Job Training and Job Search Assistance Policies in Developing Countries
Journal of Economic Perspectives
vol. 38,
no. 1, Winter 2024
(pp. 221-44)
(Complimentary)
Abstract
Governments around the developing world face pressure to intervene actively to help jobseekers find employment. Two of the most common policies used are job training, based on the idea that many of those seeking jobs lack the skills employers want, and job search assistance, based on the possibility that even if workers have the skills demanded, search and matching frictions make it difficult for workers to be hired in the jobs that need these skills. However, reviews of the first generation of evaluations of these programs found typical impacts to be small, casting doubt on the usefulness and cost-effectiveness of these programs. This paper re-examines the arguments for whether, when, and how, developing country governments should undertake job training and job search assistance policies. We use our experience with policy implementation, and evidence from recent impact evaluations, to argue that there is still a role for governments in using these programs. However, success depends critically on program design and delivery elements that can be difficult to scale effectively, and in many cases the binding constraint may be a lack of firms with job openings, rather than a lack of workers with the skills to fill these openings.Citation
Carranza, Eliana, and David McKenzie. 2024. "Job Training and Job Search Assistance Policies in Developing Countries." Journal of Economic Perspectives, 38 (1): 221-44. DOI: 10.1257/jep.38.1.221Additional Materials
JEL Classification
- E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
- J24 Human Capital; Skills; Occupational Choice; Labor Productivity
- J31 Wage Level and Structure; Wage Differentials
- J64 Unemployment: Models, Duration, Incidence, and Job Search
- J68 Mobility, Unemployment, and Vacancies: Public Policy
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