YOUTH EMPLOYMENT SEMINAR. Meghan Mahoney Policy Manager, J-PAL Global 13 October 2015

Transcription

1 YOUTH EMPLOYMENT SEMINAR Meghan Mahoney Policy Manager, J-PAL Global 13 October 2015

2 OUTLINE Why Focus on Youth? Review of the Evidence General Lessons Job Training Programs Entrepreneurship and Self-employment Summary and Conclusion 2

3 WHY FOCUS ON YOUTH? 3

4 WHY FOCUS ON YOUTH? Image credit: World Economic Forum 4

5 WHY YOUTH? Image credit: World Economic Forum 5

6 THE YOUTH EMPLOYMENT CHALLENGE Reference: World Development Indicators. World Bank

7 YOUTH FACE A MULTITUDE OF BARRIERS Some barriers relate to youth ability to find employment (supply side): Skill gap Information gap Social gap Geographic gap 2000 John Samples, Courtesy of Photoshare 7

8 YOUTH FACE A MULTITUDE OF BARRIERS Some barriers relate to the employer s willingness to hire youth (demand side): Labor market regulations Information gaps Low initial productivity Constraints to firm growth 8

9 WHAT ABOUT SELF-EMPLOYMENT? Starting and running a business is difficult. It requires: Developing a good idea Having the necessary vocational and management skills Accessing capital for start-up and ongoing operations 9

10 POLICY RESPONSES COULD PROVIDE: Supply Side: Job training to develop the right skills Provide information about job opportunities, wages, etc. Employment services to improve matching between job seekers and jobs Support for selfemployment Demand Side: Relaxing labor constraints or creating employment subsidies Information on youth productivity Support in navigating labor regulations and making hiring decision Public works: direct employment by government 10

11 OUTLINE Why Focus on Youth? Review of the Evidence General Lessons Job Training Programs Entrepreneurship and Self-employment Key Takeaways 11

12 WHAT DO WE KNOW? SUPPLY SIDE (PROGRAMS FOR YOUTH): Some programs addressing youth labor supply issues are promising, but vary widely in both intensity and efficacy. Future research should unpack multicomponent programs and include long-term follow-ups. 12

13 WHAT DO WE KNOW? SUPPLY SIDE (PROGRAMS FOR YOUTH): Job training programs have generally had small effects that do not last. They may affect various subgroups differently. Need to disentangle the effects of components. Providing information can be simple and has been effective. Some promising evidence for increasing labor supply mobility, (e.g. transportation subsidies, incentives to migrate during lean seasons, and housing vouchers to relocate). 13

14 WHAT DO WE KNOW? SUPPLY SIDE (PROGRAMS FOR YOUTH): Employment services, particularly counseling programs, have improved participants short-term employment. Those effects can fade over time and may displace non-participants. Self-employment programs can help participants start businesses, but may not necessarily help them sustain those businesses. 14

15 WHAT DO WE KNOW? DEMAND SIDE (PROGRAMS FOR FIRMS): Programs targeting firm labor demand are promising. It will be useful to innovate and evaluate further. 15

16 WHAT DO WE KNOW? DEMAND SIDE (PROGRAMS FOR FIRMS): Providing employers with information on youth can increase their demand for young employees. Labor regulations and hiring are complicated. Supporting firms in navigating these has had large effects, but more youth-specific research is needed. Evaluations of employment subsidies have shown mixed effects for youth. They have helped in the shortrun, but those effects often do not last and may displace others. 16

17 OUR DISCUSSION TODAY The Evidence in Youth deck provides a summary of the literature on helping youth transition into the labor force, grouped in the following eight topics areas. 1. Information and Aspirations 2. Location, Neighborhood, and Mobility 3. Labor Demand for Young People and Contracts 4. Labor Market Training 5. Employment Services 6. Employment Subsidies 7. Public Works Programs 8. Entrepreneurship 17

18 INFORMATION AND ASPIRATIONS 18

19 FRAMING THE ISSUE Matching potential employees with employers presents challenges from both sides of the labor market. Gaps Youth have inadequate job information Where are the jobs What skills are required Youth lack understanding of workplace behavior Firms lack of information about youth productivity Addressed by Helping youth learn about job opportunities Helping youth learn how to do a job Exposing youth to work-place culture Improving access to information about young job seekers for firms 19

20 PROVIDING EMPLOYERS WITH INFORMATION ABOUT YOUTH Prospective employees with prior work experience and higher ratings on Odesk, an online job marketplace, found more work and were better paid. References: Pallais, 2014; Pallais and Sands,

21 PROVIDING YOUTH WITH INFORMATION Making employment opportunities for women more salient and accessible led to increased investment in education and nutrition of girls, as well as delayed marriage and childbearing among women in rural India. What s the impact of spreading awareness about jobs for educated young women in the business process outsourcing (BPO) sector on lifecycle work and family transitions in India? References: Jensen, 2012; J-PAL Policy Briefcase,

22 PROVIDING YOUTH WITH INFORMATION The recruiting services helped women find jobs, but it also increased school enrollment, changed career aspirations, delayed marriage and childbearing. Effect on employment: References: Jensen,

23 PROVIDING YOUTH WITH INFORMATION The recruiting services helped women find jobs, but it also increased school enrollment, changed career aspirations, delayed marriage and childbearing. Effect on aspirations to work: 30% 43% * 30% * 34% * 19% 23% 4.5% 7.4% expect to work before marriage expect to work after marriage, but before having children expect to work when their children are young expect to work after all children are married References: Jensen,

24 PROVIDING YOUTH WITH INFORMATION Providing information on potential employment using other means has also been effective: Offering youth voucher to attend a job fair in the Philippines had a large impact on domestic employment Sending job offers to youth through mobile phones led to a large increase in employment in Peru References: Beam 2014; Dammert et al

25 LESSONS ON INFORMATION AND ASPIRATIONS Information interventions can be simple and help youth and firms: Can increase employers demand for hiring youth Can help youth adjust expectations, prepare for, search for, and, ultimately, secure, jobs Design and implementation details matter Many open questions remain What s the impact of including information with other programs? Need to explore effects in new contexts 25

26 LABOR MARKET TRAINING

27 WHY TRAINING? Cognitive/Hard Skills: Technical Knowledge Management Skills Vocational Skills Non-cognitive/ Soft Skills: Communication Skills Interpersonal Skills Impulse Control Self-awareness Good Job Candidate

28 DO JOB TRAINING PROGRAMS WORK? Does providing youth with skills improve labor market prospects? How do effects differ over the short term and long term? What type of training is most effective? Class room or on-the-job training Cognitive vs. Non-cognitive skills How can we productively engage the private sector? 28

29 OVERALL, JOB TRAINING PROGRAMS HAVE MIXED RESULTS Potentially because training programs vary greatly and evaluations only test interventions as a whole. But, some promising short-term results: In US and Latin America, some improvement in employment, earnings, formality. But, effects faded over time. In developing contexts, large effects on formality. References: Card, et al 2010; Betcherman, et al 2004; Blattman and Ralston 2015; Schochet, et al 2008; Card et al 2011; Ibarraran et al, 2012; Attanasio, et al 2011;.

30 DESIGN DETAILS MATTER On-the-job component seems to be more effective than classroom training alone Private sector providers have been more effective (in the short run) than public sector providers Effects vary by gender References: Ibarraran et al. 2012; Card et al. 2011; Attanasio et al. 2011; World Bank 2013; Hirshleifer et al,

31 APPRENTICESHIPS: DIFFERENT ON-THE-JOB TRAINING The impact of apprenticeships are not well known, ongoing research is assessing their effects. Apprenticeships could provide high-quality training. There are significant challenges: Matching youth to positions is difficult, could lead to sub-optimal matches Dropout and retention always a concern. Ongoing research in Ghana and India examining apprenticeship schemes, including ways to incentivize quality training References: Hardy, et al. Ongoing; Banerjee, et al Ongoing 31

32 HOW IMPORTANT ARE NON-COGNITIVE SKILLS? In Jordan, wage subsidies had short-lived effect, little effect from soft skills training for female community college graduates In Uganda and Liberia, providing girls with vocational and life skills training improved labor outcomes: Raised probability of income generating activity in Uganda. Positive effects on employment and earnings in Liberia. More research is needed to: Disentangle the effects of soft skills training Uncover the critical window References: Ibarrarán et al. 2012; Groh, et al 2012; Bandiera, O. et al 2014; Adoho, et al

33 EXAMPLE: COGNITIVE BEHAVIORAL THERAPY FOR YOUNG MEN IN LIBERIA Group therapy, one-on-one mentoring by peers plus unconditional cash transfer Therapy (with and without cash) reduced likelihood of criminal behavior, improved self-control, self-esteem. Reductions persisted a year later, were larger for therapy + cash group Receiving cash increased investment and business, shortterm profits. Did not persist (perhaps due to theft). Blattman et al,

34 KEY TAKEAWAYS Results of job training mixed: Some positive effects but might not last. Substantive heterogeneity in subgroups (particularly gender). Different components have different effects: On-the-job training thought as more effective than classroom training Private sector programs more effective than public sector programs Room for future research: Apprenticeships and noncognitive skills components are promising. 34

35 ENTREPRENEURSHIP

36 FRAMING THE ISSUE Improving self-employment may be more feasible and more relevant to many youth, but these outlets come with their own unique challenges. Gaps: Youth may lack the skills and knowledge to start, sustain, and grow a business Traditional business lessons and tools may not apply to entrepreneurial or informal models Addressed by: Help to develop business ideas Learn from experience of role models or mentors Adapt entrepreneurship and business training to specific needs

37 STARTING A BUSINESS MAY NOT BE ENOUGH Global research suggests that self-employment programs often help participants start businesses, but not necessarily sustain them. References: McKenzie and Woodruff, 2013

38 EXAMPLE: ENTREPRENEURSHIP TRAINING FOR UNIVERSITY STUDENTS IN TUNISIA Entrepreneurship training + business plan development and mentoring support Increased self-employment, but may be from switching from wage employment Fostered business skills, increased experience, and expanded networks. Participation improved graduates optimism toward the future. Access to credit still a challenge Reference: Premand et al.,

39 ENTREPRENEURSHIP: LESSONS AND OPEN QUESTIONS ü Self-employment training can help participants start businesses, but do not necessarily help them sustain those businesses. ü Emerging promising results when paired with cash grants or other interventions. ü Simple and specific trainings can help improve businesses. ü Entrepreneurship is not a universal solution to unemployment. Identifying and targeting high-potential poor youth for these trainings can be difficult. ü Future research could evaluate targeting mechanisms, unpack multi-component programs, and include longterm follow-ups.

40 OUTLINE Why Focus on Youth? Review of the Evidence General Lessons Job Training Programs Entrepreneurship and Self-employment Summary and Conclusion 40

41 CLOSING: MORE OPEN QUESTIONS Some promising evidence on both supply and demand side Need to consider potential displacement effects Need for more research, particularly into Importance of components How to target high-potential youth 41

42 THANK YOU QUESTIONS? Meghan Mahoney Policy Manager, J-PAL Global 13 October 2015