Differentiating between effective and nominal access
A couple of months ago, one of our urban development colleagues wrote about the gap between effective and nominal access to water infrastructure services. She explained that while many of the households in the study area were equipped with the infrastructure to supply clean water, a large number of them do not use it because of its price. She highlighted a “simple fact: it is not sufficient to have a service in your house, your yard, or your street. The service needs to work and you should be able to use it. If you can’t afford it or if features—such as design, location, or quality—prevent its use, you are not benefiting from that service.” To address this concern, the water practice has been developing ways to differentiate between “effective access” and “nominal access”—between having access to an infrastructure or service and being able to use it.
In transport, too, we have been exploring similar issues. In a series of blog posts on accessibility, we have looked at the way accessibility tools—the ability to quantify the opportunities that are accessible using a transit system—are reframing how we understand, evaluate, and plan transport systems. We have used this method that allows us to assess the effectiveness of public transport in connecting people to employment opportunities within a 60-minute commute.
Incorporating considerations of cost
Yet, time is not the only constraint that people face when using public transport systems. In Bogota, for example, the average percentage of monthly income that an individual spends on transport exceeds 20% for those in the lowest income group. In some parts of the city, this reaches up to 28%—well above the internationally acceptable level of affordability of 15%.
Nick Carraway, the narrator in F. Scott Fitzgerald’s The Great Gatsby, remembers his father saying, “Whenever you feel like criticizing anyone … just remember that all the people in this world haven't had the advantages that you've had.”
What advantages? For starters, wealth, power, and in today’s developed world - college.
In the U.S., the college wage premium has risen rapidly since 1980 – causing a widening earnings gap between the college and non-college educated. Those with a bachelor’s degree earn over $800,000 more in lifetime income, on average, than those with high school diplomas. In the OECD, the college wage premium averages at 28 percent for male, full-time working employees - ranging from 18 per cent in Sweden to 50 per cent in the Slovak Republic.
As higher education expanded, college wage premiums were expected to decline. So why are they high and, often, increasing?
The consensus seems to point to increased computerization and automation in labor markets. Technology is expanding the demand for the college educated, at the expense of the non-college educated. This ‘job polarization’ in the labor market, manifests as the growth of high-education/high-wage jobs at the expense of middle-education/middle-wage jobs. This is increasingly visible not just in advanced economies, but also in the developing world. According to the Word Development Report 2016 on Digital Dividends, the share of middle-skilled employment is down in most developing countries for which detailed data are available.
Like many African countries, Senegal has a young population in search of decent jobs and salaries. A report covering the last national census of the Senegalese population, published every ten years by l’Agence nationale de la statistique et de la démographie (ANSD) (National Statistics and Demographics Agency), reveals that the average age of the population is approximately 22 years and that one in every two Senegalese is under 18 years of age. Those under 15 years of age represent more than 42% of the population, clearly indicating the predominance of the youth demographic. However, this segment of the population is most affected by under-employment and unemployment with young people representing 60% of job seekers.
We observed that over 78 percent of refugees in rural settlements, where they receive agricultural land, are engaged in agricultural activities compared to 5 percent in urban areas. Crop surpluses attract Ugandan traders to the refugee settlements, operating as a direct supply chain for sale of agriculture produce but also supply of agriculture inputs like fertilizers and seeds.
However, about 66 percent of respondents reported that local traders use faulty scales when weighing produce, which shortchanges them. Seventy percent decried the extremely low prices offered by local traders for produce, with implications for the ability and timing of refugees to become self-reliant. This was made worse by the significant losses in quality and quantity of agriculture produce due to poor harvest handling techniques and inadequate storage facilities, and surpluses were sold immediately after harvest at the lowest point in the price cycle. This shows that while refugees have land to cultivate, they are unable to realize the potential due to lack of technical, infrastructural and marketing support, contributing to food insecurity and under nutrition among smallholder farming refugee families, especially during lean seasons.
Business enterprises such as bars, hair dressing, milling, transportation, money transfers, and retail are run by refugees. Twenty-eight percent of female refugees are involved in agriculture, trade, or are self-employed; their participation in the formal sector is low—only 9 percent. Initiatives such as Community Savings Groups and women savings and credit groups have provided female refugees with seed money to start businesses. There is reportedly some level of gender discrimination with respect to access to land, credit, employment, and self-employment opportunities.
We observed that almost 43 percent of the refugees are actively engaged in the labor market of their host communities: 12 percent in the formal sector and 31 percent self-employed. However, refugees expressed constraints accessing formal employment both in urban areas and rural settlements, relating to unfamiliarity with the language, legal issues, poor interview skills, discrimination, and a lack of relevant documents. Refugees are mainly engaged in occupations that provide little income, social protection, or job security.
Refugee settlement areas have attracted the attention of Ugandan private enterprises, such as the Ugandan telecom companies, which launched several initiatives aimed at targeting refugee users of SMS banking and transfer services. For example, Orange Uganda Limited, a provider of telecommunication and Internet services in Uganda, invested in a large radio tower in the Nakivale settlement to promote its "Orange money" services. In Rwamwanja and Adjumani, a number of refugees operate as mobile money unit agents providing employment for them, while facilitating other refugees in accessing remittances from their relatives and friends within or outside the country. This mobile money is hugely helpful to refugees trying to meet expenses, including school fees for their children.
But in Uganda, and across the rest of the Horn of Africa, refugee camps and settlements are located in areas where the host communities are among the most underserved, with significant development deficits of their own. The majority of refugee settlements in Uganda are in the relatively stable north, though it has communities still in a state of latent conflict, driven by new and long-standing grievances, poverty, perception of marginalization, competition over national resources, and societal fracture as legacies of decades of violent conflict. The region also has high levels of poverty and youth unemployment which poses challenges to refugee efforts at self-reliance.
We see a huge opportunity in Uganda with the recent government-led efforts to address the development challenges of settlements that are home to locals and refugees with the inclusion of the Settlement Transformative Agenda (STA) as part of National Development Plan II (NDP II 2015/16–2019/20). The STA aims to promote social and economic development in the refugee hosting areas for both locals and refugee communities in partnership with the UN agencies in Uganda, the World Bank and other stakeholders. The World Bank is supporting this effort through the Development Response to Displacement Impacts Project (DRDIP) in Uganda, which will help improve access to basic social services, expand economic opportunities, and enhance environmental management for communities hosting refugees in Adjumani, Arua, Isingiro and Kyriandongo districts.
Their ages range between 16 to 25 years old. They are poor and unemployed. They once fought each other, literally, in their sectarian-divided Lebanese city of Tripoli. Sunni residents of Bab al-Tabbaneh and Alawite residents of Jabal Mohsen neighborhoods fought each other repeatedly.
But at the beginning of 2015, the government imposed a ceasefire that put an end to the endless rounds of fierce clashes and restored calm in the city.
And that’s when a Lebanese non-profit organization promoting peace through art went there looking for a different kind of recruitment: one of peace. March brought the youth together to perform in a play!
“The mentality of youth in Senegal is changing. These days, young Senegalese aren’t waiting for job opportunities to fall from the sky. They are actively working towards creating them for themselves, and for other youth.” These words, spoken by 30 year old Thierno Niang, a social entrepreneur and co-founder of Rev’evolution, a youth run, self-funded start up incubator, struck a chord with me. Thierno and I were discussing his role as a panel moderator for the Youth Forum on Employment, Training, and Inclusion: A Knowledge-Sharing Event for Sub-Saharan Africa, the first ever youth event of its kind organized by the World Bank office in Senegal.
Unemployment often rises during an economic crisis and policymakers take a range of actions to try to mitigate this increase. For example, 22 countries around the world used some form of wage subsidy program to promote employment retention during the recent crisis. Many studies have looked at the effect of wage subsidies on employment in non-crisis times, with mixed findings. But, there is not much evidence on whether wage subsidies can raise employment in the wake of a crisis.
Conceptually, wage subsidies during a crisis may make sense since layoffs could slow down the recovery as re-hiring and training workers may be costly for firms. This is particularly true for workers with job-specific skills. For these workers, it may be beneficial for firms to not let them go in the first place. However, as firms face lower demand for their products, they may not have the financial means to keep paying these workers, particularly in the presence of credit constraints, which are often exacerbated during a crisis. This is where wage subsidies come in. But, ultimately, we just don’t know whether these subsidies really cause firms to retain workers they otherwise would not have retained.
Young people account for almost half of Papua New Guinea’s population and comprise a large part of the urban poor. In the capital, Port Moresby, an increasing number of young people are leaving school without the necessary skills for entry-level jobs.
The Urban Youth Employment Project (UYEP) provides disadvantaged young people (aged between 16 and 35) in Port Moresby with life skills and employment training to increase their chances of finding long-term employment, also the motivation to make a fresh start in life. To help meet immediate economic needs, the project is also providing temporary employment opportunities.