In President Obama’s final budget proposal to Congress, the administration has called for $750.6 million to fund ongoing U.S. assistance for Central America. Last year, the President requested $1 billion for the region, and Congress, conscious of the challenges driving migration, funded $750 million in aid. In line with last year’s request, the FY2017 budget seeks to fund a comprehensive strategy that places heightened emphasis on resolving governance challenges and reducing corruption, investing in inclusive economic growth, and addressing the unrelenting violence that has made Central America one of most dangerous regions in the world.
The central objective of the U.S. strategy is to address the factors that drive so many Central Americans to leave their communities and to give people—particularly young people—reason to hope that they can have a better future at home.
The research is clear. Young people are fleeing the Northern Triangle countries of Central America – El Salvador, Guatemala and Honduras – due to a combination of factors: high levels of criminality and violence, fear of gang recruitment, poverty, and the lack of any prospects to improve themselves through education or employment training. Government institutions have been unable to address these issues effectively.
WOLA has written extensively about the need to address violence and insecurity in the region through programs that focus on comprehensive community based violence prevention, about reforms to the police and justice sector, and about the need to focus on strengthening the competence, capacity, and honesty of state institutions.
The outline of the problem is well known. More than one million young people in the Northern Triangle countries are neither in school, nor employed. Commonly called ninis, there are 350,000 in Guatemala and 240,000 in El Salvador. Honduras has the highest rate of ninis in Latin America with 27.5 percent of young people out of school and without employment.
To address these problems, governments and donors will have to pursue more effective and equitable development strategies. They also have to develop other options that can allow youth to see their future at home. Public policies and new forms of interventions can create more opportunities by encouraging more children and young people to continue their education, and establish new programs that ease young people into labor markets and connect both training and education to productive sectors of the economy and decent jobs.
The strategy of the Obama administration sets its sites squarely on these challenges. It establishes the goal of reducing youth unemployment in Honduras, El Salvador, and Guatemala by 50 percent, while putting U.S. Agency for International Development to work to develop approaches that will keep children in school, reintegrate drop outs and provide workforce training to young people.
These are the right goals. But setting goals is the easy part. Meeting them is a whole different kettle of fish.
Off to good start, the administration and Congress, in a rare sign of bi-partisan collaboration, have completed the first step in accomplishing any goal; they have marshalled adequate resources. In December, Congress allocated $299.4 million in Development Assistance and another $183.5 million in Economic Support Funds to support the strategy.
The administration deserves a great deal of credit for its budget request of $342.9 million in Development Assistance and $100.3 million in Economic Support Fund for Fiscal Year 2017. With this request the Obama administration has completed the second step toward executing their Central American strategy: sustaining focus.
Having gotten funds and sustained its focus, the administration must now invest in programs that produce results. This will mean working with the governments of El Salvador, Honduras, and Guatemala as well as collaborating with non-governmental implementers that have solid track records of delivering effective programs in the region. Congress, concerned that the governments have not always shown the commitment to make programs work, has wisely tied the release of U.S. assistance to evidence that governments are making concrete progress.
Beyond political will, there are plenty of challenges to overcome.
As the report shows, more needs to be done to strengthen government workforce development programs, and to increase the number and the quality of job training programs for youth. (We hope to see increased funding, from the United States and form other donors, for these programs that can have an immediate impact on youth.)
The Ministries of Labor in El Salvador, Honduras, and Guatemala have historically focused on general workplace labor policy, not on policies that connect people to employment. And they have not directed sufficient attention to youth employment programs. Across the board, the inability of government ministries to coordinate among themselves is holding employment programs back. The national employment systems need institutional strengthening, and a culture of cooperation must be fostered within the government and between the public and private sectors.
In a modest sign of improvement, all three countries are experimenting with programs that offer incentives to employers to hire young people who have no prior work experience. And in El Salvador, the government has begun a number of innovative education, workforce development, labor market insertion, and entrepreneurial training programs targeting vulnerable youth.
However, as the U.S. invests in youth employment it should encourage recipient countries to improve a few basic practices. Formal education systems should do more to connect students to experience in the workplace. More can and should be done to incorporate labor market analysis into employment training programs to avoid a skills mismatch with jobs that are available. The quality and content of training should also receive attention to ensure that graduates are desirable hires. And employment programs should include both vocational skills as well as the soft skills of problem solving, critical analysis, life skills, and interpersonal communication.
Finally, the U.S. should invest in rigorous and ongoing analysis of employment training programs to determine what is working and what is not. Outcomes of workforce development and employment policies and practices (by national governments as well as NGOs) should be evaluated according to youth employment insertion, not the number of individuals registered or trainings conducted.
The transformation of the Northern Triangle countries of Central America will not occur overnight, but the new resources and the sustained attention to the key challenges these countries confront should provide some hope that we are at the cusp of a new era for the region. Getting investments in education and employment programs going in the right direction should be a top priority of the administration. We hope that our paper can help in some small way.