81674 R E S U LT S S E R I E S   |   J U L 2 0 13 Promoting Youth Entrepreneurship and Employment: The Case of Lao PDR “We’d like to encour- age young people, E ntering into productive work is a challenge for youth in Lao, and the hurdles for young women are particularly acute. Although average labor force that the number of female-headed businesses (both informal and registered formal firms) is increasing, but they tend to be smaller and use less technology particularly young participation rates for men and women are almost than male-owned enterprises. Female entrepreneurs women, to harness equal, there are significant differences across the tend to be younger, less educated, and have fewer their entrepreneurial sexes in the type of work and how this work is assets. Female entrepreneurs are concentrated ideas and engage compensated. Men outnumber women in formal in less lucrative trades (namely retail and textile successfully in small sector employment (although total formal sector manufacturing), whereas male-owned enterprises business activities employment remains extremely low at around 13 are predominantly in services and manufacturing that can provide percent of the active labor force). The majority of other than textiles. Women also report more problems income for their economically active women and girls identify as than men when starting a business; particularly that “unpaid family workers”—64 percent compared to their household duties impose constraints on their families, employ- only 27 percent of economically active men and boys. time and mobility.2,3 ment for their com- Conversely, more than 56 percent of men and boys munities, and the run their own enterprises, compared to 26 percent economic growth of of women and girls.1 the country.” Expanding wage labor opportunities for both Keiko Miwa, men and women, and strengthening business enter- World Bank Country prises are important for economic development in Manager for Lao PDR Lao. Young people—and particularly young women— need support on this front. Some data indicates The STEPS Project STEPS (Supporting Talent, Entrepreneurial Potential A MARKETPLACE COMPETITION and Success) is a pilot project in the World Bank’s TO INCENTIVIZE YOUTH Adolescent Girls Initiative that is being implemented ENTREPRENEURSHIP in two rounds between 2011 and 2013. STEPS is experimenting with two different interventions to The Marketplace competition is implemented in help young people transition to the labor market: partnership with a local business association—the (1) a marketplace competition to promote a culture Young Entrepreneurs Association of Laos (YEAL). of entrepreneurship by identifying and supporting The approach involves a competition to identify good young entrepreneurs who are seeking to start or business ideas, and support to young entrepreneurs expand a business; and (2) career counseling offices through business skills training, mentorship and seed to provide job placement and career counseling grants. The project also aims to build the capacity services to university students. of YEAL to support aspiring young entrepreneurs, 2 A G I   |   R E S U LT S S E R I E S Call for Business included in the second round—Vientiane and Proposals Announced Savannakhet. Project M&E Business (1 month) Proposal The Marketplace Competition launched with a (semi- annually) Review call for proposals for young entrepreneurs to submit (1 month ) their business ideas. Proposals were then reviewed and shortlisted by a selection committee. Youth who were shortlisted received two weeks of certified Business Proposal Business business skills training, on topics such as marketing, Implementation, Training for Follow-up Short-listed finance, business plan development and leader- Marketplace (1 year) Candidates ship. Candidates were then asked to submit revised Competition (10 days) business plans, which were assessed by a technical review panel. Finalists were invited to showcase their Grant business ideas at a two-day Marketplace Exhibition, Disbursed to Technical during which they were interviewed by a panel of Winners; YEAL Review; jurors. Winners were selected to receive small seed Mentorship Finalists grants (start-up or expansion capital ranging from Support for Marketplace Selected Finalists (1 month) USD $1000 to $5000). All finalists received a one Exhibition & Announcement year free membership to YEAL as well as mentorship of Winners support. The project also pursued partnerships with (2 days) local banks in order to facilitate access to financial services for STEPS participants. Results “Through the program particularly young women. Under the STEPS project, The Marketplace model is monitored by follow-up I learned to make YEAL members are trained to become mentors for surveys of the short-listed candidates as well as smarter business new entrepreneurs, and the annual fees are reduced qualitative interviews with key project stakeholders. decisions.” to make membership in the business organization For the first round, a follow-up survey was conducted STEPS Competition more accessible. at seven months and one year after training comple- participant from The Marketplace Competition reached 400 tion. Monitoring results for round one show that Champassak beneficiaries who were recruited from schools, after one year of completing the STEPS training: business associations, vocational training centers, and micro-business communities. The program used • 59 percent of Marketplace participants (more an affirmative action strategy—including proactive than half of whom are female) reported having outreach and explicit gender targets during the started a new business or having expanded a participant selection process—to ensure 50 percent pre-existing business. In total, 21 new businesses female participation in the first round and 70 percent were begun and 20 businesses expanded their in the second round. The competition was organized operations. in provinces where the private sector is relatively • This business growth led to the creation of 140 vibrant. The first round targeted three provincial new full or part-time jobs, 55 percent of which capitals—Vientiane Capital, Luang Prabang and were held by females. Champasak—and two additional provinces were • 76 percent of businesses (including 68 percent of female-run businesses) were profitable. Overall, monitoring results show that the project Round 1 Round 2 met or exceeded its employment and gender targets Key Outputs (Dec 2010–Aug 2011) (Jun 2012–Dec 2013) for the first round. Furthermore, the project has been # of proposals received 212 (67% female-led) 171 (57% female-led) successful at helping YEAL work better with young women; between 2010 and 2012 YEAL membership # of participants trained 96 (59% female) 97 (61% female) increased by 26 percent and the number of female # of business plans submitted 67 (63% female) 67 (67% female) members doubled. However, insights from the qualitative inter- # of finalists 30 (57% female) 30 (73% female) views point to some pervasive obstacles for female # of winners 11 (63% female) 10 (90% female) Marketplace participants. Respondents cited a lack of worldbank.org/gender/agi 3 confidence in business decision-making and a lack of Identify Potential social support compared to their male counterparts; Institutes (3 months) Identify 40 percent of new female owners said business deci- Project M&E Training sions were made by their spouse or another person. (semi- Firm annually) (2 months) Despite women’s overall success in the program, female-led businesses still had a higher failure rate than male-led businesses; 33 percent compared to Counselors 24 percent among male-led businesses. When asked Identified Job Fair Career and Trained why STEPS trainees did not start a new business or Counseling (3 months) expand an existing one, the most common responses Offices among males were that they did not have enough capital. Female respondents echoed the need for HR Workshop Career more capital, but their second most critical barrier & Career Counseling Booklet Offices was a lack of sufficient time. Established (3–5 months) CAREER OFFICES TO SMOOTH THE Advanced Job Readiness TRANSITION TO EMPLOYMENT FOR Training and Training for COLLEGE GRADUATES Study Tour for Students Counselors (quarterly) There is growing recognition of the need for tertiary institutions to help provide job counseling and con- nections to the labor market.4 The STEPS project databases. 488 students (68 percent female) have has supported the creation of two career counsel- received a one-day training in work readiness skills. ing offices (CCOs)—the first of their kind in the More than 5,000 students and nearly 50 private country—to support students in their last year of companies have participated in two job fairs. The studies at the National University of Laos (NUOL) CCOs have expanded their contacts by holding and Pakpasak Technical College (PSTC) in Vientiane. workshops with private sector human resources The schools were chosen because they had a large (HR). Sustainability plans are being developed to female student body, and had expressed an interest integrate the CCOs into school plans and budgets. in and commitment to the CCO. Employment services offered through the CCOs include training in work Results readiness skills, career advice, job placement services Beneficiaries of the CCOs were surveyed at three and and links to internship and employment opportu- nine months after graduation. Surveys found that: nities. The program encourages female students • 47 percent of the graduates registered with the to apply and explicitly recruits female counselors. Career Counseling Office at NUOL (more than In May 2011 24 counselors (including seven half of whom are female) and 44 percent at women) took part in a five-day training. This was Pakpasak Technical College (more than a third followed by individual coaching, two study tours to of whom are female) reported being employed CCOs in Thailand, and a follow-up training work- within one year of graduation. More than half shop. Two CCOs were officially opened in October said they relied on their own contacts to find a 2011, and both offices have established student job, but encouragingly eight percent of NUOL students and 19 percent of PSTC students cited “assistance from the Career Counseling Office”. • 89 percent of NUOL students (85 percent female) and 95 percent of Pakpasak students (96 percent female) obtained an internship within three months of graduation. • Average monthly earning is 1.76 million kip (1.75 million among females) for NUOL students and 825,000 kip (841,000 among females) at the technical college.5 worldbank.org/gender/agi 4 A G I   |   R E S U LT S S E R I E S From Program Results to Policies The STEPS program shows that affirmative and the value of sponsorship increased seven-fold. action plans can work when gender targets are On the other hand, a competition model limits the included in the results framework. The project number of beneficiaries that can be reached and is strategically included male participants knowing likely to bypass more vulnerable populations. that it would be important for women to be able Establishing Career Counseling Offices can to apply in partnership with their male associates. help bridge the critical link between education To meet the gender targets, it is important that institutions and the labor market. Students need outreach materials explicitly encourage women to a place where they can go to get targeted career apply. Mobile clinics and social media were key advice and job preparation support. At the same tools for reaching women. Project monitoring data time companies need a focal point at schools with affirms that young women have benefitted at least whom they can build relationships to improve their equally, if not more so, from most project activities recruitment, job matching and retention practices. “I am really interested as compared to male participants. Education policies that support the replication or in business STEPS has also shown that business orga- scale-up of such services can go a long way to management so I nizations can be made more inclusive for young improving the transition between school and work. was thrilled to meet women by providing mentoring services to build Broader efforts to further advance female many new people women’s confidence to be business decision- participation in the Lao labor force should address that I could learn makers and by making membership affordable. women’s time constraints. Available data sug- from, and who knew Business organizations should consider providing gests that women’s time and mobility constraints a lot about business personalized support services such as mentoring to stemming from their greater share of household management.” help build the capacity and confidence of female duties prevents them from enjoying equal access STEPS Competition entrepreneurs, who may be disadvantaged by fewer to paid work. entrant resources, smaller networks, and social stigma. It Going forward, the emphasis for both is also good practice for business organizations to the Marketplace Competition and the Career link registration fees to business size—this is likely Counseling Offices will be on promoting sustain- to benefit women who tend to have smaller busi- ability. In the coming year the project will launch nesses and less capital. another round of the Marketplace Competition A Marketplace competition can be an effec- and seek ways to integrate the model within larger tive way to foster public-private partnerships and World Bank, YEAL and/or Government programs. support the most promising entrepreneurs. The The project will also work with NUOL and Pakpasak Marketplace competition strengthens the supply of Technical College to support the Career Counseling skilled youth and helps connect them to the private Offices for the coming school year and help integrate sector. Private sector response to STEPS has been them within school plans and budgets for longer- positive; over the course of the project cycle the term sustainability. number of sponsors increased from five to seven Endnotes 1. Asian Development Bank and the World Bank. 2012. 4. OECD. 2004. Career Guidance and Public Policy: Bridging Country Gender Assessment for Lao PDR: Reducing the Gap. Paris: OECD. Vulnerability and Increasing Opportunity. Philippines and 5. Earnings are approximately on par with those of technical Washington DC: ABD and WB. vocational education training (TVET) graduates who were 2. Ibid. tracked in a recent World Bank tracer study (the reported 3. The World Bank. 2008. Opportunities and Constraints for salary range was 760,000 to 1,150,000 kip, depending on the Economic Empowerment of Adolescent Girls and Young the sector). Women in Lao PDR. The World Bank’s partners in the AGI are the Nike Foundation and the governments of Afghanistan, Australia, Denmark, Jordan, Lao People’s Democratic Republic, Liberia, Nepal, Norway, Rwanda, Southern Sudan, Sweden, and the United Kingdom. This brief features work by the World Bank’s Gender and Development Department in the Poverty Reduction and Economic Management (PREM) Network . For more information about the AGI please visit www.worldbank.org/gender/agi. 1400404