Youth unemployment—an acute problem in Sub-Saharan Africa—is overwhelmingly considered to have long-term negative implications, both on individuals’ quality of life and on broader socio-economic development outcomes. This study assesses the impact of a government apprenticeship program in Ghana that pairs young people who have limited education with master trainers operating small businesses for a one-year training period. Researchers are evaluating the targeting and recruitment process, the benefits for apprentices and trainers, the program’s cost-effectiveness, and to what extent performance-based incentives increase the quality of training apprentices receive. Results from this study will assist policymakers in Ghana to formulate sound policies to address youth unemployment.
Youth unemployment is an acute problem in low-income countries, and especially in Sub-Saharan Africa.1 Young people account for 60 percent of the unemployed in Sub-Saharan Africa, and 72 percent of young people between the ages of 15 and 24 live below the $2 a day poverty line.2 A lack of necessary skills is often cited as contributing to high unemployment. Job training programs, and in particular apprenticeship training with private-sector informal firms, could expand labor market opportunities for young people by providing them with relevant on-the-job experience and market-ready skills.
Despite their promise, program evaluations of job training programs around the world have been disappointing and job training has been shown to provide mediocre labor market returns on average. One reason for these lackluster effects may be wide variability in the quality of training. In Ghana, as in other poor countries, productivity (and likely, training ability) varies greatly across businesses. In addition, though non-institutional, on-the-job training is otherwise believed to be the most effective option, it potentially introduces new issues where the incentives of training providers may be misaligned with those of trainees or the government agency implementing the program. In particular, apprentices provide low-cost labor to businesses via their on-the-job experience, and this dual role could incentivize training providers to seek to retain apprentices at a skill level that is profitable for the business but makes them less than employable elsewhere.
In 2012, 26 percent of young people in Ghana between the ages of 15 and 24 were unemployed.3 The skills deficit in Ghana is partly driven by an education system in which a large number of students fail to progress beyond junior high school. Access to senior high school is based on performance in national examinations and places are often limited; in 2011/2012 only 50 percent of qualified students transitioned to senior high school, and the gross enrollment ratio for senior high school was only 37 percent.4 The gross enrolment ratio in public technical and vocational training institutions was just 3.5 percent. Limited capacities at government schools and public and private training institutions combined with costly fees prevent many young people from furthering their education and improving their skills.
The National Apprenticeship Program (NAP) is a training program initiated by the Council for Technical and Vocational Education and Training (COTVET), and implemented by district-level coordinators of the Ghana Education Service, in close partnership with craft-specific trade associations. The program is based on the traditional three-year apprenticeship model, which is extremely widespread in Ghana, except that the NAP training period has been shortened to one year in order to reduce the amount of time before apprentices enter the labor market. Similar to the traditional apprenticeship model, COTVET has committed to paying master trainers and to providing a toolkit to each participating apprentice.
The program is mostly targeted at young people who are unable to continue their education beyond Junior High School. Recruitment of both trainees and master trainers was conducted at the district level.
To estimate the returns of the apprenticeship program, and to examine how it can work most effectively, researchers are implementing a randomized evaluation in 32 nationally representative districts across all 10 regions of Ghana. Researchers assigned a random half of the 4,601 applicants to participate in the apprenticeship program. Treatment apprentices were then randomly assigned to master trainers’ businesses that matched their trade and geographic preferences. The businesses and their owners have a wide range of characteristics to enable researchers to measure if there are certain business-level characteristics associated with higher quality training (as measured by self-reported progress throughout the program, and apprentice attendance, retention, and completion) and higher labor market returns upon completion.
Additionally, a random half of master trainers will be offered cash incentives to encourage them to instruct their apprentices well. This additional cash incentive program is designed to encourage trainers to ensure a proficient skill level within the specified time period.