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Skills and Jobs in Brazil in Jobs and Skills Almeida and Packard and Almeida Skills and Jobs in Brazil Skills and Jobs in Brazil An Agenda for Youth Almeida and Packard Rita K. Almeida and Truman G. Packard INTERNATIONAL DEVELOPMENT IN FOCUS INTERNATIONAL INTERNATIONAL DEVELOPMENT IN FOCUS Skills and Jobs in Brazil An Agenda for Youth Rita K. Almeida and Truman G. Packard © 2018 International Bank for Reconstruction and Development / The World Bank 1818 H Street NW, Washington, DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org Some rights reserved 1 2 3 4 21 20 19 18 Books in this series are published to communicate the results of Bank research, analysis, and operational experience with the least possible delay. The extent of language editing varies from book to book. This work is a product of the staff of The World Bank with external contributions. The findings, inter- pretations, and conclusions expressed in this work do not necessarily reflect the views of The World Bank, its Board of Executive Directors, or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other informa- tion shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. Nothing herein shall constitute or be considered to be a limitation upon or waiver of the privileges and immunities of The World Bank, all of which are specifically reserved. Rights and Permissions This work is available under the Creative Commons Attribution 3.0 IGO license (CC BY 3.0 IGO) http:// creativecommons.org/licenses/by/3.0/igo. Under the Creative Commons Attribution license, you are free to copy, distribute, transmit, and adapt this work, including for commercial purposes, under the following conditions: Attribution—Please cite the work as follows: Almeida, Rita K., and Truman G. Packard. 2018. Skills and Jobs in Brazil: An Agenda for Youth. International Development in Focus. Washington, DC: World Bank. doi:10.1596/978-1-4648-1293-4 License: Creative Commons Attribution CC BY 3.0 IGO Translations—If you create a translation of this work, please add the following disclaimer along with the attribution: This translation was not created by The World Bank and should not be considered an official World Bank translation. The World Bank shall not be liable for any content or error in this translation. Adaptations—If you create an adaptation of this work, please add the following disclaimer along with the attribution: This is an adaptation of an original work by The World Bank. Views and opinions expressed in the adaptation are the sole responsibility of the author or authors of the adaptation and are not endorsed by The World Bank. Third-party content—The World Bank does not necessarily own each component of the content con- tained within the work. The World Bank therefore does not warrant that the use of any third-party- owned individual component or part contained in the work will not infringe on the rights of those third parties. The risk of claims resulting from such infringement rests solely with you. If you wish to re-use a component of the work, it is your responsibility to determine whether permission is needed for that re-use and to obtain permission from the copyright owner. Examples of components can include, but are not limited to, tables, figures, or images. All queries on rights and licenses should be addressed to World Bank Publications, The World Bank Group, 1818 H Street NW, Washington, DC 20433, USA; e-mail: [email protected]. ISBN: 978-1-4648-1293-4 DOI: 10.1596/978-1-4648-1293-4 Cover photo: © Shutterstock.com/bizvector/Andorra. Used with permission; further permission required for reuse. Contents Preface vii Acknowledgments ix About the Authors xi Abbreviations xiii CHAPTER 1: Overview 1 Population aging, technological change, and the productivity imperative 1 Youth economic engagement: New conceptual insights and the extent of youth disengagement in Brazil 8 Education outcomes and the motivations to invest in human capital 10 Youth labor market outcomes 16 Labor policies and job prospects for youth 18 Messages for policymakers: Shaping a skills and jobs agenda to engage youth 24 Notes 28 References 29 CHAPTER 2: A Skills-Based Framework for Youth Economic Disengagement 33 More than mincer and not just nem-nems 33 A skills-based human capital framework 35 How the analytical framework informs policymaking 42 Notes 43 References 43 CHAPTER 3: The Youth School-to-Work Transitions, and Challenges Ahead 47 The risk of youth disengagement: Beyond the status of out of school and out of work 47 Overall, levels of youth disengagement are high and unequal within the country 51 Youth disengagement patterns in the future 61 Notes 67 References 68 iii iv | SKILLS AND JOBS IN BRAZIL CHAPTER 4: Developing School-Based Skills for Higher Productivity 71 The 2017 ensino médio reform: Several opportunities during implementation 73 Beyond the ensino médio reform: Supporting effective teachers and school management for higher learning 79 Supporting retention and reducing dropouts in ensino médio: Motivating and informing students of the returns to education 86 Supporting transitions into higher education 90 Notes 94 References 96 CHAPTER 5: Labor Market Policies and Youth Employment Prospects 101 The statutory minimum wage 104 Employment protection 110 Income support and job search assistance for the unemployed 112 The 2017 reforms: Strengths and weaknesses 118 The pending labor reform agenda 125 Notes 131 References 131 CHAPTER 6: Supporting Employability and Labor Mobility for Out-of-School Youth 137 Second-chance programs 137 Training and other active labor market measures: A look into the youth policy portfolio 139 Revisiting reform priorities from the youth perspective 143 Notes 150 References 150 Appendix A: How Do Labor Market Institutions, Regulations, and Interventions Affect Youth? A Review of the Evidence in Brazil and Globally 153 Motivation and scope of this review 153 Methodology 155 Regulations 157 Institutions 166 Interventions 169 Notes 179 Bibliography 180 Appendix B: Background Papers Developed for This Report 193 Published World Bank working papers 193 Unpublished papers 193 Boxes 1.1 Placing the focus on cognitive, socioemotional, and technical skills 4 3.1 A qualitative perspective on out-of-school and out-of-work youth 59 4.1 How to build 21st-century skills into secondary curriculum: Lessons from Mexico and Peru 77 4.2 Promising lessons from the Pernambuco and Rio de Janeiro single-shift program for implementation of the ensino médio reform 78 4.3 How to reduce teen pregnancy with school-based interventions? The “Text Me Maybe” program in Ecuador and TOP in the United States 88 4.4 AlmaLaurea in Italy: Emphasizing labor market intermediation 92 5.1 Statutory wage floors: Impact on the skills and jobs of young people 106 5.2 Wage floor adjustment formulas: Respectability, with a productivity argument 125 6.1 National apprenticeship policies: Lessons from leading practice countries 146 6.2 Labor intermediation services: Best practices for youth 149 Contents | v Figures 1.1 Brazil’s population is aging rapidly 3 B1.1.1 The multidimensionality of skills 5 1.2 “Disengagement” happens when youth are no longer accumulating human capital 8 1.3 Portraits of youth disengagement from a skills and jobs perspective 9 1.4 Youth disengagement fell during the period of rapid economic growth, but is now rising: Trends by region and nationally, 2004–15 11 1.5 Learning still lags 12 1.6 Youth ages 15–16 enrolled in school and youth who are out of school, 2015 13 1.7 Education earnings premiums have been falling across levels of completed education 14 1.8 Most Brazilians substantially underestimate the value of education in the labor market 15 1.9 The rise in unemployment in Brazil has been steepest among youth 17 1.10 Informal employment is highest among the youngest cohorts of the workforce 17 1.11 Brazil’s federal statutory minimum wage has been rising steadily since 2003 19 1.12 Relative to median earnings, Brazil’s federal statutory minimum wage is higher than the average of OECD member countries and BRICs 20 1.13 After a long period of decline, the share of workers earning less than the minimum wage is rising with unemployment, particularly for youth 20 1.14 Public spending on labor market programs is weighted heavily to “passive” income support, over the “active” services that help people find jobs 23 1.15 Spending on “active” labor programs in Brazil is allocated mainly to wage top-up subsidies, leaving little for intermediation services and training 24 2.1 Heuristic illustration of youth economic engagement and disengagement paths 36 2.2 Portraits of youth disengagement from a skills and jobs perspective 36 3.1 Time allocation of Brazilian youth, 1995 and 2015 49 3.2 Change in time allocation for youth ages 15–17, by vulnerability group 50 3.3 Brazilian youth out of school and out of work by age and gender, 1995–2015 51 3.4 Youth ages 15–16 enrolled in school and youth who are out of school, 2015 52 3.5 GDP per capita and PISA 2015 performance, international comparison 53 3.6 Enrollment by age in selected Latin American countries, urban, 2015 53 3.7 Brazilians ages 25 and older, with completed secondary education or more 54 3.8 Time allocation for urban youth in selected Latin American countries 55 3.9 Unemployment rates for urban youth in selected Latin American countries, by age 55 3.10 Youth disengagement
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