). The skills mismatch is directly related to the quality of higher education, a sector that is currently not regulated for quality standards that would ensure that a quality education and the demanded skills are conveyed.
The current socioeconomic crisis, the effect of the COVID-19 health pandemic, and the recent Port of Beirut explosion will likely mean decreased funding available for education— putting even more stress on the sector in the coming years. Government spending on education has long been insufficient, at less than 2 percent of Gross Domestic Product (GDP) in 2020, which is well below the Organisation of Economic Co-operation and Development (OECD) average of 4.4 percent (2016) and among the lowest in the MENA region (EdStats).
Recent macroeconomic factors have put additional strains on the system, such as the increase in teacher salaries to account for inflation, potential tuition fee hikes, and less job security for education administrators and teachers—all factors that limit the quality of education.The Port of Beirut explosion, which occurred a few weeks before the start of the academic year, and on the heels of an already troublesome previous year with extended school closures, added to the challenges that affected institutions and students already faced; it exacerbated resource constraints, because funding will need to be tailored to the emergency reconstruction and rehabilitation phase.
Although more investments in education are urgently needed, change can be brought only through a comprehensive reform agenda that rests on political will and stakeholder commitment. Years of crises, ongoing political and social unrest, and recent events in Lebanon have led to a largely inefficient and inequitable education sector that provides only low levels of learning and skills and a skills mismatch to the job market. This has led to limited human capital development and struggling economic growth. A survey of 231 finance ministry officials, central bank officials, and other economists representing 53 countries, including all G20 nations, on their perspectives on COVID-19 fiscal recovery packages revealed that education is among the best fiscal stimulus expenditures (Hepburn et al. 2020). Not focusing on and investing in education means missing an opportunity for economic growth and shared prosperity. Such a loss risks the future of generations of children. More investments in education are urgently needed in Lebanon, as is a comprehensive reform agenda focused on learning for all and recentering the education sector on students. This report provides a short outline of recommendations for comprehensive education reform.