51799 September 2009 . Number 10 I VESTI G I YOUTH I THE ME A REGIO : HOW TO OPERATIO ALIZE YOUTH I TERVE TIO S (I) Gloria La Cava, Matteo Morgandi, Iqbal Kaur, Amina North Africa over the 2008-2009 periods, and Semlali 1 particularly impact young women3. Introduction: The objective of this Fast Brief, The Need for a Multi-dimensional Approach: presented in two parts, is to illustrate several Relevant research and experience shows that concrete examples from the MNA, ECA and LAC traditional single-sector policies and interventions regions of youth-focused AAA, investment offer only partial solutions to this challenge. Unless lending, and grant-funded engagements, which can a youth-focused approach across multiple inform the growing work program in the region. As dimensions is established and interventions are highlighted in the policy note Youth ­ An developed with a sizable critical effect at the undervalued Asset: Towards a New Agenda in the community level4, the needed impact will not Middle East and North Africa2 young people are materialize. becoming an increasing priority for MENA countries. If well utilized, the current youth bulge The six case studies included in the brief illustrate represents a demographic gift leading to scalable self-standing interventions in support of investment opportunities as large segments of our youth development through skills development, populations enter their productive peak years. job creation, youth entrepreneurship, integrated However, if investments fail to be made or do not youth friendly spaces, peace building and active reach young people, the youth bulge may well turn citizenship. These case studies have demonstrated into a drain on growth and society. positive results on beneficiaries, measured though impact evaluations; and Programs such as Jóvenes The Arab World's Youth Bulge: Despite all the show that interventions can be brought to scale and efforts to promote growth and significant replicated at regional level, generating sizable investments in education by Arab countries, a large levels of investment lending. segment of Arab youth continues to remain outside of the mainstream of economic and social life. In The current issue will illustrate examples from the 2006, the Middle East and North Africa already LAC and ECA Regions, while part two will present exhibited the highest youth unemployment rate in case studies from MNA. the World (24.6% and 25.7% respectively) as well as the largest gender gap in unemployment. Recent estimates predict that as a result of the economic crisis, youth unemployment could increase by a 3 further 4.6% in the Middle East and up to 4% in ILO (May 2009): Global Employment Trends, May 2009 Update. 4 Betcherman, G., M. Godfrey, S. Puerto, F. Rother, and A. Stavreska. 2007. Global Inventory of Interventions to Support Young Workers: Synthesis Report. World Bank, Washington, DC; Bamfield, Louise. 2007. The Contribution of on-formal 1 G. La Cava (MNSSD, Regional Youth Coordinator), M. Learning to Young People's Life Chances. A Fabian Society Morgandi (MNSHD, JPA), I. Kaur (MNSHD, Social report for the National Youth Agency. National Youth Agency, Protection Specialist), A. Semlali (MNSHD, Consultant) Leicester, England; La Cava, G., Stadlbauer, V. and 2 MNSHD and MNSSD (2008): Youth an Undervalued Asset: O'Higgins, N. 2009. Youth Transitions to Employment and Towards a ew Agenda in the Middle East and orth Africa. Active Citizenship in ECA: From Policy to Action, World Progress, Challenges and the Way Forward, The World Bank Bank, forthcoming. A. The Joven Employment Programs for analyses found a positive impact on earnings Disadvantaged Youth in Eight Latin American approaching 26 percent, strongly significant for Countries5: The Joven programs offer youths 21 and younger. In absolute terms, the wage comprehensive training to unemployed and impact was higher for men, but in a comparison of economically disadvantaged youth 16 to 29 years of pre- and post program earnings, women had a age, aiming to improve their human and social slightly higher increase relative to men. capital and employability. The demand-driven model has been customized throughout Argentina, Costs and benefits: With the given underlying cost Chile, Colombia, the Dominican Republic, Panama, per trainee and the impact on employment and Paraguay, Peru, and República Bolivariana de earnings, the net present value (NPV) of the Venezuela. Technical training and internship program can be calculated (given a discount rate, experiences with employers are combined with usually assumed to be 5 percent). While costly, basic life skills and other support services to ensure these programs in Argentina and Chile have social integration and job readiness (see table). positive NPVs, with a higher NPV in Chile Private and public institutions--contracted through compared to Argentina. It is important to note that public bidding mechanisms--provide the training this calculation does not take into account the and organize the internships. externalities from the program such as better health outcomes and reductions in risky behavior among The programs target the poor, and more than 60 participants. In this sense, the estimates are likely to percent of participants come from low income provide only a lower bound of the NPV. It is also families. The highest education level completed by important to note that with the exception of beneficiaries was secondary, with significant forgone earnings, the party incurring the direct participation by school dropouts (50% in Chile costs (public funds) is different from the party Joven). Other targeting criteria, such as benefiting from the program--the participants. employment, gender, and age, also applied. Most beneficiaries had precarious employment Costs and impact of programs across countries conditions before the program. In Argentina 83 Argentina Chile percent of participants, and in Chile 57 percent Coverage (people) 116,000 165,000 were unemployed. Women were fairly equally Cost per trainee ($) 2,000 730­930 represented in Chile, while Argentina had the Private benefits lowest female participation (about 40 percent). Impact on + 10% + 21% Targeting focused on 16- to 24-yearolds, about 70 employment percent of all participants. Impact on + 10% + 26% earnings Employment: The programs increased the probability of beneficiaries finding employment upon graduation, especially for women. In B. Young Micro Entrepreneurs' Qualification Argentina, the program increased the probability of Program in Peru6: The Programa de Calificación de employment for young adult women (21 years and Jóvenes Creadores de Microempresas is implemented older) by about 10 percentage points over a control by the Peruvian NGO Colectivo Integral de Desarrollo group. In Chile, the program increased the in order to address the significant lack of probability of employment by 21 percentage points, entrepreneurial skills among young people. The with strongly significant results for youths 21 and objective of the program is to improve earnings and younger. the quality of life of beneficiaries by providing assistance and training in the development of Earnings: In Argentina, the program increased business plans and the creation of profitable monthly wages by about 10 percent over a control businesses. The target population consists of group, with results more favorable for young males economically disadvantaged young people, 15 to 25 and adult females. In Chile, one study showed a years old, with entrepreneurial skills or owning a negative impact on wages of -8.8 percent, led by a small and/or informal business (with less than a reduction of wages in the formal sector. Subsequent 5 The WDR 2007, p. 117. Aedo and Nuñez (2001); Aedo and 6 Pizarro Valdivia (2004); de Moura Castro (1999); Elias and Sources: Interventions to support Young workers in LAC others (2004); Inter-American Development Bank (2005); and Olga Susana Puerto (2007), Jaramillo (2006) and Jaramillo and Santiago Consultores Asociados (1999). Parodi (2003). September 2009 Number 10 2 year of operation), and residing in the localities Even though evaluations have not produced cost- targeted by the Program. benefit estimates, the program seems to yield positive net gains. Further evaluation and follow- The Program offers different types of services. up is needed to monitor the success of the program During the preparation phase, interested youth can over a longer period (for at least 2 years). benefit from mentoring and training for business plan preparation. Following the selection process, C. Enhancing Inter-ethnic Tolerance and Civic eligible young entrepreneurs are offered Engagement in Macedonia7: In 2001, following the mentoring, training and internships and they can inter-ethnic conflict in Macedonia, the World Bank easily have access to micro-credit. provided an IDA credit of USD 3 million to the Government of Macedonia to significantly increase The Program is ongoing: every year the social cohesion through the social integration of implementing NGO opens up a competition for disadvantaged youth from different socio-cultural interested youth. However, data is only available backgrounds8. The Macedonian Agency for Youth for the first three years of implementation (1999- and Sports, in its capacity of implementation 2001). During 1999-2001, the Program benefitted agency, established a national network of 33 youth throughout the country but for evaluation Babylon Youth Centers (BYC) offering integrated purposes (in order to avoid a dispersion of the youth friendly services at community level (i.e. free sample), only the beneficiaries living in the main non-formal education modules in life and urban areas were considered. employability skills, information technology, foreign languages, entrepreneurship, healthy Number of beneficiaries 481 lifestyles, sports and creative activities). Number of training activities 674 provided A particular focus of BYCs activities has been to Internship Participants 425 enhance social cohesion, inter-ethnic tolerance, and Number of Businesses Created 427 dialogue, as well as to promote civic engagement and prevent violence. These youth-friendly spaces Impact estimates with experimental data four provide young people with opportunities to months after the end of the implementation of interact with youth from other ethnicities (i.e. activities for year 2001 suggest: (i) an increase of 7.8 Albanian, Romas, Macedonian Slavs, among percentage points in the probability of having a others). The centers provide a complement to the business operating; and (ii) an 8 percent increase on formal school system, which has become the beneficiaries' average income. Estimates from increasingly segregated along ethnic lines. quasi-experimental data show the following: (i) an increase in almost 40 percentage points in the During the period of World Bank support (through probability of the business to operate for more than 2006), the BYCs annually benefited almost 16,000 a year; and (ii) an increase in earnings by 40 disadvantaged youth through their regular percentage points. An important secondary effect activities, as well as 2,000 youth in programs was on the job generation capacity. Beneficiaries outside the centers. The cost per beneficiary employ 17.3 percent more workers than the control declined from USD 54 at project launch to USD 17 group (interested but non-enrolled peers). at project completion. Approximately 70 percent of these beneficiaries were from low-income families Costs per beneficiary (in US$): and 9 percent were out-of-school youth. Over 150 1. Pre-selection of the beneficiaries $ 84 volunteers were involved in implementing the Pre-support for the Business Plan $ 29 project, in addition to well-trained young Pre-training courses $ 45 educators. Yearly beneficiary assessments and an Identification and promotion $10 impact evaluation conducted at the close of the 2. Post-selection of the beneficiaries $404 project documented the following results: Post-support (personalized tracking) $ 132 Post-training courses $ $ 51 Interethnic tolerance and social cohesion. Prior to Internships (per beneficiary) $ $ 173 taking part in BYC programs, 80 percent of Support Net (commercial fairs) $ 48 7 3. Equipment and Adm. Costs $ 48 World Bank, Implementation Completion and Results Report, Total Cost $536 June 29, 2007. 8 The total project cost was USD 5 million, the overall population of Macedonia is 2 million. September 2009 Number 10 3 beneficiaries stated that they did not have friends Reducing violent behavior. Data on youth violence from other ethnic groups. As a result of their available for the rural community of Caska participation in the centers, 67 percent reported suggested a correlation between BYC activities and developing and maintaining friendships with peers a reduction in violent behavior among youth. from other ethnic groups. Among beneficiaries According to official police records of the from mono-ethnic communities, 65 percent stated community, violent behavior among young people that they now actively considered involving peers dropped significantly as a percentage of total from other ethnic communities in their activities. registered police cases after a center was established in the town. Employability. 19 year-olds who spent more than two years benefitting from BYCs various activities were found to be 16 percent more employed than Contact MNA K&L: 18 year olds (the control group), that had only been Emmanuel Mbi, Director, MNA Operational Core exposed for a year or less. Minority youth and girls, Services Unit David Steel, Manager, MNA Development however, were less likely to be working than young Effectiveness Unit men from the predominant ethnic group. Among the 19 years old, with longer exposure to BYCs, the Regional Quick Notes Team: confidence about being fully employed was 7 Omer Karasapan, Dina El-Naggar, Roby Fields, percent higher than for those in the control group. Najat Yamouri, and Aliya Jalloh Tel #: (202) 473 8177 Civic engagement. The project had a significant impact in inducing young people to participate in The MNA Quick Notes are intended to summarize lessons learned from MNA and other Bank their communities. The longer they benefited from Knowledge and Learning activities. The Notes do not BYC programs, the more active they became in necessarily reflect the views of the World Bank, its their respective communities, including board or its member countries. participation in youth organizations, direct interaction with municipalities, and taking part in peaceful demonstrations. Some 25 percent of beneficiaries who had been enrolled in BYC activities since 2004 participated in community activities as active citizens. 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