Current economic growth not enough to create enough employment.
Many youth in developing countries can’t read or write.
Bank scaling up efforts to support the creation of good jobs.
May 6, 2008—How can developing countries tap the potential of their 1.3 billion young people to produce surging economic growth and sharply reduce poverty?
And how should these countries combat high underemployment, poor working conditions, low wages, and increased inequality and exclusion?
These concerns are among the issues being discussed May 5 and 6 in Rabat, Morocco, at the third Employment and Development Conference sponsored by the World Bank and Bonn-based Institute for the Study of Labor (IZA).
About 170 leading thinkers on labor and employment will take up topics ranging from child labor and labor migration to informal “under-the-table” work, discrimination against women, and job training.
“Employment and good jobs are critical for growth and poverty reduction,” says Robert Holzmann, Director of the Social Protection and Labor Department of the World Bank’s Human Development Network, and an organizer of the conference.
But high growth has not always led to more, better, or higher paying jobs, says Ana Revenga, Director in the Poverty Reduction and Economic Management Network of the World Bank. Many new jobs in subsistence agriculture or the informal sector require few skills and offer low pay, she adds.
Growth has also not been high enough to create enough jobs for the large number of young people entering the job market in developing countries, notes Holzmann.
The Many Young People at Disadvantage in Job Market
Middle East and North Africa alone needs to create 100 million jobs by 2020 to stabilize the region’s employment situation, according to the World Bank’s 2007 World Development Report.
Many young people are at a disadvantage in the job market, particularly in developing countries. Nearly half of the world’s unemployed are young, and 130 million people 15 to 24 can’t read and write.
The goal of the conference and policy forum, says Holzmann, is to build the kind of knowledge it will take initiate policies that work in developing countries, and to help get decision-makers together to explore options to deal with employment creation, job training, education, and other related issues.
Two US$500,000 grants will be announced at the conference; one for further research on labor migration and labor market performance in developing countries, and the other for research into how labor markets function in countries with large unregulated informal sectors. The grants are funded by a multi-donor trust fund that will scale up research, help countries build capacity to develop labor market policy, and pilot promising approaches.
We have received more than 180 submissions in response to the conference call for proposals, says Jean Fares, a Senior Economist in the Human Development Network. The conference’s scientific committee accepted 90 papers by researchers from all over the world working on employment issues in developing countries. The conference will also include invited panels of leading academics and policy makers.
‘Our Country Clients Are Asking for Solutions’
Interest in labor market issues has increased both at the World Bank and among the Bank’s client countries, says Fares. “Our country clients are asking for solutions.” For instance, employment is at the top of host country Morocco’s agenda, Fares notes, and will be reflected by the presence of a large Moroccan delegation at the conference, including two ministers.
The World Bank is also scaling up its own efforts to support countries encouraging the creation of good jobs, says Holzmann. The proposed program focuses on macroeconomics, investment climate, labor market institutions, education and skills, and social protection and is known as MILES. The goal is to find innovative ways to assess and address key bottlenecks in job creation, and test them in the field.
“Right now we don’t have a good understanding about the functioning of the labor market in low- and middle-income countries. If you don’t have a good model, it’s difficult to prepare good policies,” says Holzmann.
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