Publication: Can Cash Grants Help Create Jobs and Stability?
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2011-12
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2014-02-19
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Policymakers throughout the world struggle to boost employment. Creating jobs or giving people the right training to get jobs is not only good economics, but especially in developing countries, it may be a way to reduce social instability and with it the threat of crime and unrest. In the push to figure out what works, development organizations and governments are looking beyond the more traditional voucher and microfinance tools to decentralized programs that give cash grants and leave it to recipients to decide how to use the money. At the World Bank, committed to ending poverty and we are working to help meet the United Nations millennium development goals, including eradicating extreme poverty by raising incomes and making sure everyone has decent employment. To help policymakers judge the effectiveness of different approaches to building employment opportunities, the World Bank sponsored an evaluation of a Government of Uganda program that gave young men and women cash grants to start new businesses or get training. Based on mid-term results two years after the intervention, the Ugandan program made significant impacts: Beneficiaries reported large increases in skilled employment and incomes, and modest gains in social cohesion and stability. Researchers and Innovations for Poverty Action (IPA) partnered with the Ugandan government to evaluate the effectiveness of the youth opportunities program, introduced in 2006 to raise incomes and employment among young adults aged 16 to 35 in the country's northern region by offering them cash grants for training and busi-ness materials. To qualify, young adults had to organize in groups of 10 to 30 people and submit a proposal for a grant to cover training programs and what tools and materials they needed to run a business. Helping young adults find jobs is a key goal of policymakers in emerging economies, where high rates of unemployment are a potential social and economic problem. Many countries are working with vouchers, training programs and microfinance to raise employment opportunities. Uganda, which over the past decade emerged from a brutal armed conflict in the north, has been working to alleviate poverty and raise jobs options in this hard-hit region. In a new approach, the government funded a program that gave unsupervised cash grants to young adults who drew up business plans explaining what they would do with the money.
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“World Bank. 2011. Can Cash Grants Help Create Jobs and Stability?. From evidence to policy;. © http://hdl.handle.net/10986/17111 License: CC BY 3.0 IGO.”
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