Jobs, justice, and security. These were three key messages from the 2011 World Development Report on conflict, security, and development. Two years later, the WDR on jobs reiterated the message that jobs are critical for a sustainable way out of poverty and that in fragile environments they promote social cohesion. So it was agreed: jobs are good in any country and even better in places where conflict and fragility is a problem.
While both seem reasonable arguments, things are not as straightforward in reality. First, there is the uncomfortable question of whether programs that intend to improve employment actually do so. That is, are we actually able to increase employment? And if we are, what are the most cost-effective programs? Second, is the link between jobs and conflict or violence clear? Are jobs really the silver bullet to countering fragility? Or should policymakers be more modest in their expectations about employment programs?
On the first question, programs are not equally effective at increasing employment or creating jobs. In a recent working paper, Chris Blattman and I look at two commonly used approaches: increasing the demand for labor or increasing the productivity of labor. On increasing productivity, we see a mix of skill-based programs that aim to boost human capital as well as capital-based programs that encourage investment in income-generating assets, particularly among those who are self-employed. The evidence on a large number of skill-based programs is mixed. While some show positive impacts on employment and earnings, others do not, especially for young men. For example, a large-scale government run training program in Turkey found insignificant impacts on employment. On the other hand, capital-centric programs, despite being less common, have shown promising results. See, for example, the results of the Youth Opportunities Project in northern Uganda, where grants given to groups of youth led to about a 40 percent increase in earnings. And these programs are, on average, far more cost-effective. With limited resources, it seems a better use of time and money to focus on how to improve capital-based programs than skill-based ones.
On increasing demand for jobs, public works programs are used to create short-term jobs mainly for unskilled labor. These can be particularly helpful in fragile or unstable environments, where property rights are less secure and the future is uncertain, as they provide an immediate source of income at a time when other activities may be limited. They may possibly occupy high-risk groups, such as former soldiers or potential recruits, who might otherwise contribute to the instability. However, whether this is true in practice and what other effects public works lead to, such as increased investments in livelihoods or children, is unknown as there almost no rigorous evaluations of these programs. We don’t know how much employment or investment there would have been in the absence of the public works program. This is shocking given how common these programs are.
Assuming we can first provide jobs, are they the silver bullet to countering fragility? Successful employment programs can be effective at shifting the time-use of young men from crime and mercenary work towards legal occupations. But these people may still hold these illegal activities in their portfolio; they just steal and fight less when peaceful alternatives pay better. And since many violent groups do not use material incentives to motivate people, jobs programs cannot be the panacea for all situations. To understand when jobs actually lead to the peace-building outcomes we often posit they will, we need to be measure these outcomes. A recent review of World Bank programs found a total lack of measurement of these types of outcomes.
Our paper makes several suggestions for policymakers who plan and implement employment programs. One worth emphasizing is the use of pilots among small cohorts of recipients before launching a program at scale. Piloting and experimentation is routine in the private sector, yet it is often not incorporated into international development programming. When data is scarce and the context new, it can be particularly valuable. Many programs are ineffective, or at least inefficient, since the constraints to finding employment or pursuing individual enterprises are poorly diagnosed. The use of pilots can help focus in on which constraints matter before a costly program is taken to scale.