Most developing countries have disproportionately large young populations. According to the United Nations (UN), 90% of the world’s 10- to 24-year-olds reside in these countries. However, most of these youth face dismal career prospects. In South Asia, over a quarter (26.4%) of youth (aged 15 to 24) are not in education, employment, or training (NEET), their unemployment rate is also higher than that of the older labour force, and most fail to find decent, secure employment, according to a 2024 report by the International Labour Organization (ILO). Bangladesh is no exception; 22% of its youth are NEET, and their unemployment rate is more than twice the national average, according to the Bangladesh Labour Force Survey 2022.
The fast-growing formal retail sector in many developing countries, including Bangladesh, presents a promising avenue for decent youth employment. Young people are finding work in formal grocery outlets and large retail stores that offer a variety of products, such as apparel, shoes, and electronics, primarily as sales representatives and store managers. Confidence and good communication skills are essential in these roles. Naturally, relatively better-off youth with better education are more likely to avail themselves of these opportunities compared to their poorer counterparts.
Worldwide, trade-specific vocational and entrepreneurship skills training are the two dominant strategies to help underprivileged youth find decent employment. Training youth for the retail sector, however, is a largely uncharted territory, primarily involving soft skills. BRAC has a well-established, specialized skills training program, with an equal emphasis on classroom training and apprenticeships under local master craftspersons (MCPs).
Realizing the potential of Bangladesh’s growing retail sector, BRAC launched an initiative in December 2019, titled Progressing the Retail Sector by Improving Decent Employment (PRIDE). The pilot phase of the initiative supported underprivileged youth (aged 18 to 35) to find employment in the retail sector in four major metropolitan cities—Dhaka, Chattogram, Khulna, and Sylhet. The program combined classroom training on physical store management, health and safety, and customer relationships with an apprenticeship in a retail store to allow participants to gain practical experience. Participants also received allowances upon program completion, amounting to BDT 6,000 for men and BDT 9,000 for women. The pilot training was delivered in four batches. The training was classroom-intensive for the first and third batches, with 40 days of classes and 15 days of apprenticeship. For the second and fourth batches, the apprenticeship training was eight and 40 days, respectively. The idea was to identify which model was more effective.
To evaluate the pilot initiative, the BRAC Institute of Governance and Development (BIGD) conducted a randomized controlled trial (RCT), randomly assigning eligible candidates to treatment and control groups in each batch. A total of 1,220 eligible youth were assigned to either the treatment group (960) or the control group (260). The baseline survey successfully interviewed 675 individuals in the treatment group and 213 in the control group. The endline survey was conducted in June 2023, successfully surveying 71% of the baseline sample.
Researchers analyzed three major indicators of career outcomes: employment, hours worked (labour supply), and income. They found no statistically significant impact of PRIDE on employment, neither among those who were offered the program (intention-to-treat [ITT]) nor among those who completed it (local average treatment effect [LATE]). However, employment increased by 9% of the control group estimate—an economically meaningful but statistically insignificant result. The impact on hours of work was weak; only the LATE estimate was significant, amounting to 30% of the control mean. The largest and most statistically significant impact was on income—the LATE estimate was 48% of the control mean income. The higher increase in income compared to hours of work indicates an increase in productivity. When the researchers investigated the possible mechanism of the impact on earnings, they identified improved analytical and communication skills of the participants due to the program as key drivers.
The classroom-intensive training performed significantly better than the apprenticeship-intensive training, which had no statistically significant impact on any of the career outcomes.
Gender-disaggregated analysis revealed no statistically significant impact for men overall, though the ITT estimate showed a meaningful 17% increase in income relative to the control mean. For women participating in the program (LATE), the increase in earnings was very large, at 84% of the control mean.
Almost two-thirds (73%) of the study participants were enrolled in school at baseline. The impact was large and statistically significant for this group, while no impact was found on participants who were out of school. Importantly, the researchers did not find any negative impact on school enrollment among the in-school participants.
Overall, the classroom-intensive training was found to have a meaningful positive impact on the income and productivity of underprivileged youth—particularly underprivileged women, one of the most disadvantaged groups in society. PRIDE also gave these youth a chance for upward mobility, signalled by the significant number of job changes among program participants. Finally, a benefit-cost ratio of 1.93 provides a strong argument for scaling up the program.
Access the journal article here.
