Automn e 08 Undertaking the Faizabad Labour Market Survey Commissioned by UCA (University of Central Asia) Samuel Hall Consulting Research & Strategy in Afghanistan www.samuelhall.org April 2010 This survey was commissioned by the University of Central Asia (SPCE) to provide an assessment of the Faizabad labor market. Our research shows that there is a significant skills deficit in the local labor market. In spite of a relatively well performing primary and secondary educational system, Faizabad and its surrounding districts suffer from geographic, climatic, and topographic constraints, which prevent companies from doing business and interacting easily with other districts, provinces and countries. However, there are positive signs of economic potential and on the longer run, the economic and social development of Faizabad will mostly depend on its ability to open up its market to other districts (Kishm), provinces (Panjshir, Kunduz, Kabul), and countries (Pakistan, Tajikistan, and China). Given this context, UCA has a role to play as a facilitator and provider of training services to bridge the skills and training supply gap in Badakhshan. This research provides insights into the profiles of employers and employees in the main sectors of economic activity, assessing their levels of capacity and needs, and providing UCA with actionable recommendations in view of the establishment of a training center that will aim to support the overall economic development of the province. This report is a product of the staff of Samuel Hall Consulting. The University of Central Asia (UCA) does not guarantee the accuracy of the data included in this work. Samuel Hall Consulting encourages dissemination of its work and will normally grant permission to reproduce portions of the work promptly. For permission to photocopy or reprint any part of this work, please send a request with complete information to [email protected]. 2 Table of Contents 1. Introduction................................................................................................................... 6 1.1. Background.................................................................................................................................... 6 1.2. Project Description.......................................................................................................................7 1.3. Research Tools & Field Work ...................................................................................................... 8 1.3.1. Geographical Scope ..................................................................................................................8 1.3.2. Tools Used...............................................................................................................................12 1.3.3. Fieldwork Team.......................................................................................................................12 1.3.4. Sample Description .................................................................................................................13 1.4. Structure of the Report..............................................................................................................14 2. Respondents' Social and Economic Profile ....................................................................15 2.1. Age Structure ..............................................................................................................................15 2.2. Place of Origin.............................................................................................................................17 2.3. Household Composition and Income.......................................................................................18 2.4. Education.....................................................................................................................................20 3. Labor Market Analysis ..................................................................................................23 3.1. Companies' Profile .....................................................................................................................23 3.1.1. Ownership, Legal Structure, and Licensing .............................................................................24 3.1.2. Recruitment Channels and Human Resources ........................................................................26 3.1.3. Salaries, Income, and Expenses ..............................................................................................28 3.2. Business Challenges and Development Opportunities..........................................................31 4. Training and Capacity Building ......................................................................................34 4.1. Training Needs Self‐Assessment...............................................................................................34 4.2. Employee Skills Assessment......................................................................................................35 4.3. Training Market: content, perception, and willingness to pay ............................................36 4.4. Training Design: form, length, and certification.....................................................................39 5. Main Findings and Recommendations...........................................................................41 5.1. Economic and Labor Market Overview ............................................................................41 5.2. Market Opportunities.......................................................................................................43 5.3. Recommendations............................................................................................................47 5.1.3. General Approach ...................................................................................................................47 5.1.4. Specific Approach....................................................................................................................48 Annexes............................................................................................................................54 List of Key Informants .......................................................................................................................54 Acronyms ..........................................................................................................................................55 Units..................................................................................................................................................55 Bibliography......................................................................................................................................56 3 List of Tables Table 1: Quantitative Sample Description (breakdown by location)....................................................10 Table 2: Quantitative Sample Description (breakdown by district)......................................................13 Table 3: Quantitative Sample Description (breakdown by gender) .....................................................13 Table 4: Respondents’ Age Structure (basis of 100 for the 16 to 20 year old category) ......................15 Table 5: Respondents’ place of Origin ..................................................................................................17 Table 6: Relationship with the Head of Household ..............................................................................18 Table 7: Respondents Average Income (breakdown by district) ..........................................................18 Table 8: Personal loans (Breakdown by districts).................................................................................19 Table 9: Loaners (Breakdown by position) ...........................................................................................20 Table 10: Education Level (breakdown by district)...............................................................................20 Table 11: Education Level (breakdown by gender) ..............................................................................21 Table 12: Education Level (breakdown by Age)....................................................................................21 Table 13: Investing in Education (breakdown by province)..................................................................22 Table 14: Professional Development for children (breakdown by province and gender) ....................22 Table 15: Quantitative Sample Description (breakdown by sector, activity, and district) ...................23 Table 16: Business Ownership..............................................................................................................24 Table 17: Legal Status of the Company ................................................................................................24 Table 18: Registrations and Licenses (breakdown by district)..............................................................25 Table 19: Recruitment Channels (breakdown by position) ..................................................................26 Table 20: Family Network (employees only) ........................................................................................26 Table 21: Professional and Contractual Status (breakdown by district and gender) ...........................28 Table 22: Monthly Salaries (!388 and 1389).........................................................................................29