Lack of proper skills and knowledge is one of the challenges Bangladeshi youth face in the labour market; training on entrepreneurship skills and knowledge is likely to address this problem. In this context, BRAC introduced a pilot project called “Promoting Business Incubation for Small Entrepreneurs (PROMISE)” that offers an integrated training on entrepreneurship to the disadvantaged youth. While evaluating this training, we found that it shifts employment patterns from wage employment to self-employment, leading to a 17% increase in the income of the youth. It also increases youth’s involvement in an enterprise, their financial inclusion, cognitive attributes, social network, and household welfare in terms of consumption expenditure. However, there still remains a gap in terms of ensuring a decent work environment and empowering female youths.
Researchers: Tahsina Naz Khan; Atiya Rahman; Anindita Bhattacharjee
Partners: BRAC
Timeline: 2018-2019
Status: Completed
Contact: Dr Narayan C. Das; narayan.das@bracu.ac.bd
Context
The history of Asia’s largest economies recommends capitalising on human resources to achieve high economic growth. Investment in building entrepreneurship through education and training is one of the promising practices. A number of studies identified that entrepreneurship training ensures the sustainability of existing business and helps launch new ones. It also enhances business knowledge, growth, and entrepreneurs’ livelihoods. However, policy-makers and practitioners face an evidence gap in its economic and social impact while adopting or scaling up any business training program. In this study, we address this gap by evaluating a comprehensive program on entrepreneurship skill and knowledge development initiated by BRAC in Bangladesh.
Intervention
With an aim to promote youth entrepreneurship and ensure their sustainability in the market, BRAC initiated the Promoting Business Incubation for Small Entrepreneurs (PROMISE) program in 2017. The program generally targets youth aged 20-25; it also considers individuals aged more than 25 years if they meet the following criteria: a) skilled in a particular trade, b) literate, and c) for existing small entrepreneurs, the age of enterprise must be less than two years and the youth who are interested to start an enterprise must agree on starting their business within six months of program participation. The target group also include trainees from BRAC’s another skills training program titled “Skill Training for Advancing Resources (STAR).” The intervention consists of classroom training, mentorship, loan disbursement, and follow-up support.
Objectives
The objective of this evaluation is to examine whether the entrepreneurship skill and knowledge development training changes employment—particularly self-employment, income, financial market participation, business management knowledge and behaviour, decent work environment practice and cognitive and social attributes.
This study is relevant to SDG 8 (Decent Work and Economic Growth), particularly to promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all.
Methodology
Our sample consists of youth from two batches, referred to as the 2017 and 2018 cohorts. From each batch, we selected two groups: 1) those who received the entrepreneurship training, referred to as participants and 2) those who did not, referred to as non-participants. For implementing the 2017 cohort, BRAC listed 453 primarily eligible individuals. Among them, 200 individuals were finally selected and surveyed. In addition, we surveyed 200 more individuals who were in the primary list of selection but not make it to the final selection. Following a similar sampling technique, we surveyed 307 selected youths and 389 near eligible youths from 2018 cohort.
We did not collect any baseline data; instead, the administrative data collected by the program during the selection process served as the baseline data. We conducted a follow-up survey in November 2018 and collected information on demographic characteristics, labour market participation, business involvement, loan dynamics, savings, business behaviour and management; decent work environment, use of social media, perception of the PROMISE program, etc. We successfully surveyed 486 participants (179 and 307 from 2017 and 2018 cohorts, respectively) and 488 non-participants (99 and 389 from 2017 and 2018 cohorts, respectively). We used the Propensity Score Matching (PSM) method to estimate the intervention’s impact.
Findings and Recommendations
As per our findings, the monthly income of the PROMISE participants shows an increment over the non-participants by 17 per cent due to the PROMISE intervention. This increment in participant youths’ monthly income seems to be translated into increment in their savings by 36 per cent and into per-capita monthly non-food expenditure at the household level by 30%. In terms of employment, we find that entrepreneurship training generates two types of positive shifting—from unemployment to self-employment and from wage employment to self-employment. Specifically, it increases self-employment by 36 per cent and decreases wage employment and unemployment by 42 per cent and 75 per cent, respectively. Subsequently, the participants are 42 per cent more likely to be involved in entrepreneurship, especially in their own enterprise rather than in a family or joint enterprise.
The PROMISE program significantly improves the participants’ access to the loan as well; they are 320 per cent more likely to use the loan for business activities. We also found improvement in participants’ enterprise behaviour compared to that of non-participants. They are more likely to develop good communication with local entrepreneurs that have helped them to develop their enterprise. It was evident from our findings that the participants have incremental gain over the non-participants in terms of experiencing progress in life during the last one year. The PROMISE participants are 15 per cent more likely to envision themselves in big enterprise ownership after five years than against wishing to see themselves in self-employment, private service, or working abroad. In terms of the use of technology, we found an impact on desktop use by 63 per cent and on using both types of mobile phones (smartphones and feature phones) by 34 per cent. Moreover, the participants are 16 per cent more likely to have an internet connection and are 26 per cent more likely to use social media to obtain information.
However, in regard to a decent workplace environment, only 21 per cent of the participants had access to first aid facilities and 20 per cent had safety equipment needed to prevent professional hazards. Furthermore, there is an opportunity to work empowering female youth more.