Using Income-Generating Activities to Educate Students for a Global Economy through 100% Market-Driven Education

Abstract

According to the 2007 World Development Report, “early difficulties in finding employment can have long-lasting effects on employment later in life” (World Bank 2007: 99) Emerging research shows that “the ability to understand and respond to market information is central to the success of youth workforce and enterprise development” (Macaulay and Meissner 2009: 5).

Youth workforce development programs are increasingly taking more market-driven approaches. Youth workforce training programs aim to help 100 percent of their graduates find jobs. The best way to achieve this is for programs to be part of the market system themselves — by having youth sell the goods and services that they are learning to produce or by selling their program’s services to future employers of their youth trainees. They can also ensure that program instructors have first-hand exposure to the needs of the marketplace by, for example, conducting market research. These mechanisms also become more rigorous in ensuring that programs are fully responsive to market demand — “100% market-driven” — when they are an integral part of the institutions’ strategies for achieving financial sustainability. Market-driven programs find, read, and respond to signals from the broad economic market. These signals include not only those about product supply and demand but also those about the job skills demanded by employers.

This article explains how income-generating activities help ensure market orientation and improve the ability of students or trainees to find employment. It also outlines six benefits of market engagement: creating a “reality check,” measuring program quality, improving the skills of teachers and trainers, identifying new market niches or funders, forming links with private-sector actors, and generating funding to cover costs. The article provides lessons from practitioners that can be applied to other youth education programs.

The case example of two organizations, Fundación Paraguaya and Partners of the Americas, are used to articulate this approach. Both Fundación Paraguaya and Partners of the Americas operate youth-workforce development programs that actively participate in the market, selling the same goods and services that they train their students to provide and/or selling their own services as effective trainers of youth, as a way of both overcoming resource constraints and ensuring program quality and relevance.

Both Fundación Paraguaya and Partners of the Americas had strong financial reasons to adopt this approach. For Fundación Paraguaya, the inspiration grew out of the goal that its programs should be able to cover 100 percent of operating costs within five years. For Partners of the Americas (POA), the impetus came from an opportunity to access financing from the Multilateral Investment Fund of the Inter-American Development Bank (IDB). As this article explains, the drive to have these programs generate some or all of their own resources — and the consequent imperative that they be “100% market-driven” — has had effects beyond the financial bottom line and has led to improved quality and relevance of both organizations’ youth-workforce development programs.