Abstract: One third of the 420 million young people in Africa are unemployed. Understanding how youth search for jobs and what affects their ability to find good jobs is of paramount importance. We do so using a field experiment tracking young, urban job seekers for six years in Uganda’s main cities. We examine how the following kinds of standard labor market interventions impact their search for good jobs: vocational training, vocational training combined with an offer to match workers to firms, and match offers only. Training is offered in sectors with high quality firms. The matching intervention is a light touch offer to match workers for interviews with such firms. At baseline, youth are unskilled yet optimistic about their job prospects, especially over the job offer arrival rate from high quality firms. Relative to controls, those offered vocational training become even more optimistic, search more intensively and direct their search towards high quality firms. However, for youth additionally offered matching, expectations are revised downwards because call back rates from firms are far lower than their prior. These differential expectations and search behaviors impact long run outcomes: vocational trainees without match offers have higher employment rates in good sectors and end up matched to higher quality firms than youth additionally offered matching. Our analysis highlights the foundational but separate roles of skills and expectations in job search, how interventions cause youth to become optimistic or discouraged, and how this matters for long run sorting in the labor market. Joint with Oriana Bandiera, Vittorio Bassi, Robin Burgess, Munshi Sulaiman, and Anna Vitali.

Organizers:

Benoît SCHMUTZ (Pôle d’économie du CREST)
Anthony STRITTMATTER (Pôle d’économie du CREST)
Sponsors:
CREST

Abstract: One third of the 420 million young people in Africa are unemployed. Understanding how youth search for jobs and what affects their ability to find good jobs is of paramount importance. We do so using a field experiment tracking young, urban job seekers for six years in Uganda’s main cities. We examine how the following kinds of standard labor market interventions impact their search for good jobs: vocational training, vocational training combined with an offer to match workers to firms, and match offers only. Training is offered in sectors with high quality firms. The matching intervention is a light touch offer to match workers for interviews with such firms. At baseline, youth are unskilled yet optimistic about their job prospects, especially over the job offer arrival rate from high quality firms. Relative to controls, those offered vocational training become even more optimistic, search more intensively and direct their search towards high quality firms. However, for youth additionally offered matching, expectations are revised downwards because call back rates from firms are far lower than their prior. These differential expectations and search behaviors impact long run outcomes: vocational trainees without match offers have higher employment rates in good sectors and end up matched to higher quality firms than youth additionally offered matching. Our analysis highlights the foundational but separate roles of skills and expectations in job search, how interventions cause youth to become optimistic or discouraged, and how this matters for long run sorting in the labor market. Joint with Oriana Bandiera, Vittorio Bassi, Robin Burgess, Munshi Sulaiman, and Anna Vitali.

Organizers:

Benoît SCHMUTZ (Pôle d’économie du CREST)
Anthony STRITTMATTER (Pôle d’économie du CREST)
Sponsors:
CREST