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While mostly missing their primary objectives, adult
literacy programs can still improve key socio-economic outcomes
In addition to the traditional education system
targeting children and youth, one potentially important vehicle to improve
literacy and numeracy skills is adult literacy programs (ALPs). In many
developing countries, however, these programs do not seem to achieve these
hoped for, ex ante, objectives and have therefore received less attention,
if not been largely abandoned, in recent years. But, evidence shows that
ALPs do affect other important socio-economic outcomes such as health,
household income, and labor market participation by enhancing participants’
health knowledge and income-generating activities.
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Why spending on occupational skills can yield
economic returns to employers
Economists have long believed that firms will not
pay to develop occupational skills that workers could use in other, often
competing, firms. Researchers now recognize that firms that invest in
apprenticeship training generally reap good returns. Evidence indicates that
financial returns to firms vary. Some recoup their investment within the
apprenticeship period, while others see their investment pay off only after
accounting for reduced turnover, recruitment, and initial training costs.
Generally, the first year of apprenticeships involves significant costs, but
subsequently, the apprentice's contributions exceed his/her wages and
supervisory costs. Most participating firms view apprenticeships as offering
certainty that all workers have the same high level of expertise and
ensuring an adequate supply of well-trained workers to cover sudden
increases in demand and to fill leadership positions.
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Increasing the availability of high-quality job
opportunities can reduce recidivism among released prisoners
The majority of individuals released from prison
face limited employment opportunities and do not successfully reintegrate
into society. The inability to find stable work is often cited as a key
determinant of failed re-entry (or “recidivism”). However, empirical
evidence that demonstrates a causal impact of job opportunities on
recidivism is sparse. In fact, several randomized evaluations of
employment-focused programs find increases in employment but little impact
on recidivism. Recent evidence points to wages and job quality as important
determinants of recidivism among former prisoners.
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Penalties may last ten years or more, especially
for high-educated youth and in rigid labor markets
The Great Recession that began in 2008–2009
dramatically increased youth unemployment. But did it have long-lasting,
adverse effects on the careers of youths? Are cohorts that graduate during a
recession doomed to fall permanently behind those that graduate at other
times? Are the impacts different for low- and high-educated individuals? If
recessions impose penalties that persist over time, then more government
outlays are justified to stabilize economic activity. Scientific evidence
from a variety of countries shows that rigid labor markets can reinforce the
persistence of these setbacks, which has important policy implications.
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Broadband infrastructure has differing effects
on workers of different skills
Broadband infrastructure enables fast access to
the internet, which, evidence suggests, has significant effects on economic
growth. However, labor market related issues have not received as much
consideration. These include quantifying employment effects of broadband
infrastructure roll-out and questions about who exactly are the winners and
losers in the labor market, and whether skills in information and
communication technologies (ICT) are reflected in labor market outcomes such
as wages. Understanding these complementary issues allows for policy
conclusions that go beyond simply encouraging the subsidization of broadband
internet infrastructure.
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Secondary and higher education are windows of
opportunity for boosting students’ life skills
Life skills, sometimes referred to as
noncognitive skills or personality traits (e.g. conscientiousness or locus
of control—the belief to influence events and their outcomes), affect labor
market productivity. Policymakers and academics are thus exploring whether
such skills should be taught at the high school or college level. A small
portfolio of recent studies shows encouraging evidence that education could
strengthen life skills in adolescence. However, as no uniform approach
exists on which life skills are most important and how to best measure them,
many important questions must be answered before life skill development can
become an integral part of school curricula.
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Systems combining structured learning on the job
with classroom training can ease youth unemployment
Youth unemployment has increased in many
industrialized countries following the recent global recession. However,
this reflects not only the cyclical shock, but also the crucial role of
institutions in structuring the transition from school to work. Vocational
training, in particular in a dual form combining vocational schooling and
structured learning on-the-job, is often considered to be one of the most
important policy solutions in combating youth unemployment. The evidence
available supports this perception, but the institutional requirements of a
successful training system also have to be taken into account from a policy
perspective.
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Cost–benefit surveys of employers help design
more effective training policies
Apprenticeship training programs typically last
several years and require substantial investments by training firms, largely
due to the associated labor costs for participants and instructors.
Nevertheless, apprentices also add significant value in the workplace. One
tool to measure the costs and benefits of training for firms is employer
surveys, which were first introduced in the 1970s in Germany. Such
cost–benefit surveys (CBS) help to better understand a firm's demand for
apprentices and to identify market failures. Therefore, CBS are an important
tool for designing effective training policies.
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Staffing agencies could play a more prominent
role in the provision of training for the low qualified and previously
unemployed
Temporary work agencies use training as a
recruitment and retention argument when qualified labor is scarce. However,
short job assignments present a major obstacle for employers and employees
to increase investment in training. As temporary agency workers are mainly
low-qualified and often previously unemployed, paid work in combination with
training should lead to more sustainable employment. Adjustments in labor
market institutions could make the provision of training more attractive for
both staffing agencies and temporary agency workers.
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