A win-win-win program for the government, the private sector and youth
SAN PEDRO SULA, Honduras – Until not too long ago, Rony Barahona used to wake up at 4 am every day to join the lines of job seekers outside factories in the outskirts of this city, the Honduran industrial capital. Although smart and able-bodied, the 21-year-old would return home empty handed, with no money to support himself or his beloved mother.
Honduras is one of the poorest countries in Latin America. About 65 percent of its 8 million people live in poverty. Informality prevails in its labor market, affecting particularly the young, women and persons with limited education.
Rony’s prospects improved dramatically in 2011 after he was selected by the Honduran Maquila Association to participate in a job placement program run by the Ministry of Labor and Social Security. After three months of on-the-job training, Rony got a job at Honduras Electrical Distribution Systems, where he supervises and trains new employees in an electric wiring unit.
“Now, with a stable source of income and benefits, I can provide for my family and plan for my future. I want to study engineering to grow professionally and my company supports me. I am grateful for the opportunity I was given through the program,” Rony smiles with gentle and hopeful eyes.
Alliance yields results
Rony is among the 12,500 young Hondurans who took part in PROEMPLEO, the program supported by the Inter-American Development Bank (IDB) as a part of $30.6 million secondary education project from 2004 to 2011. The goal of the program was to boost job opportunities for unemployed and underemployed people aged 18 to 29.
A strategic alliance with the private sector enabled the program to achieve a high job placement rate of over 77 percent. Out of all the young people who went through the program, 9,607 obtained a steady job with benefits at the companies where they interned at the end of their training. More than half the beneficiaries were women. Trainees also received a certificate for their future job searches.
The program was developed by the Labor Ministry in partnership with the Honduran Maquila Association, the Chambers of Commerce and Industry of Tegucigalpa and Puerto Cortes and others, with IDB support. The business association played a crucial role in promoting the program among companies with vacant positions as well as in identifying young people with matching profiles for the jobs.
Training was funded and tailored by each participating firm to help trainees develop technical skills required for specific occupations as well as to learn good work habits and social skills needed in the workplace, such as clear communication, problem solving, logical reasoning, and team work. The ministry subsidized stipends and insurance for work-related accidents for up to three months while the youth were in training.
“Traditionally, supply-side based employment programs run by public institutions were not effective because they failed to bridge the mismatch between young people’s skills and those sought by the job market. PROEMPLEO placed a strong emphasis on demand-driven skills training, which were literally built into the program through agreements with the private sector to provide both internships and staff jobs to their trainees,” says Roberto Flores Lima, an IDB lead specialist in labor markets and the project’s team leader.
PROEMPLEO served over 250 companies across Honduras in all industries, from manufacturing to trade and services, providing access to well-trained personnel, resulting in a reduction of training costs. It also helped cushion the impact of the global economic downturn, which has taken a heavy toll on the maquila industry.
“The industry has lost more than 8,000 jobs in 2011. Without PROEMPLEO, job losses would have been at least 11,000 or more,” says Martha Benavides, technical director of administration services at the maquila association, which coordinated the employment of more than 3,000 youth through the program.
PROEMPLEO has also yielded positive impacts in some participating firms. D’Castro, a manufacturer of cleaning and personal care products in Tegucigalpa, dramatically increased its productivity by hiring a handful of dedicated young employees through the program.
“We used to produce about 100 bottles of chemicals per a day but now we have a daily production capacity of up to 3,000 bottles. The program has been great for our business but more importantly it gives us an opportunity to help develop the next generation of our country. I continue to share my knowledge and skills with them and encourage them to continue their education so that they will be able to advance their careers and run their own businesses in the future,” said David Castro, president of the firm.
Next Steps
The Ministry of Labor and Social Security recently held PROEMPLEO’s closing workshop, sharing its successful outcomes with government authorities, beneficiaries and key partners of the program, including IDB officials.
“We end this phase of PROEMPLEO with successful achievements. It is truly a win-win-win program for the government, the private sector and young people seeking job. We are grateful to the IDB for its dedication and support throughout the process,” said Labor Minister Felicito Ávila.
“We plan to make PROEMPLEO the country’s national program, with budget for next year,” Honduran Vice President María Antonieta de Bográn said, delivering a message from Honduran President Porfirio Lobo.
“The IDB will continue to support PROEMPLEO through technical cooperation in order to help the government enhance the program’s effectiveness and to create more real job opportunities for young people to enjoy their full rights of citizenship,” added Flores.
Jobs Service Center
The workshop also marked the launch of the Honduran National Employment Service (SENAEH), established to link people looking for work with domestic and overseas organizations in need of workers. SENAEH currently consists of 15 employment offices managed and supported by the Labor Ministry. Nine of those offices are located at the headquarters of business organizations that provide staff and cover operational expenses.
SENAEH offices provide career orientation and counseling; training, and access to equipment such as computers. They also run an electronic jobs database, EMPLEATE, which has already registered 24,000 job seekers and some 15,000 vacancies posted by 10 companies in 2011, making it possible to dramatically increase the rate of successful matches.