Program for $25 million will include grants from the Government of Switzerland the IDB and the Government of Spain
Employability in Colombia will improve with a new program that seeks to bolster employment services, provide better job training and broaden the scope of competency-based certification, among other measures.
The program for $25 million seeks to increase access and quality of jobs. It will be financed by a $20 million loan from the Inter-American Development Bank, and $5 million in grant financing provided in equal parts by The government of Switzerland’s State Secretariat for Economic Affairs and the IDB. The Spanish Cooperation General Fund provided a grant of US$250,000 for technical support for the program preparation. The operation will be executed by the Ministry of Labor.
The Program is part of the IDB’s new US$1 billion Migrant Initiative, which was approved in May and includes grant money to help countries facing large and sudden migration inflows improve the wellbeing of migrants and their host communities, while bolstering their contribution to local economies and societies.
While Colombia has made progress in reducing poverty and inequality in the last few decades, many workers struggle to find employment in the formal job market. Structural unemployment rates are among the highest in Latin America and informality is prevalent: approximately two-thirds of workers do not contribute to social security and almost half earn less than the minimum wage. In addition, the large and sudden surge in migration from Venezuela poses additional challenges, with 1.4 million Venezuelans and 400,000 Colombian returnees entering the country from Venezuela in recent years.
Vulnerable populations such as women and migrants are less likely to access quality jobs due to different types of barriers. Policy makers need to identify the barriers different job seekers have and address them with tailored employment services or quality training and certification. This requires a deep understanding of the demands from employers in the productive sector. In this regard, the project seeks to address three leading constraints to employability: a lack of information among job seekers and recruiters, a skills deficit among job seekers, and a lack of recognition and certification of skills.
To improve the coverage and effectiveness of labor policies, the project will finance technological investments, training and certification services, and institutional capacity building. Information systems at the Public Employment Services will be updated, so job offerings and job seekers are matched using the latest artificial intelligence technologies. Data governance will also be improved to abide to principles of equity and universal access, eliminating the risk of discrimination based on gender, race or nationality, and ensuring accessibility to people with disabilities. Investments at the Ministry of Labor will strengthen its capacity to monitor and track the result of employment policies. A new information platform at the Ministry of Labor will provide information to the public on human capital gaps and education and training opportunities. The project will also finance activities to improve the quality and relevance of training services and skills certification.
The $20 million loan is pegged to the LIBOR with a 13-year amortization period.
The Inter-American Development Bank is devoted to improving lives. Established in 1959, the IDB is a leading source of long-term financing for economic, social and institutional development in Latin America and the Caribbean. The IDB also conducts cutting-edge research and provides policy advice, technical assistance and training to public and private sector clients throughout the region.