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Wendy Cunningham & Laura Sanchez Puerta Skills & Employability for the 21 st Century Workshop World Bank June 8, 2009
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Assist clients to improve Employability: a person’s ability to get and keep a job (employment or entrepreneurship) Efficiency in job matches: workers find high quality jobs conditional on internal and external factors Two questions What are the constraints (to employability/ efficiency)? What are the interventions to address these constraints?
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Take as given Macroenvironment Investment Climate Labor Regulation Formal Education System Focus on programs/interventions Methodology: evolving constraints-incentives framework, applied in LAC and Africa
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Has in mind a job & wage he is willing to accept Has a set of skills Has in mind a set of skills she needs Has in mind a wage, she is willing to offer 4
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Has in mind a job & wage he is willing to accept Has a set of skills Has in mind a set of skills she needs Has in mind a wage, she is willing to offer 5
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Propose 5 categories of constraints to market clearing
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Is the missing factor Technical skills General skills Life skills Caribbean: Employers’ assessment of most desired skill set Source: Blom and Hobbs( 2007) ConstraintsIntervention
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Is the missing factor Technical skills General skills Life skills Demand-driven, comprehensive voctec+life skills+internship training programs Information on returns to skill investments 2 nd chance education programs Caribbean: Employers’ assessment of most desired skill set Source: Blom and Hobbs( 2007) ConstraintsIntervention
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Many workers use informal mechanisms to find jobs (Peru) Source: Cunningham et. al. 2008. ConstraintsIntervention
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More importantly (?) many employers use informal employee search mechanisms (Sierra Leone) Source: Peeters, et. al. 2009 ConstraintIntervention
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More importantly (?) many employers use informal employee search mechanisms (Sierra Leone) Employment offices with social workers (for both clients) Web-based job information boards Source: Peeters, et. al. 2009 ConstraintsIntervention
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It is costly to hire workers (because it is costly to fire them) Few good ways to signal skills School certificate Held a previous job ConstraintsIntervention
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It is costly to hire workers (because it is costly to fire them) Few good ways to signal skills School certificate Held a previous job Skills certification/ Skills Qualifications Framework Training center accreditation ConstraintsIntervention
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Constraints to starting a business? Financial capital Social capital Human capital ConstraintsIntervention
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Constraints to starting a business? Financial capital Social capital Human capital Micro-finance Entrepreneurship mentoring Entrepreneurship training Bundled? ConstraintsIntervention Share of each age group in each sector, 1 st quintile (Brazil) Source: Cunningham, et. al. 2008
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No growth/restrictive labor legislation Too costly to hire ConstraintsIntervention
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No growth/restrictive labor legislation Too costly to hire Public works/service + training (SR) Wage subsidy for low productivity workers ConstraintsIntervention
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ConstraintALMP with some evidence Technical, General, Life skills mismatch Job training+, life skills, information about returns to skill investments Poor matchingEmployment offices Poor signalingSkills certification, training program accreditation Lack of entrepreneurial capital (skills, social, $) Mentoring, entrep training, micro-finance Insufficient labor demandPublic works/service, wage subsidies 18
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We can conclude Many different constraints may interrupt the job match process Probably more than one constraint at play in any country/for any target group … what are they? We have some ideas about interventions Moving forward Develop diagnostic tools & identify the constraints that are most important in specific contexts Continue to build the knowledge base of effective interventions
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When applying the framework to your region Are there constraints that we missed? Is there diagnostic literature that we missed? Are there interventions that we should be aware of? Wendy: Wcunningham@worldbank.orgWcunningham@worldbank.org Laura: Msanchezpuerta@worldbank.orgMsanchezpuerta@worldbank.org
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Betcherman, Gordon, Martin Godfrey, Susana Puerto, Friederike Rother, and Antoneta Stavreska “A Review of Interventions to Support Young Workers: Findings of the Youth Employment Inventory” SP Discussion Paper #715 (World Bank) Blom and Hobbs( 2007) School and Work in the Eastern Caribbean: Does the Education System Adequately Prepare Youth for the Global Economy? (World Bank: Washington, DC) Cunningham, Wendy, Lorena Cohan, Sophie Naudeau, and Linda McGinnis. 2008. Supporting Youth at-Risk: A Policy Toolkit for Middle-Income Countries (World Bank) Cunningham, Wendy, Linda McGinnis, Rodrigo Garcia-Verdu, Cornelia Tesliuc, and Dorte Verner (2008) Youth at-Risk in Latin America and the Caribbean: Understand the Causes, Realizing the Potential (World Bank: Washington, DC). Peeters, Pia, Wendy Cunningham, Arvil van Adams, and Gayatri Acharya (2009) Youth Employment in Sierra Leone: Sustainable Livelihood Opportunities in a Post-Conflict Setting (World Bank: Washington, DC) Puerto, Olga (2007). “Learning from International Experience: The Youth Employment Inventory” (World Bank: Washington, DC) Sanchez Puerta, Laura. 2008. “Managing Labor Market Risks and Creating Better Jobs: Alternative Designs for Income Protection and Active Labor Market Policies” (manuscript) Katz, Elizabeth. 2008. “Programs Promoting Young Women’s Employment: What Works?” http://siteresources.worldbank.org/INTGENDER/Resources/GenderYouthEmploymentKatz.pdf
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