This is the companion volume to a research report on 'Education and Training for the Informal Sector' by S. McGrath and K. King with F. Leach and R. Carr-Hill, which was commissioned by ODA (Education Division) and completed in January 1994. The main report examined local, national and international interventions and initiatives aimed at promoting education and training for the informal sector. These were situated both within and outside the formal educational system. The information on which the report is based was drawn from the extensive and constantly expanding literature on the subject of Technical and Vocational Education and Training (TVET) and training for self-employment, as well as on the country studies commissioned as part of this research project.
With regard to formal education, the report considers recent reforms around the world which are attempting to provide a school curriculum which meets the future employment needs of young people, in particular in self-employment, to a greater extent than has been the case in the past. In non-formal education it examines an extraordinary wealth of projects and programmes in a large number of settings. While highlighting the general lack of success of many of the individual initiatives and reforms, it also attempts to pinpoint the strengths in what is on offer and to identify innovative practices which might serve as examples of what can be achieved with limited resources. At the same time it seeks to pass on a very strong message regarding the importance of considering the specific context, culture and environment in which these interventions and initiatives are operating, which precludes any generalisations.
BACKGROUND TO THE RESEARCH
Policy-makers in both industrial and developing countries as well as international donors have been showing increased interest in the informal sector. There is now the realization that growth in the formal 'modern' sector of the economy has slowed down in many countries (parts of Latin America and South-East and East Asia providing the main exceptions), and in some cases is experiencing shrinkage (especially where structural adjustment programmes most notably in Africa, and the sudden shift to a market economy, as in the Eastern European countries, have demanded massive cuts in public sector employment). In particular in the low-income agricultural economies of Africa, and parts of Asia and Latin America, the restrictions on growth imposed by debt burdens, structural adjustment and a continuing reliance on export commodities have been compounded by a low knowledge base in science and technology. Governments have somewhat belatedly realized that for the foreseeable future they will be unable to compete with the major industrial powers or even with some of their regional neighbours in modern forms of mass production, and that the modern sector will not prove to be the engine of growth for their expanding and increasingly youthful populations, to the extent that was originally hoped.
This realization that significant expansion in manpower demands for the formal sector is unlikely, combined with growing concern over rising youth unemployment with its accompanying risk of social unrest, has focused policymakers' attention on the informal sector, which in most cases is growing at a consistently faster rate than the modern sector ever did. It is here that the greatest employment opportunities for young people are likely to be found, at least in the foreseeable future. As the formal sector shrinks and the informal sector expands, the latter ceases to be regarded as a residual and unimportant category of the economy and becomes a serious subject of policy.
At the same time, there is continuing dissatisfaction with the way that formal education has failed to prepare young people for the world of work. At the World Conference on Education for All (WCEFA), which was held in Jomtien, Thailand in March 1990, considerable commitment was made by participating nations and by international donors to work towards Education for All (EFA), with the result that much attention has been focused since that event on improving both access and quality with regard to basic education. However little was said at the time of the conference about the work and employment consequences of moving towards EFA. The question asked on page 1 of our report for ODA was:
If a nation did strive to provide 'universal access to, and completion of primary education' and if it sought to secure a 'real improvement in learning achievement' (WCEFA 1990), would that translate into more productive work? Would expenditure on basic schooling and literacy somehow translate into a better, more productive workforce?
There is no certain answer to this question. For some there is the deep-rooted suspicion that formal education actually discourages productive work and in particular self-employment, by offering young people the opportunity to aspire to white collar jobs either in the public or private formal sectors, while for others it is a question of making formal education more relevant, especially through teaching practical and entrepreneurial skills (and many governments have recently renewed their efforts in this field). The debate continues around the issue of whether a good level of general literacy and numeracy, or explicitly vocational skills offer the better preparation for work.
At the post-primary/post-basic level, increasing attention has been paid to TVET, which so far appears not to have provided much satisfactory preparation for work. Much of the discussion at the secondary level has revolved around such questions as: What forms of TVET are most appropriate in different settings? Should it be provided in schools, in non-formal training centres or in the enterprises themselves? Should the traditional vocational emphasis on industrial and artisanal skills be replaced by a new focus on business and entrepreneurial skills, as being those that are crucial for gainful self-employment? The case studies reveal an enormous diversity in the kind of education and training opportunities available in each country beyond the post-basic education cycle, ranging from Kenya and Ghana's efforts to provide a more balanced and focused curriculum at the secondary level including skills provision for both employment and self-employment, to the Chilean strategy of promoting private training agencies and enterprise-based training, to India's long-standing emphasis on voluntary work by non-governmental organisations (NGOs) aimed at providing disadvantaged groups with the means to lift themselves out of extreme poverty.
At the same time, pragmatists realize that education and training alone will not stimulate self-employment opportunities, either among those who have gone through the full formal education cycle or among those who have never attended, or who have dropped out of, formal schooling. They realize that the self-employed require an enabling environment if they are to prosper and expand their activities. Low-cost credit, new and improved technologies and supportive government policies, which must include the cessation of harrassment of small operators by local police and officials, are required. The case studies give a clear picture of how difficult it is for the small entrepreneur to survive in a policy environment which is largely hostile to informal sector activity.
THE CASE STUDIES
Much of the country-specific data and many of the examples of current practices and innovative programmes in education and training for the informal sector which were used in the main report have been drawn from four country studies commissioned as part of this research project. The four studies are from West Africa (Ghana), East Africa (Kenya), Asia (India) and Latin America (Chile). They provide a great wealth of information on the many types of initiatives being taken by a wide range of actors in the area of education and training, providing data and analyses which have probably never been gathered together in such a comprehensive manner before. Because of their potential value to policy-makers, donors, researchers and practitioners with an interest in education and training for the informal sector, the Overseas Development Administration (ODA) has kindly agreed to publish these country studies as a separate companion volume to the main report.
The point was made early on in the main report that initiatives for self-employment and informal sector development do not emerge as elements that can be easily isolated from a particular social, cultural and economic context. Innovations cannot be lifted from one institutional setting and grafted on to another which is fundamentally different. Hence the decision was taken to invite colleagues from developing countries to contribute case study material to this research project, so as to provide a valuable insight into the ways in which the notion of the informal sector relates to different traditions of schooling, training and economic activity that themselves are undergoing continuous change.
For their country studies, our colleagues in each of the four selected countries were asked to explore and report on the range of recent local, national and international interventions and initiatives in their country which were relevant to the orientation and re-orientation of education and training towards self-employment and income generation. Four different settings for this type of education and training were identified: regular schooling, post-basic schooling (including specialised technical and vocational schools and training centres, and national industrial training institutions), enterprise-based training, and training within the informal sector itself (most notably systems of apprenticeship).
The researchers were also asked to carry out a search of the recent literature in their country on the subject under study. Their country studies contain a large amount of valuable information from policy documents and reports on innovatory projects or programmes, which would otherwise have been inaccessible to outsiders. This is supplemented by personal interviews with key officials and personal observations. The researchers were also asked to identify and examine a number of key initiatives of recent origin as in-depth case studies which would illustrate some dimension of 'good practice' as well as of failure. There are eight short case studies in the case of Ghana, five from Kenya, four from India and two detailed and contrasting case studies from Chile. They cover government, donor, NGO and private initiatives. The researchers were then asked to elaborate on the lessons learnt from these key projects and programmes, and to consider some of the policy implications.
Although it was not possible to follow a uniform approach to collecting, analysing and presenting data because of time and geographical constraints, nevertheless the researchers were able to use this common framework and common set of questions in approaching their material. They did also have the opportunity to meet and discuss their findings together when they came to Britain in November 1993 on an ODA-sponsored visit (and attended a workshop in Turin on 'Training for Self-Employment through Vocational Training Institutions' at the invitation of ILO).
Boeh-Ocansey's Ghanaian study is carried out against the backdrop of the Structural Adjustment Programme of the World Bank and IMF. The sectoral reforms initiated under this programme have encouraged private sector involvement in education and training and the redeployment of many government workers, some of whom have obtained places on training programmes for self-employment. Boeh-Ocansey reviews a wide range of initiatives. These include, in the formal education system, government attempts to reorganize the basic cycle of regular schooling towards the needs of self-employment in the informal sector, and recent changes at secondary and post-secondary levels. Outside the formal education system, initiatives include programmes aimed at training in income generating skills for youths who have missed all or part of the basic education cycle; programmes specifically oriented towards informal sector practitioners; and programmes which seek to identify and encourage those already in formal sector employment who show an interest in moving into the informal sector.
Boeh-Ocansey's study reveals that, with government realization that employment opportunities in the formal sector of the economy will continue to be limited, educational reforms in Ghana are now emphasizing the acquisition of skills which promote self-employment and entrepreneurship. TVET is being strengthened and non-formal education expanded and improved. However these initiatives will only be meaningful if they are adequately evaluated and judged cost-effective. He notes an alarming lack of evaluation of projects and programmes offering training for the informal sector, in particular in terms of what happens to trainees once they have completed their training, with the result that it is impossible to judge how successful such initiatives are in actually helping people find productive work.
At the same time, the author notes the continuing low level of morale among teachers and the outflow of experienced professionals from teaching to other occupations, the lack of experienced teachers in scientific, technical and vocational subjects, the continuing disparity in quality between urban and rural institutions, and inadequate facilities and resources brought about by acute financial constraints in the Ghanaian economy, all of which are potential impediments to the success of the initiatives detailed in the study. This is a situation which is replicated in many developing countries.
Finally, the author warns that the informal sector will never be a prosperous viable form of employment while it continues to concentrate on traditional indigenous productive activities. Training for the informal sector needs to produce modern aggressive entrepreneurs whose products and services are of a high standard and competitive in international markets.
Oketch's study of Kenya reviews strategies that individuals, the government and non profit-seeking organisations are using to improve skills in the informal sector. Statistics given by Oketch show that the greatest number of job opportunities (75.7%) in Kenya are to be found in the informal sector rather than in the modern wage sector or in agriculture. Since 1983 employment in the informal sector has been growing at the rate of 14% p.a., more than three times that of the formal sector. At the same time, however, the gap between manpower supply and job opportunities in both the formal and the informal sectors is increasing. In recognition of this, one strategy adopted by the Kenyan government to stimulate employment opportunities has been to formulate specific education and training policies for the informal sector. Of the four countries studied, Kenya has gone the furthest in attempting to radically transform formal education to meet the needs of the labour market and especially self-employment and income generation. For example, under the reformed educational system (84-4), the subject of entrepreneurial education has recently been introduced at the upper primary level alongside some practical subjects, with a range of technical and business studies also being offered at secondary level.
However Oketch suggests that the 8-4-4 reforms have not been successful, largely because they were introduced too rapidly, with inadequate resources, including a lack of specialist teachers, workshops and equipment. As a result, negative attitudes continue towards practical education, technical skills remain poor, and pupils are still preoccupied with passing examinations in academic subjects. Oketch suggests that the educational reforms have failed to assist young people into self-employment, and evidence for this is to be found in the fact that among the self-employed there is very little publicly funded training. Most people in the informal sector continue to receive training through the traditional apprenticeship route.
Nevertheless Kenya offers a wide range of training opportunities for self-employment both in the formal and non-formal education systems. Oketch identifies nine different types of agencies or processes providing skills for self-employment. Kenya has over 600 institutions involved in technical and vocational training for school leavers, of which the Youth Polytechnics are probably the best known. There are also 50 NGOs offering some kind of training to informal sector operators. However Oketch draws the depressing conclusion that the two most successful processes of skill enhancement in the informal sector are based not on government or NGO initiatives, but rather on the initiatives of informal sector operators themselves, namely apprenticeship, and the individual's own decision to move from wage employment to self-employment.
The Indian study by D'Souza and Thomas is set against a background of a high proportion of economic activity taking place in the informal sector, with an estimated 85-90% of the total workforce engaged in it (if one includes agricultural activity), as well as very high levels of unemployment (during 1992-97 an estimated 58 million people in India will be looking for employment, rising to 94 million during 1993 - 2002).
This review focuses on the activities of four NGOs working in the field of non-formal education in the state of Gujarat. It found that all four had targeted their efforts at the marginalized and deprived and had linked their education and training activities to socioeconomic development. Their emphasis was on capacity building rather than on employment generation or job skill development per se. Indeed the NGOs preferred to develop activities which would supplement rather than substitute existing employment or income generating activities. Their approach was long-term, emphasising community-based economic activity, often through cooperatives, and sustainable development through people's participation and the sharing of responsibility in the development process. Effective training for income generation was seen as requiring conscientization to be effective. Finally, they all emphasized education and training that was relevant to the specific socio-economic contexts of the client or beneficiary groups, and indeed their success was seen as dependent upon this.
In the authors' opinion, the projects were all more concerned with social mobilization, social justice and equity than with economic efficiency or productivity, which perhaps explains why they were successful in bringing about socio-psychological change in their target groups but little improvement in economic wealth and income generation. Although they were able to improve the subsistence employment of the communities they were seeking to assist, they were unable to promote employment of a kind that would bring substantial gains for individuals or communities. The authors conclude that one reason for this was that they had attempted to build on traditional economic activities (agriculture, forestry, cottage or home industries). None of them seemed inclined to develop competencies for non-traditional modern industrial occupations and indeed only one of the four NGOs would have had any capability for doing this. Moreover the low level of education among the beneficiaries would have made it difficult for them to acquire the necessary skills for industrial entrepreneurship.
The Chilean case study by Messina is based on two training programmes for unemployed youth which are presented and then compared in order to develop a series of reflections on the role that training for the informal sector ought to play, within the framework of adjustments and 'modernizing productive transformation' processes currently taking place in Latin America.
Messina concludes that the Chilean government is more concerned with employment policies, especially for the modern sector, than with training policies. Public training programmes are geared towards socially critical and short or medium term conflict-carrying populations (low income urban sectors, particularly the young and female heads of household) in an attempt to integrate them into the modern urban sector as a reserve army of labour. Places on these programmes are taken up predominantly by males, women being catered for by small scale state programmes offering wage-earning placements, self-employment or micro-enterprise. Training activities for the informal sector are limited to micro-experiences developed by NGOs which are also aimed at the more vulnerable groups: young people hardest hit by marginality, women of limited means who are heads of household. The state has assumed the social task of training within a neo-liberal context dominated by the business sector, but has yet to create a training system or flexible, participative, and medium term educational institutions. As elsewhere in Latin America, training programmes tend to be under the authority of the Ministry of Labour and Social Work or the Ministry of Economic Affairs, rather than the Ministry of Education.
AN OVERVIEW
As has already been emphasized, it is impossible to directly transfer understandings from one context to another. However, some general points can be made about education and training for work (not necessarily for the informal sector exclusively) based on the four country studies:
1. The studies have uncovered a large amount of activity in the area of education and training in all the countries concerned, but at the same time they have failed to produce much evidence of convincing success. In particular, evaluation of innovative projects and programmes as well as of system-wide reforms to formal education appears to be spasmodic and superficial.
2. There are many variations available, ranging from school-based initiatives to non-formal training schemes, to enterprise-based training and training within the informal sector itself. Within each of these settings, likewise, there is great variety: in the type of training offered, the agencies or individuals providing it, the groups targeted, and the duration, location and content of courses.
3. While the state appears to be more concerned with containment of the unemployment problem and mechanisms for getting young people into productive work, NGOs appear to be more interested in community regeneration and socio-economic development. This links up with the point made early on in the main report that there are two tiers of self-employment to be found in the informal sector: on the one hand the entrepreneurial tier (often using relatively up to date but small scale technology) and on the other, the much larger subsistence tier (using very low levels of technology and traditional skills). Nevertheless, despite a great deal of activity directed at disadvantaged groups, there is little evidence that programmes of skills training are able to reach the very poorest segments of the population.
4. In all but the Chilean case, there is strong recognition by the state of the importance and the potential for self-employment and income generation in the informal sector. In Chile great faith is still placed in policies and strategies that favour strengthening and expanding the modern sector of the economy, and in directing training efforts in that direction. Indeed it is the only country of the four where employment in the formal sector is still experiencing strong growth, and where the informal sector plays a relatively small role in economic activity (40%). On the basis of this evidence it may be possible to conclude (somewhat tentatively) that support for micro-entrepreneurial activity and the provision of training in this area is more prevalent where there is an over-staffed and inefficient public sector (mostly now under threat from structural adjustment agreements) and a small struggling modern sector.
5. There is consensus that education and training for self-employment will not on its own generate gainful economic activity. An enabling environment is also necessary, which should include access to credit, and supportive policies from a government committed to facilitating small-scale enterprise.
6. Many of the projects and programmes for disadvantaged groups described in the case studies sought to build on traditional skills (eg craft skills) rather than introduce the target groups to new areas of potential economic activity. The one exception in this respect was again Chile, which does not have a developed traditional artisanal sector (most subsistence self-employment seems to be in the area of petty trading) or a strong system of traditional apprenticeship. At the same time, there appeared to be some consensus in the country studies that there was little scope for sustainable income in traditional small-scale areas of self-employment (in the main report this was found to be particularly the case for women), and that one of the functions of education and training for the informal sector should be to create dynamic entrepreneurs who are able to cope with changing demands for products and services in a competitive modern free-market economy.
EPILOGUE
Whilst these case studies do provide some material for comparative speculation on the subject of education and training for the informal sector, we would emphasise that, in the current global crisis of employment, their real value lies in understanding the different ways in which the relation between education, training and work is conceived of in different socio-economic contexts. Although there appear to be global trends towards marginalization and modernization, these will be translated very differently according to the prevailing social and economic conditions; and it is impossible to plan without an appreciation of those differences. These four pictures, compiled within a roughly comparable framework, are an invaluable contribution to that understanding.
Roy Carr-Hill and Fiona Leach
Institute of Education, University of London
May 1994
