How to tackle social exclusion in the labour market

The general trend in poverty reduction over the last decade for many countries in South Asia has been a positive one. However, look a little closer and for particular groups of the poor there has been little opportunity to move out of poverty. In many contexts, there is a strong correlation between poverty and being excluded from the economy and society because of gender, caste, ethnicity or religion.

Socio-economic norms fuel gender discrimination, where women are less mobile and therefore unable to migrate to find work. They are also responsible for domestic chores limiting economic opportunities, they receive lower pay than men and are less likely to own assets and less likely to participate in community decision-making. Take for example, women in the Chars – a remote area in northern Bangladesh. Facing multiple dimensions of exclusion on the basis of their gender and geographical remoteness, these women live in an area which has been historically politically and economically marginalized, resulting in few economic opportunities and highly seasonal work.

In our recent ODI research we examined the extent to which social protection and labor market programs can tackle social exclusion in south Asia. Specifically, we examined the asset transfer program called the Chars Livelihoods Program (CLP). We can draw three important lessons from the program, which tell us how best to support poor, socially excluded households in the labor market.

The first lesson is perhaps the simplest. Interventions must be designed and implemented appropriately to respond to specific needs. A clear example of this can be seen in the CLP example in Bangladesh. In recognition of both the sociocultural and the economic barriers that women face in generating income and accessing and owning productive assets, CLP transfers a large-value asset – such as a cow. This is culturally appropriate for women to generate an income from as it can be done from their homestead.

The second lesson is that access to complementary services and programs is necessary. Ensuring labor market participation for the socially excluded requires more than just income opportunities. The CLP program in Bangladesh demonstrates that an integrated approach has been key to its success. This approach not only supports women through direct asset transfers, but it also provides training opportunities to strengthen their skills and knowledge, as well as providing opportunities for creating social networks both within the community and more broadly. Indeed, our research shows that CLP has had a positive impact on women’s livelihood diversification and ability to generate an income from agricultural-related activities. However, we also find that there are limitations to what one program can achieve. Tackling wider issues of exclusion and marginalization is necessary to enable greater (and more equal) labor market participation. Focusing on improving women’s skills alone is insufficient to enable them to take advantage of economic opportunities.

Another key lesson to emerge from our research is the importance of supporting the empowerment, agency and voice of the socially excluded. A strong body of literature exists which demonstrates the correlation between empowerment and economic productivity. While the programs across our case studies in south Asia sought to improve the income generating opportunities for marginalized women, none of them explicitly sought to challenge the imbalance of power structures which cause and perpetuate exclusion and discrimination in the labor market. No significant changes were evident in women’s decision-making power, or making demands to program or government officials. However, there were some positive indications that indirectly programs can build women’s confidence in interacting with community members or local government officials as a result of increased income or contact with program implementers or the government through program channels (see below).

Changes in respondent’s self-perceived confidence levels in interacting with community members and officials after receiving CLP benefits
(% of beneficiaries)

Source: ODI

This article was originally published on The World Bank’s Jobs & Development Blog. Publication does not imply endorsement of views by the World Economic Forum.

To keep up with the Agenda subscribe to our weekly newsletter.

Author: Rebecca Holmes is a research fellow at the Overseas Development Institute in the U.K.

Image: Women work in a cauliflower field in Kolkata. REUTERS/Rupak De Chowdhuri.