The global number of people forced to flee their homes stands at its highest since the Second World War, and an increasing share of the world’s poor live in economies facing fragility, conflict, and violence (FCV). This growing population needs impactful, cost-effective and cost-efficient jobs support to make the best use of the resources available given the enormous needs—but we have little information about job project costs in difficult environments.
A new World Bank study addresses this knowledge gap about how much it costs to create and sustain jobs in conflict and forced displacement settings. Drawing on a novel dataset covering jobs project portfolios from the United Nations High Commissioner for Refugees (UNHCR), the UK Foreign, Commonwealth and Development Office (FCDO), and the World Bank, our analysis of project costs and results can help inform budgeting and design for jobs support initiatives in crisis situations and globally.
What do we know about supporting jobs for people affected by crises?
Responding to the increased need for support, the World Bank and other donors have stepped up their investment in FCV and forced displacement. Jobs support is a vital part of this investment, and we have learned a lot about what works in forced displacement and FCV contexts. Recent Jobs Solutions Notes on FCV and on forced displacement capture global findings on supporting jobs, while an excellent example of the growing number of jobs impact evaluations in fragile settings is the impact evaluation of the Sahel Adaptive Social Protection program. We know much less, however, about the cost efficiency and cost effectiveness of our jobs support in FCV and forced displacement – in fact, gathering data for our study proved more difficult than expected, as most job project reporting is not designed to assess cost per output or outcome.
What have we learned about cost-efficient and cost-effective jobs projects?
Our study is based on a new dataset that we compiled covering six low- and middle-income economies affected by conflict and displacement: Iraq, Jordan, Kenya, Lebanon, Mali, and South Sudan. It includes the following highlights:
It is easier to make the case for cost effectiveness in projects that give capital to workers than training. Across contexts, the typical project that helps beneficiaries access capital (e.g., cash grants, access to finance, or farming inputs) spends much less per beneficiary than the typical training project ($135 compared to $683). When we look at the beneficiary numbers that projects report, capital support and training projects both look like they typically break even within about five years. At the same time, however, impact evaluations show that capital support is much more likely than training to get someone a job they would not have had without support, so the case for cost effectiveness is easier to make.
FCV and forced displacement environments tend to widen the cost gap between capital support and training or matching. The activities displaced workers and others in FCV economies undertake to earn an income in the market tend to be basic and require modest support. Simple capital support projects using context-appropriate, proven designs are a good fit with the difficult operating environment. Conversely, training and matching projects for refugees and internally displaced people must be adapted to their specific needs as they try to navigate labor markets that are foreign and sometimes hostile to them. Providing additional services such as legal assistance, language training and psychosocial support increases costs. Improving the legal environment for the displaced would increase cost-efficiency and cost-effectiveness.
Projects that help firms create jobs need to deliver good quality jobs and sustained growth to break even. A typical project that works with firms spends 75 times more on each participating firm than what other projects spend per individual beneficiary. Their median cost per job is about $14,000. Breaking even requires these projects to create well-paying jobs and continued job growth instead of one-off hiring. Projects with good job quality typically break even in 2-5 years—with lower quality, it may take a decade.
How can you use the data and results?
In budget planning, the data can serve as a quick reference to understand how many beneficiaries a project can reach or what budget it takes to reach a certain number of beneficiaries. In designing job support, the report can help unpack key assumptions that matter for cost effectiveness, and it flags some types of support that tend to be costly for scrutiny.
This work is part of the program "Building the Evidence on Forced Displacement: A Multi-Stakeholder Partnership.'' The program is funded by the UK’s Foreign, Commonwealth, and Development Office. It is managed by the World Bank Group and was established in partnership with the United Nations High Commissioner for Refugees.