Principal investigator: Adriano Valladão Pires Ribeiro
Article title: OVERCOMING YOUTH UNEMPLOYMENT IN EGYPT: RANDOMIZED EVALUATIONS SHOWCASE THE PROMISE OF ACTIVE LABOR MARKET PROGRAMS
Authors of the article: Ahmed Elsayed; Kevin Hempel; Adam Osman
Location of the Intervention: Beni Suef, Mynia and Greater Cairo – Egypt
Sample Size: 1743 individuals
Main theme: Labor market
Main Variable of Interest: JOBS
Type of Intervention: Internship and on-the-job training; Career counseling
Evaluation Method: Experimental Evaluation (RCT)
Evaluation Context
The Arab Spring of 2010 brought several challenges to Egypt, among them unemployment. In the country, unemployment, according to... World Bank dataThe unemployment rate jumped from 8,76% in 2010 to 11,85% in 2011, registering a peak of 13,15% in 2013 and remaining above 11% throughout the decade of 2010-2019. In turn, unemployment among young people aged 18 to 24... It remained consistently above 29%. During the same period, it is thus observed that the unemployment problem is even greater for young people.
Intervention Details
In response to the challenge of unemployment, the Egyptian government launched the Emergency Employment Investment Project (EEIP) in 2014. This project, which lasted until December 2017, received €67,6 million from the European Union, was administered by the World Bank, and implemented by the government through the Micro, Small and Medium Enterprises Development Agency (MSMEDA).
The project had several objectives, including: (1) creating employment opportunities for unemployed and employed individuals with low or no technical qualifications; and (2) improving the employability of young people through short-term training or support in transitioning to salaried or self-employed work. The target audience of the program was young people aged 18 to 29, unemployed and inactive, living in poor areas, with special attention given to disadvantaged groups in the labor market (e.g., the poor, young women, low educational level, people with disabilities, those without experience in the formal labor market, etc.).
It is also worth highlighting some characteristics of the implemented program design:
Public-private partnershipThe program was adopted through a partnership between the public sector (MSMEDA) and NGOs responsible for implementing the services for the beneficiary.
Adoption of Global Best PracticesThe participating NGOs had to prove, as part of their proposals, that there was a demand for jobs for the services they would offer.
Focus on resultsThe achieved result would be more important than the activities themselves, with, for example, part of the payment tied to goals. The result reported by the NGO would be validated by an independent verification.
Focus on knowledge generation.The projects that received support would serve as a basis for implementing future youth employment interventions in Egypt.
MSMEDA, using its own criteria, then selected some NGOs to participate in a workshop and to select the best ideas for implementing the employment program. Ten NGOs were listed, and the two best proposals were selected to proceed with the program (thus called NGO1 and NGO2). NGO1 focused on self-employment and is based in the cities of Beni Suef and Minya, while NGO2 focused on obtaining salaried work and operated in Greater Cairo and Beni Suef.
Assessment Method
The method adopted by the two NGOs to evaluate the results of the policy is similar. To accurately assess the impact of the employment program, those enrolled in each program were randomly selected into a control group and two treatment groups. The randomness in selecting program candidates aims to eliminate selection biases and ensure that, on average, all groups have similar characteristics, differing only in whether or not they receive treatment. Therefore, the difference in final results can be attributed to the employment program. The two NGOs are then discussed in more detail.
NGO1 – Self-employment
NGO1 issued a public call for applications for training and counseling services. Because they received more applications than available places, they selected 1011 people who were considered most suitable and least likely to drop out of the training halfway through. The selected individuals were randomly assigned to three groups: (1) a group receiving only training (337 people); (2) a group receiving both training and counseling (335 people); and (3) a control group receiving neither service (339 people).
The next step is to ensure that the sampling was done correctly, that is, that the groups are balanced, thus guaranteeing the research results. It is found that the three groups are balanced, with insignificant differences between each regarding characteristics such as age, family income, proportion of women, education, among others. Another point to be checked for the research is whether the individuals actually adopted the treatment, that is, whether they attended the training and participated in the counseling sessions. This was the case, noting that the control group did not receive any training.
Therefore, both the balance between the groups and the randomness in the division of individuals into each group allow for a comparison of the average outcome of each group to assess the impacts of the employment program.
NGO2 – Search for salaried work
The NGO2 intervention focused primarily on supporting young people in obtaining salaried employment. The control group – which received no benefits – consisted of 241 individuals, while the treatment group was divided into two: (i) a group of 250 individuals who received training and (ii) another group of 241 participants who received training and individual counseling.
As with NGO1, the participants in NGO2's program were randomly divided into each group to ensure that the results could be interpreted as an impact of the program. It is also worth noting that the division between the groups was balanced and that both training and counseling were correctly distributed to each group; that is, the control group received neither training nor counseling, and only the group that should have received counseling did.
Results
The following are the results reported by the two NGOs' programs regarding job retention, wealth, and weekly working hours.
JOBSFrom the program implemented by NGO1, the group that received only training reported that 45% were employed, while for those who also received counseling, the percentage was 43%. These values contrast with the average of the control group, which was 15%.
According to NGO2, both treatment groups reported that 47% of individuals were employed, a higher figure than the 35% reported by the control group.
IncomeFor NGO1, the monthly income of the training group increased by 91 EGP (Egyptian currency) and for the training and counseling group it increased by 63 EGP when compared to the average of the control group. Furthermore, the proportion of individuals without income decreased by 17% and 19% for those who received training and those who received training and counseling, respectively, in relation to the control group.
For NGO2, the training group reported an increase in income of 99 EGP, while the training and counseling group observed an increase of 104 EGP when compared to the average income of the control group. The percentage of people with no income in the control group was 18%, a value that decreased in the other groups, to 15% in the training group and 11% in the training and counseling group.
Working TimeThe control group from NGO1 reported an average increase of 6 hours in hours worked per week, while the training group reported an increase of 7,85 hours, and the training and counseling group increased by 8,6 hours.
In NGO2, when compared to the control group, both treatments showed an increase in weekly working hours. The increase in the training group was 2,7 hours and in the training and counseling group it was 3,6 hours.
Lessons in Public Policy
Three important lessons for public policy emerge from this study. First, youth-focused employment programs can yield positive results in terms of employment and income, as highlighted above for Egypt. Second, Public-Private Partnerships are a promising way to implement employment programs. This is due to the combination of clear objectives as outcomes with the flexibility to implement the type of intervention appropriate to the target group's context. Finally, by following an appropriate methodology, it is possible to measure and evaluate the impact of well-designed public policies.
Reference IZA, Ahmed Elsayed; HEMPEL, Kevin; OSMAN, Adam. Overcoming Youth Unemployment in Egypt. 2018.
