52680 Enhancing the Employment Chances of Roma Christian Bodewig and Lucia Kureková Roma communities in central and southeastern Europe have Roma: Distanced from the Labor Market a history of being excluded from the labor market and still There are several dimensions to the bad labor market face severe barriers to employment. Besides being outcomes for Roma: marginalized socially, Roma were typically the first to lose their jobs at the outset of the post-communist transition. · Non-participation of the Roma in the labor market is Many in their next generation grew up in unemployed often best characterized as lack of labor market households, with low educational attainments and limited job participation rather than unemployment. As in the Czech skills. The labor market exclusion of Roma persisted even Republic, the majority of working-age Roma are through the years of buoyant economic growth and discouraged workers who are out of the labor force increasing employment levels prior to the economic because they have given up looking for jobs after an slowdown triggered by the global financial crisis in 2008. unsuccessful search. Many governments in central and southeastern Europe are Figure 2: Czech Roma by Labor Market Status, 2008 trying to address the unemployment problem of Roma and Roma population in working age by labor force status, 2008 other disadvantaged groups by introducing measures to restrict or cut welfare benefit entitlements, so as to 26.9 strengthen incentives to work. However, research by the World Bank and others shows that simply cutting benefits is unlikely to result in higher employment--the labor market exclusion and social marginalization of Roma is a 55.8 multifaceted issue, and their communities face 12.2 multidimensional barriers to employment. 5.2 A more effective way to promote employment among Roma Employed Casually employed Unemployed Not in labor force (and other disadvantaged groups) is the employment Source: World Bank, 2008 activation approach increasingly being introduced across · Those Roma who are employed, often have low many countries in the European Union and the OECD. This quality jobs, such as, low-paying, high turnover or approach balances the mutual obligations of jobseekers and casual jobs. state employment offices in order to secure the successful integration of the most disadvantaged workers. Figure 3: Roma Employment Patterns in Serbia, 2003 Figure 1: System of Mutual Obligations and Incentives 100% Jobseeker State seasonal job 80% Be available for work More focused, part-time job individualized service 60% Percent Regularly visit the BALANCE from the Labor Office full time job, but without Labor Office 40% social insurance Address multiple disadvantages, working on contract Participate in active e.g. debt 20% labor market and full time job retraining programs Culturally sensitive service 0% provision Roma General Ensure that "work pays" Population Source: World Bank, 2008 Source: Bodewig and Sethi, 2005 ECA Knowledge Brief March 2009, Volume 2 · Large numbers of Roma have severely low Figure 5: Czech Republic: Social Benefit Recipients in educational attainments and are often lacking even in Marginalized Localities, 2008 functional literacy. · There is a strong gender dimension to Roma labor 100% market participation. Roma women generally participate 80% 35 49 in the labor market to a significantly lesser extent and have lower literacy rates and educational attainments. 60% 40% Figure 4: Southeast Europe--Employment Rates for 65 51 Roma by Sex, 2004 20% 80 0% 70 67 61 Roma Non-Roma 58 59 60 social benefit recipients non-recipients 47 48 50 44 Source: World Bank, 2008 40 34 33 26 30 20 20 Heavy indebtedness: A debt trap is an additional barrier 17 20 16 to labor market participation for many Roma. High rates 10 of and widespread indebtedness mean that the effect of 0 potential higher income is immediately diluted--the Croatia Montenegro Bulgaria Romania Bosnia and Serbia Albania earnings would have to be used to repay family debts Herzegovina rather than for improving living standards. Debt traps Men Women not only decrease people's motivation to work but also Source: UNDP, 2006 intensify poverty and social exclusion. · Due to the conflicts in former Yugoslavia, thousands Figure 6: Southeast Europe--Outstanding Debt as a of Roma in southeast Europe have been displaced and Percentage of Monthly Household Expenditure, 2004 continue to lack legal personal identity documents. This 1400 prevents them from asserting several social rights in 1200 employment, education, health, social care, etc. 1000 800 Barriers to Labor Market Participation of Roma 600 400 Barriers on the Side of the Jobless 200 Limited skills: Educational attainment, functional 0 Roma Majority literacy and previous work experience are the key poor non-poor predictors of success in labor market participation--the Source: UNDP, 2006 majority of Roma fare poorly on all these counts and the situation appears to be worsening among their younger generations. The type and level of skills which most Barriers on the Side of the Employers Roma have are insufficient for the needs of the increasingly knowledge-based economies in central and Low demand for low-skilled workers: In spite of southeastern Europe. increased job vacancies in many countries across central and southeastern Europe in the period prior to the Welfare trap: In some countries, many Roma are highly economic crisis, the demand for workers in elementary dependent on social and welfare benefits. In situations occupations was very low relative to the supply of low- where welfare benefits are equal to the earnings from skilled workers. Emerging vacancies usually require minimum wages (the income many working Roma are different and higher skills than those many Roma likely to get due to their skill levels), the incentives to possess, significantly limiting the opportunities available participate in the labor market are decreasing. Further, to them. While systematic discrimination likely plays a informal income from casual work is often preferred, not role in the labor market exclusion of the Roma, research least because it provides scope to avoid debt repayment. in the Czech Republic suggests that lack of skills and prior work experience may be greater barriers. ECA Knowledge Brief March 2009, Volume 2 Other Labor Market Barriers Given the complexity of the problem, one-sided policy measures which concentrate only on the jobseekers' Many Roma continue to live in segregated settlements in responsibilities are unlikely to lead to the social poor housing conditions--this feeds into a series of inclusion of Roma or to lift them out of poverty. A true additional constraints which hamper the labor market mutual balance of obligations and incentives between integration of the Roma. For example, limited finances the jobseekers and the states (through the public for traveling or moving result in a weak capacity to employment services) is needed. Also, even with the commute or to relocate where work exists. Lack of child best of policies, not every unemployed person is care infrastructure near marginalized communities often `activable'. It is important to ensure that sanctions on prevents Roma parents, especially women, from entering benefits directed towards jobless adults do not adversely the labor market. impact families, in particular children. Can `Employment Activation' Help Integrate Making `Employment Activation' Work for the Roma into the Labor Force? Roma In spite of the complexity of the challenge, there is scope Action 1: Reforming PES Management for better employment outcomes for disadvantaged Roma. There is evidence that prior employment Currently, labor offices in many countries across central experience decreases the risk of joblessness, as does and southeastern Europe are ill-equipped to deal with vocational training. Significantly, in a recent World disadvantaged job seekers such as Roma. In some Bank survey in the Czech Republic, most Roma said that countries, the labor offices function as registration they relied on labor offices to find employment. offices for the unemployed rather than as intermediaries However, smaller numbers of long-term unemployed between the jobseekers and the private sector. Additional and less-educated workers participate in active labor shortcomings include identical services for every market policy programs in the Czech Republic compared jobseeker instead of differentiating based on the level of with higher-educated and previously employed disadvantage, few staff members involved in direct jobseekers. counseling, lack of culturally sensitive services, narrow understanding of labor market barriers, and helplessness Figure 7: Czech Republic--Roma Registered with and lack of motivation on the part of job counselors. Labor Office Who Received Job Search Assistance by Labor Force Status, 2008 Figure 8: Slovakia--Unemployed Roma Evaluation of 80 the Assistance of the Labor Office in Finding 70 Employment, 2004-2005(by settlement type in %) 60 % 50 Segregated Separated Mixed 40 Very helpful 4.3 2.4 4.3 30 Somewhat helpful 19.5 21.1 24.4 Neither helpful nor 20 unhelpful 23.8 19.9 15.8 10 Not helpful 23.1 36.2 29 0 Not helpful at all 25.3 17.1 22.1 Don't know 4 3.3 4.3 Employed Unemployed Discouraged Not in labor force Roma unemployed total 100 100 100 Source: UNDP, 2007 Source: World Bank, 2008 Many countries across the EU and OECD have In order to effectively support disadvantaged jobseekers, successfully introduced `activation' elements into their attention and resources need to be directed towards social protection and employment policy frameworks. enhancing employment offices` capabilities and These elements largely consist of two associated parts: (a) instruments, such as: re-adjustment of social benefits levels to correspond better to wage levels so that participating in the job market Profiling of jobseekers based on their distance from `pays', along with a requirement for regular cooperation labor markets. Profiling involves assessing the with the public employment services (PES); (b) more backgrounds and employability levels of jobseekers and effective and focused support by the PES' for then categorizing them according to their distance from disadvantaged jobseekers, including special programs and the labor markets. This will allow resources to be approaches toward the long-term unemployed. directed towards hard-to-place workers, rather than pursuing a one-size-fits-all approach. ECA Knowledge Brief March 2009, Volume 2 More individualized approach towards the long-term The private sector should be included in pilot unemployed. Mandatory individual activation agreements, apprenticeship and internship programs, as well as tailored to the specific needs and handicaps of individual employment of low qualified and disadvantaged jobseekers, can enhance the effectiveness of labor services workers. Monetary incentives could be given to private by devising individual pathways to employment and enterprises to employ and re-train prime-age Roma and acknowledging various social needs. provide training opportunities to Roma youth. This approach is more likely to ensure that training and skills New management and administrative approaches in development are tailored to labor market needs, while the PES. Greater specialization and training of the staff securing formal employment for Roma for longer will improve their capacity to deal with hard-to-place periods of time. clients. Action 3: Pilot-Test and Evaluate Service integration. Practices like merging labor offices with social welfare offices or introducing There is no single or certain solution to effectively integrated computer systems acknowledge that improving Roma employment. Countries across the jobseekers have multiple needs which are best addressed OECD and EU have been dealing with the challenges of in an integrated manner. Such practices also exploit long-term unemployment for years and have synergies and generate savings. continuously introduced and tested new approaches by piloting promising new programs (funded by budget Development of partnerships. Effective partnerships resources or EU structural or pre-accession funds). The and service outsourcing are important for modernizing impact of these programs is then rigorously evaluated and improving PES. Long-term unemployed and before scaling up or rolling them out nationally. disadvantaged workers require highly individualized and time-intensive services. These services can often be Regardless of the approach chosen, it is crucial to focus provided more efficiently by NGOs that possess stronger on two aspects: integrating Roma youth into the labor context-specific knowledge, tools and credibility in the markets and preventing the next generation of Roma Roma communities. However, labor offices will have to from being excluded. More efforts are needed to address build capacity in effective contracting and monitoring in Roma schooling from early childhood onwards, order to issue performance-based contracts. complemented by early interventions, such as identifying at-risk students, introducing early Action 2: Improving Active Labor Market Policies professional orientation in school, and providing and Programs monetary incentives to remain in school or in training beyond the age of fifteen. In addition to reforming PES management and job counseling, active labor market policies and programs References Bodewig and Sethi (2005), Poverty, Social Exclusion and Ethnicity in should be redesigned as needed: Serbia and Montenegro: The Case of the Roma, World Bank. UNDP (2006), At Risk Roma and the Displaced in Southeast Europe, Retraining. Second chance education and literacy UNDP Regional Bureau for Europe and CIS. enhancement of prime-age Roma are essential for UNDP (2007), Report on the Living Conditions of Roma in Slovakia, improving their competitiveness in the labor market. UNDP Regional Bureau for Europe and CIS. However, education and training programs work best if World Bank (2008), Czech Republic: Improving Employment tied to subsequent employment. Chances of the Roma. Report No. 46120 CZ. Community employment with increased emphasis on About the Authors skills training elements. Public works programs, an Christian Bodewig, Senior Economist, ECA Human important form of intervention for the Roma Development Sector Unit; Lucia Kureková, Central unemployed, must emphasize substantive skill European University, Department of International Relations enhancement and strategic vocational skill upgrading. and European Studies "ECA Knowledge Brief" is a regular series of notes highlighting recent analyses, good practices and lessons learned from the development work program of the World Bank's Europe and Central Asia Region http://www.worldbank.org/eca