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:

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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“

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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.

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MEDA Maroc: 100 Hours to Success

• Target group: 20’000

Moroccan youth between 15-25 years

• f age
• Assumptions:
• Additional training

teaches skills not covered by formal educational system

• Key constraints on

supply side of the labour market

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Evaluation Questions & Indicators

• Educational

status

• Aspirations
• Labour Market

Status

• Confidence
• Team work
• Problem

solving

• Financial

knowledge

• Bank account
• Saving /

borrowing behaviour

Financial Inclusion & Literacy Life Skills

Educational

Choice Employ- ability

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Do impacts differ across groups based

• n gender, age, and

socio-demographic background?

Evidence from RCTs in Youth Employment | ILO Geneva

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)
• utcomes between both groups using

data from the baseline and follow-up survey

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Evaluation Design & Timeline

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Treatment group: 462 out of 915 youth receive training Control group: 900 youth Baseline: Sep-Oct 2012 1815 youth registered & interviewed Randomization & Training: Dec-Aug 2012/13 Follow-Up survey: Aug-Oct 2015 871 youth surveyed & proxy information for 200 individuals Follow-Up: 429 youth surveyed Follow-Up: 442 youth surveyed

Evaluation: Caveats

• Take-Up: Only 462 out of 900 youth that were
• ffered 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!

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Financial Literacy & Inclusion

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***

0% 10% 20% 30% 40% 50% 60% 70% Financial Literacy Index Has saving account Does save Participates in savings group Maintains budget Borrowed since Oct 2012

Control Treatment

Life Skills

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0.5 1 1.5 2 2.5 3 3.5 4 4.5 5

Satisfied with role in community Community Problem Solving Scale Risk-Scale GRIT-Scale

Control Treatment

Labour Market Outcomes & Educational Choice

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* *

0% 10% 20% 30% 40% 50% 60% 70% 80% Enrolled in education NEET Employed Unemployed Inactive Any work exp.

Control Treatment

Labour Market Status & Education: Men, Follow-Up

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0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

In-Education Not-in-Education Employment Unemployment Inactivity

Labour Market Status & Education: Impacts for Men

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• 0.086
• 0.188
• 0.188
• 0.022

0.391 0.093

• 60%
• 40%
• 20%

0% 20% 40% 60%

Education: Yes Education: No Employment Unemployment Inactivity

Labour Market Status & Education: Women, Follow-Up

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0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

In-Education Not-in-Education Employment Unemployment Inactivity

Labour Market Status & Education: Impacts for Women

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• 0.007
• 0.106

0.051 0.088

• 0.041

0.016

• 60%
• 40%
• 20%

0% 20% 40% 60%

Education: Yes Education: No Employment Unemployment Inactivity

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

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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

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Avenues for future research in youth employment

• How to increase take-up and reduce drop-
• ut? (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...

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Thank you for your attention!