The Impact of Skills Training on Financial Behaviour, Employability, - PowerPoint PPT Presentation

The Impact of Skills Training on Financial Behaviour, Employability, and Educational Choice of Youth: j Findings from a Randomized Controlled Trial in Morocco Drew Gardiner, Jonas Bausch: ILO Jochen Kluve: Institute for the Study of Labor Paul Dyer: Silatech Elena Mizrokhi: MEDA ILO Geneva | Tuesday, 12 July 2016

Youth Economic Exclusion in MENA and Morocco: • Labour market access in Morocco: 19% unemployed; NEET youth: 40% among young men and 90% among young women (ILO 2014; World Bank 2012) • Lack of financial inclusion: over 80% of MENA youth unbanked & low awareness of financial services among youth in Morocco (World Bank 2014) • Focus on skills development in MENA not matched by evidence on „ what works “ 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 2

MEDA Maroc: 100 Hours to Success • Component of larger YouthInvest project, 2008-2014, to foster economic and financial inclusion of youth • Mix of training providing 100 hours of instruction, with modules in three areas: • Financial literacy & management • Life skills • Business and entrepreneurial skills • Delivered over 1-3 month period at existing youth centres (typically in the evenings) • Experiential teaching methods: live examples, case studies & high interaction among participants. 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 3

MEDA Maroc: 100 Hours to Success • Target group: 20’000 Moroccan youth between 15-25 years of age • Assumptions: • Additional training teaches skills not covered by formal educational system • Key constraints on supply side of the labour market 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 4

Evaluation Questions & Indicators • Financial • Confidence knowledge • Team work • Bank account • Problem • Saving / solving Financial borrowing behaviour Inclusion Life Skills & Do impacts differ Literacy across groups based on gender , age , and socio-demographic background ? Employ- Educational ability Choice • Labour Market • Educational Status status • Aspirations 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 5

Evaluation Design Identification Strategy • Randomization : two groups sharing on average the same characteristics – confirmed by baseline survey • Only members from the treatment group are offered place at 100 Hours to Success • Impacts: We compare (changes in) outcomes between both groups using data from the baseline and follow-up survey 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 6

Evaluation Design & Timeline Baseline: Sep-Oct 2012 1815 youth registered & interviewed Randomization & Training: Dec-Aug 2012/13 Treatment group: Control group: 462 out of 915 youth receive training 900 youth Follow-Up: Follow-Up: 442 youth surveyed 429 youth surveyed Follow-Up survey: Aug-Oct 2015 871 youth surveyed & proxy information for 200 individuals 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 7

Evaluation: Caveats • Take-Up: Only 462 out of 900 youth that were offered the training enrolled in the programme • Presenting Local Average Treatment Effects (LATE) • Drop-Outs / Non-Attendance: Not all youth that enrolled completed the training • Attrition in follow-up: 52% of youth could not be interviewed in endline survey • Baseline values (observables) still balanced • Results robust to variety of sensitivity checks • But: Little room for disaggregation! 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 8

Financial Literacy & Inclusion 70% *** 60% 50% 40% 30% 20% 10% 0% Financial Has saving Does save Participates Maintains Borrowed Literacy account in savings budget since Oct Index group 2012 Control Treatment 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 9

Life Skills 5 4.5 4 3.5 3 2.5 2 1.5 1 0.5 0 Satisfied with Community Risk-Scale GRIT-Scale role in Problem Solving community Scale Control Treatment 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 10

Labour Market Outcomes & Educational Choice 80% * 70% 60% 50% 40% 30% 20% * 10% 0% Enrolled in NEET Employed Unemployed Inactive Any work education exp. Control Treatment 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 11

Labour Market Status & Education: Men, Follow-Up 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% In-Education Not-in-Education Employment Unemployment Inactivity 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 12

Labour Market Status & Education: Impacts for Men Education: Yes Education: No 60% 0.391 40% 20% 0.093 0% -0.022 -0.086 -20% -0.188 -0.188 -40% -60% Employment Unemployment Inactivity 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 13

Labour Market Status & Education: Women, Follow-Up 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% In-Education Not-in-Education Employment Unemployment Inactivity 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 14

Labour Market Status & Education: Impacts for Women Education: Yes Education: No 60% 40% 20% 0.088 0.051 0.016 0% -0.007 -0.041 -0.106 -20% -40% -60% Employment Unemployment Inactivity 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 15

Findings: Summary • Maintaining bank accounts: Yes! Changing financial behaviour: (rather) No! • Life Skills: No evidence of long-term impact • Increased investment education: both in terms of length and heightened attention … but only for male youth 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 16

Conclusion: Lessons learned • Encourage education: Skills trainings can trigger greater investment in human capital • Important if lack of skills is a key constraint for young people in the labour market (are there high skill premia?) • But: (formal) education ≠ job guarantee (cf. SWTS Egypt) • Targeting: youth (15-25 years) might still be too diverse when aiming at school-to-work transition and/or financial training: • Striking and increasing gender differences wrt labour market participation: 44% men vs, 12% women employed at time of follow up (avg. age: 23) • Saving requires income and borrowing collateral 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 17

Avenues for future research in youth employment • How to increase take-up and reduce drop- out? (i.e. low relevance/quality vs. low self- control vs. lack of information) • How to impact (financial) behaviour with classroom based trainings? • Global evidence favours multi-pronged interventions but how to combine components best? Financial literacy, life skills, business management, internships, apprenticeships... 12.07.2016 Evidence from RCTs in Youth Employment | ILO Geneva 18

Thank you for your attention!