Activation Policies for the Poor in OIC Member States

Executive Summary

This study presents research findings on best practice in the use of activation (support for

individuals to move into the labour market) as a tool for poverty alleviation in OIC Member States.

The three activation measures considered in the study are:

Job search support

Training

Job creation

Activation measures are needed in OIC Member States because many OIC Member States do not have

developed social safety net systems. Employment is therefore a pre-requisite for many people to

move out of poverty. In Member States that do have comprehensive social safety net systems, the

use of activation can be used to counteract possible negative incentives jobseekers have to find work

if they are in receipt of social assistance. In this respect, activation also improves the affordability of

social assistance. Broadly, the current view amongst global economists is that activation strategies

have an important role in both mitigating the worse effects of economic shocks and providing a

policy tool for promoting a more equitable labour market and increased employability in the

workforce. However, these gains are dependent on activation strategies which are well-designed and

responsive to changing labour market conditions.

Activation measures are used throughout OIC Member States. The design of these measures varies

by country as they respond to each Member State’s labour market trends and socio-economic

contexts. Key trends experienced by Member States include jobless growth, the need to provide

quality jobs, youth unemployment, skills mismatch, and the need to promote employment in the

private sector. Although the different types of job search support, training and job creation measures

vary in each Member State, certain types of measures are more likely to be used depending on a

Member State’s income grouping. The table below provides examples of measures that may be used

according to a Member State’s income grouping.

Table 1: Examples of Measures According to a Member States’ Income Grouping

Job creation

Training

Job search support

Low

income

These measures may focus on

addressing

immediate

chronic need, e.g. through

public works programmes such

Employment

Guarantee

Schemes.

Low literacy rates mean countries are

expanding access to education. Countries

with higher education levels focus on

vocational skills training for workers.

A lack of data, particularly at a local level,

and poor access to services can typify job

search support. Jobseekers often use

informal networks to find employment.

Lower-

middle

Countries may combine short-

term measures with longer

term promotion of the private

sector.

Training is largely targeted at young

people

due

high

youth

unemployment. In many cases this skills

mismatch is a factor.

Support tends to be present through the

public employment service (PES) although

lack of funding can limit access. Lack of

conditionality

for

jobseekers

and

employers to register also limits impact.

Upper-

middle

There is a longer term focus on

job creation through economic

diversification and the

promotion of skilled industries.

Countries are likely to focus on

developing a skilled workforce in order

to meet needs associated with growing

high skill industries.

A structured PES is likely to collect job

vacancy information, provide counselling

and hold job fairs. Access can be improved

using partner organisations.

High

income

Job creation is targeted at

promoting the private sector to

workers.

Training centres on providing the skills

required by private sector employers in

order to increase the attractiveness of

the national workforce compared to

foreign workers.

There is extensive investment in services,

including a focus on different types of

jobseekers and their needs, e.g. people

with disabilities.

Note: This classification is made by the authors of the study