Evaluation of the Non-Formal Skills Development Sub-Activity of the Millennium Challenge Corporation's Compact with the Government of El Salvador

Abstract

This report presents labor market outcomes for participants in the Non-Formal Skills Development Sub-Activity of the Millennium Fund of El Salvador (FOMILENIO). This Sub- Activity was a component of the Millennium Challeng Corporation’s (MCC) compact with the government of El Salvador, a $461 million initiative in effect from 2007 to 2012. The compact was designed to fuel economic growth and reduce poverty in El Salvador’s Northern Zone by improving human and physical capital, increasing production and employment, and reducing travel cost and time within the country and within Central America more broadly. The compact had three main projects: (1) the Human Development Project, (2) the Productive Development Project, and (3) the Connectivity Project. The Human Development Project, which involved a total investment of $84 million, encompassed the following two activities: (1) the Education and Training Activity, which invested nearly $28 million (USD) to increase the quality of and access to professional and technical education and training; and (2) the Community Development Activity, which was designed to expand access to sanitation facilities, electricity, potable water services, and community infrastructure in El Salvador’s Northern Zone. The Education and Training Activity was expected to improve the technical skills of Northern Zone resid nts through formal and non-formal training. The Non-Formal Skills Development Sub-Activity, whic was part of the Education and Training Activity, represented a $4.1 million investment in short-term training courses. The Non-Formal Skills Development Sub-Activity was designed to provide short-term training to vulnerable populations in El Salvador’s Northern Zone who were unable or unlikely to seek formal education. According to the MCC–El Salvador compact, this included women, at-risk youth, and the poor. The Sub-Activity funded short-te m courses throughout the Northern Zone in common trades, such as tailoring, baking, and electrical installations. The short-term goal of the Sub-Activity was to increase the education and skill levels of at-risk populations in the Northern Zone. Medium-term goals were to decrease economic barriers to labor force entry while increasing personal income, labor market participation, and self-employment rates of vulnerable populations. Finally, the Sub-Activity’s long-term goal was to spur economic growth and reduce poverty in the Northern Zone. To support participants in these courses, as well as other educational programs offered through the Human Development Project, FOMILENIO developed and implemented the Job Placement and Sustainable Self-Employment Plan ( ILAS, in Spanish) as a complement to the Sub-Activity. PILAS provided job placement support for participants seeking self-employment or traditional employment. From 2011 to 2012, over 10 percent of participants in the Sub-Activity also participated in PILAS. Table ES.1 summarizes th key characteristics of the Sub-Activity.