This evaluation assessed the adequacy of the analytical underpinning and operational relevance of the IDA jobs strategy. IEG examined its effects on a portfolio of interventions implemented by the World Bank that directly supported jobs-related objectives.

The IDA17 Replenishment cycle marked a turning point in the World Bank’s jobs agenda. Until then, jobs were seen primarily as the by-product of growth, and the main objective was to pursue jobs growth. In IDA17, jobs became a special theme, with an explicit recognition of the critical role played by labor markets in intermediating growth and inclusion. Since then, IDA Replenishments have had what this evaluation terms an “IDA jobs strategy,” with explicit objectives, a series of policy commitments to achieve them, and results indicators to track them.

This evaluation is IEG’s first stage in tackling the jobs agenda. It focuses on the operational relevance of the evolving IDA jobs strategy and its translation into World Bank support to jobs through labor supply, demand, and flexibility interventions that directly affect the labor market. This evaluation did not assess the rest of the jobs and economic transformation agenda or indirect support to jobs through private sector growth. The work of IFC in support of jobs through the IDA Private Sector Window was also outside the scope of this evaluation. A total of 257 projects were identified that contained jobs interventions between FY15 and FY22, for which only 18 IPF and 15 development policy financing Implementation Completion and Results Report Reviews were available.

IEG found that the shift in the IDA jobs strategy had a strong analytical underpinning and successfully stimulated country analytics—through the introduction and rollout of country jobs diagnostics—to bridge important knowledge gaps. In turn, the feedback loop between the country evidence and the subsequent adjustment to the IDA jobs strategy was strong. The strategy had a discernible effect on country strategies, which now better articulate their jobs objectives and the theories of change to achieve them. However, this is not yet fully reflected in the operationalization of country strategies. The jobs agenda also became more central to engagement with FCV countries, especially to promote youth employment as a key mechanism for social stability.

However, the IDA jobs strategy’s promises of improved results measurement have not yet been fulfilled. Although impact evaluations are more frequent, results frameworks continue to track outputs rather than outcomes, and many countries’ lack comprehensive labor market statistics. There is an inherent tension between the IDA jobs strategy’s ambition of better capturing jobs outcomes and the systems and incentives underlying results frameworks. Although IDA Results Measurement System Tier 2 indicators capture intermediate outcomes from IDA financing,1 at the project level, teams may be discouraged from including appropriate outcome-level indicators in results frameworks, partly over concerns about attribution. Drawing on the experience with improving the focus on gender in operations, IDA Results Measurement System Tier 3 indicators could also better capture how well IDA operations articulate and track contributions to jobs outcomes. World Bank analysis has also highlighted some of the technical difficulties in estimating the indirect impact of IDA’s interventions on jobs created, which is complex and data intensive.2

The enhanced focus on jobs in IDA’s strategy has been associated with a slight increase in the size of the jobs portfolio funded by IDA. The share of total IDA commitments that went to projects supporting jobs averaged 13 percent. However, not all components in jobs-relevant projects were focused on jobs. IEG estimated that about 60 percent of commitment amounts in jobs-related projects were used for jobs interventions, averaging 8 percent of the IDA commitment amount.

The use of development policy financing prior actions in direct support of jobs-related objectives has increased steadily. However, they remain infrequent and had impact in only one-third of validated operations.

The IDA jobs strategy has led to a more substantial change in the mix of interventions. Demand-side interventions, such as business development and agriculture value chain support, have become more commonplace. The prioritization of youth and women’s employment in the IDA jobs strategy also resulted in a focus on these two beneficiary groups in jobs interventions. However, despite a growing body of evidence from impact evaluations, interventions that specifically seek to improve women’s employment remain rare in the portfolio, whereas youth employment projects are more common.

Working across GPs to fully integrate supply- and demand-side interventions—as recommended by jobs diagnostics—has been hard to translate into operations. In line with the evidence literature, bundling labor demand and labor supply interventions has now become common practice in the portfolio. However, the portfolio review revealed that various GPs continue to target different beneficiary pools and pursue different jobs-related objectives rather than exploiting synergies and seeking scale. The extent of estimated cross-GP collaboration for projects in the evaluation portfolio varied depending on the specific pairs of GPs considered, with pockets of strong collaboration along with some that could potentially be strengthened. GPs could better leverage each other’s expertise to design interventions with higher impact. Where strong collaboration exists, there is evidence of improved project design and jobs focus—for example, on agriculture value chains between the Agriculture and Food and the Finance, Competitiveness, and Innovation GPs.

Recommendations

Based on the evidence and findings presented in the report, the evaluation makes the following two recommendations:

Recommendation 1. IDA could strengthen the measurement of its contribution to the achievement of jobs objectives. This can be achieved through better and more relevant corporate-level indicators, better project monitoring and evaluation, and enhanced support for country statistical systems for measuring labor market outcomes. Implementation of this recommendation has the potential to significantly improve learning, adaptation, and accountability.

Currently, IDA’s Tier 2 indicators capture outputs, whereas Tier 3 indicators have yet to be used to incentivize better results frameworks in jobs projects, as was successfully done to encourage gender-disaggregated measurement.3 It would be necessary to amend guidance and procedures that discourage teams from including appropriate outcome-level indicators in results frameworks. IDA could also improve its mechanisms to support country statistical and monitoring and evaluation systems for measuring jobs outcomes.

Recommendation 2. IDA could draw more systematically on jobs diagnostics to inform country-level operational engagement. This can be achieved by strengthening the ownership and use of jobs diagnostics and the integrated approach contained therein to inform policy dialogue, CPF priorities, and operational design. For example, Country Management Units could better incentivize cross-GP collaboration by drawing on diagnostics to establish an integrated and contextualized vision of policy priorities to be the basis of policy dialogue and project design.