What we’ve learned about supporting jobs in fragile and conflict-affected environments

The development community has begun paying more attention to supporting jobs in situations somaliland-schulman-5981of fragility, conflict, and violence (FCV). There are still many things we don’t know, but we have made progress: We can draw lessons from programs financed out of the US$14 billion investment in FCV through IDA18 and a number of new impact evaluations.

We summarized these lessons in our recent Jobs Note, “Supporting Jobs in Fragility, Conflict, and Violence (FCV) Situations.” Here are a few key takeaways.

Cash grants (and some in-kind support) have a good track record in raising incomes

In FCV settings, investing in your business is a tough risk to take. Often the only funding source is a household’s own savings or loans from family and friends. Young workers face a frustrating wait as they save up to start small business activities.

It is therefore perhaps not surprising that there have been good results in projects that provide grants of US$200 to US$1,000 for small business activities (or in-kind support to agriculture). After some seminal impact evaluations, such support is now going to scale – for instance, through the Sahel Productive Inclusion initiative, which reaches some 50,000 households. However, questions remain: How far can beneficiaries go with modest cash support? Do benefits last? What about those who don’t get support – do they face stiffer competition, or have they found new customers? But while these questions need answers, cash deserves attention as a way of supporting jobs in FCV.

If the goal is better jobs outcomes now, think twice before betting big on skills training or microfinance

With low skill levels and virtually no access to finance, FCV economies need steady investment in education and financial infrastructure to begin to build capacity. However, if the goal is to improve jobs over the short term, technical training and microfinance do not have a good track record in FCV situations. Perhaps that makes some sense: A more skilled worker may not fare much better in her activities if she has no funding and faces a depressed market; and in a situation where every small investments is risky, few will take on the risks that come with a microloan. Since these approaches also tend to be somewhat costly, it’s worth asking hard questions about what the goal is, and whether it is likely to be achieved. There are, however, exceptions to this stylized picture: Farmer field schools, digital extension services, and soft skills training have shown promise at limited cost.

Labor-intensive public works are a proven way to boost short-run incomes, but may not solve longer-term problems

Because they are a relatively simple and quick way to give income support, labor-intensive public works (LIPW) are an important tool to support jobs in natural disasters, demobilization of armed groups, or where conflict has so disrupted markets that it is hard to make a living with small business activities.  Programs have also used LIPW effectively to signal a turn-around from conflict to recovery.

With that said, we sometimes risk looking to LIPW as a simple solution to a host of problems: building lasting skills, helping beneficiaries find permanent employment, preventing conflict, and empowering communities. LIPW may sometimes succeed in these areas, but mostly, these issues require other support. It is prudent to see them as “stretch goals” and evaluate LIPW on the merits of what they do reliably: short-term income support.

Low demand in the market deserves more attention

Most development programs to support jobs look to make businesses and workers stronger. However, one of the ways in which fragile economies are different is in just how disrupted markets are. Conflict depresses consumer purchasing power, and traders who travel from farm to village and village to town face physical danger and financial risk. Finding customers can be difficult, and there is no guarantee that investments will pay off.

There is no go-to solution, but two approaches to stoke demand have made some progress. First, it is worth asking how development spending that is already taking place can best translate into market demand: local procurement of humanitarian food aid can make a difference, and demobilization and social safety net payments alike can boost purchasing power in depressed markets. Secondly, there is a case for directly supporting those who connect markets, such as aggregators. We should experiment to put together a better toolbox.

Psycho-social support is ready for testing at scale

Researchers and practitioners have started paying attention to the emotional burden of making a living in a fragile environment, and have developed programs to provide support. At small scale, short group training courses have shown their effectiveness. It is worth testing whether they can deliver at scale, too.

This blog is based on the Supporting Jobs in Fragility, Conflict, And Violence (FCV) Situations Solutions Note, published in April 2020. This is the sixth post in a blog series based on research and evidence from the World Bank Jobs Group’s Solutions Notes. The Solutions Notes synthesize findings from the Jobs Umbrella Multidonor Trust Fund (MDTF)-funded activities and other sources based on research, evaluations, pilots, and operations. Each Note succinctly analyzes efforts and challenges, and provides an evaluation of what has worked, and what does not.
The first five posts in the series include: