“It is clear that any proposed solutions to the youth employment challenge which do not take on board the expectations, frustrations and aspirations of young people in relation to the labour market will struggle to meet the needs of youth.” Youth Employment Network 2007

Funded by DFID and SDC, Helvetas Nepal’s employment fund provides skill training to economically poor and socially discriminated out-of-school youth. Private service providers help identify the market potential as well as train participants. The payment to the service providers is based on the type of category trained and linked to outcomes: the service provider does not get any payment for those trainees who do not achieve employment.

Problems addressed

• Youth are an economic asset and their capacity needs to be tapped for national growth.
• While 300,000 young people enter the labour market every year, only 50,000 are receiving skills training and according to the 2008 National Labour Force Survey, 46% of 20 to 24 year- olds are “highly underutilised.”

Objectives

• To provide skill training to poor and socially discriminated out-of-school youth (18 to 35 years) and ensure their gainful employment;
• To promote decent work;
• To address the employment needs of youth in order to mitigate social and political instability;
• To address the particular needs of conflict-affected youth (IDPs, ex- combatants), widows, and the disabled.

Youth as beneficiaries

Fourteen thousand five hundred young people (18 to 35 years), 57% female, received vocational training and support, credit linkage and life skills. N.B., a partner approach can be taken by recruiting outstanding trainees to train others and review project design.

Process

• Timeframe: 12 months; three months training plus follow up.
• Private service providers (currently 17, in 38 districts) are selected based on a competitive bidding system.
• A rapid market appraisal is carried out to identify local market need by the service provider.
• Target groups categorised (by gender, caste etc).
• Implementation of training. Mobile trainings for geographically isolated youth groups.
• Post-training support includes market linkage, business counselling and knowledge on labour rights and credit linkage.
• Differential pricing mechanism (see below) ensures that youth from disadvantaged groups are reached.
• Payment to service provider is based on outcomes. The first payment is made after submission of training completion report (40% of the outcome cost), second payment after submitting income verification report at three month of working (25%) and the remaining 35% after completion of income verification at six months of training.
  
  

Results

• Training schemes using this model can be highly effective. The trainees’ pass rate (as recorded by the National Skill Testing Board) was 80% in 2009.
• Similarly the employment rate was very high post-training at 92%.
• A wide range of training areas have been developed. Trainees working in 49 trades in 2009 included construction, welding, furniture making, embroidery, plumbing, and electricians.
  
  

Lessons learned

• Mobile trainings (trainers travelling to trainees) are helpful and cost-effective in reaching out in geographically isolated regions.
• Differentiated pricing mechanism helps deliver training to the targeted groups more effectively.
• Outcome-based and post financing model has helped to ensure that the fund is utilised as per mandates.
  
  

Potential challenges

• Geographic remoteness makes it difficult for service providers to identify employable trades in those areas that would help the people to generate minimum income of USD$3000/month after the skills training.
• Skills training sometimes did not match the interest and need of the employers.
• Post-training support like linkage to the collateral-free loan and market linkage needs to be strengthened.
• The service providers in the market are mostly output oriented rather than outcome oriented.
• Tracing of the graduates for income reporting, especially those going to India and overseas, is challenging as the graduates change their working place frequently and service providers are not notified.
  
  

For further information contact:

http://www.helvetasnepal.org.np/