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Labor market assessments pinpoint employment and technical education needs in Latin America and the Caribbean

July 11, 2017

Across Latin America and the Caribbean, countries are facing a workforce skills crisis. The World Bank reports that more than 20 million youth in Latin America and the Caribbean ages 15 to 24 are neither working nor in school, and the unemployment rate for this age group is almost 17 percent. Yet, companies are unable to fill key positions. Employers cite a lack of applicants with the relevant skills as a significant obstacle to boosting their productivity. One of the main drivers of this disconnect is that higher education institutions are not adequately preparing students to meet employer needs.

student smiling with backpackThrough the Advance program, FHI 360 bridges the gap between labor market supply (education) and demand (employers) by strengthening two-year post-secondary technical degree programs in three countries: Guatemala, Honduras and Jamaica. Over the course of five years, this program will partner with up to nine technical tertiary institutions in these countries to prepare graduates to enter the workforce with the skills needed to succeed. The program is funded by the U.S. Agency for International Development.

Labor market assessments

The Advance program conducted a labor market assessment in each country to select the focus institutions and degree programs. The program adapted FHI 360’s customizable labor market assessment framework, which was developed through the Workforce Connections project, to evaluate market demand for skills. Unlike other labor market assessment methodologies that require detailed employment data by sector, our framework starts from the demand-side perspective, using a blend of existing quantitative data and qualitative data gathered through employer interviews, a methodology that is ideally suited for data-poor environments. Advance’s assessments not only introduced this innovative methodology to local stakeholders, but they also produced important findings to inform upcoming program activities.

Advance used the findings from these assessments to select three to five priority growth sectors per country. The program team applied a stakeholder mapping methodology to identify and interview key public and private-sector actors in each priority sector. The program then synthesized key findings into value chains to illustrate employer skills demands, employment entry points and technical education needs that the program could strengthen within each priority growth sector.

Common priority sectors across countries

Across the three countries, Advance identified 13 priority sectors, ranging from textiles in Guatemala to health services in Honduras to creative industries in Jamaica. Two sectors, tourism and agribusiness, emerged as priorities in all three countries, each with its corresponding set of common technical education and skills needs.

Tourism needs soft skills

In the tourism sector, where consistent, high-quality customer service is integral to success, Advance found that employers in all three countries emphasized the need for soft skills, such as confidence, self-esteem, professional ethics and motivation. This finding is consistent with FHI 360’s recent research on the hierarchy of critical skills in Latin American and the Caribbean, which found that both employers and educators identify socioemotional skills as the primary skills needed for employability. The program also identified a need to integrate soft skill development in high-demand technical degree programs, such as marketing, sales and business administration, as well as culinary programs for aspiring executive chefs, food stylists and kitchen support staff. (See the Jamaica health and wellness tourism value chain for an example of Advance’s tourism sector analysis.)

Agribusiness requires technical skills

In the agribusiness sector, Advance identified a need for technical skills, such as food processing, logistics and marketing, and entrepreneurship, which will allow agribusiness employers in all three countries to meet growing international demand for high-quality products. Accordingly, the program identified a need to strengthen technical degree programs in food science, agricultural production, farm administration and agricultural marketing, among others. (See the Honduras coffee value chain for an example of Advance’s agribusiness sector analysis.)

Sharing findings with stakeholders

In each country, Advance shared its key findings from the labor market assessments and highlighted its innovative methodologies at public launch events, which drew stakeholders representing a variety of public, private and academic institutions. Participants were excited about how these tools could help close the skills gap. One academic professional stated, “For us, as a university that produces technical graduates, the study is fundamental; it can be used as a methodological base to keep building [knowledge in this area].”

To complement the labor market assessments from Guatemala, Honduras and Jamaica, Advance will soon release a regional report that synthesizes these results and provides a deeper analysis of potential areas of employment across the region.

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