Understanding the implications, challenges and synergies of how the private sector engage in the youth employment arena is a key element in understanding how we can move forward in addressing youth employment challenges.
Public interventions to improve youth labor market outcomes are motivated primarily by the presence of market failures as well as equity concerns.
Active labor Market Programs (AlMPs) are designed to overcome these market failures, but often suffer in turn from “government failure.”
Private sector involvement in youth skills and employment take many forms but can be characterized as variations of public-private partnerships (PPPs).
The motivations for firms and employers to become involved in youth employment programs will vary depending on the nature of the firm, with important implications for policies.
A range of factors constrain firms’ participation in youth employment initiatives, including costs, externalities, and lack of information.
Turning to evidence of effectiveness, evaluations indicate that training interventions that closely involve employers to ensure they are demand driven yield benefits with regard to youth employment or incomes.
The use of private (for-profit) providers to deliver TVET and other job skills training in a managed competitive framework can improve efficiency, quality, and coverage.
Despite the benefits of private sector involvement, engaging employers in training and other youth employment interventions has proved to be a challenge in many cases.
Problems of signaling acquired skills to potential employers are particularly acute for informal training.
While numerous questions for research emerge from this review, an overarching conclusion is that more evaluations of a range of programs are needed.