Challenges of working with value chains: Experience from projects on ground Discussion material September 16, 2015 Business Solutions to PovertyTechnoServe | 2 TechnoServe at a glance Challenges in measuring impact on jobs Reflections on the tools Topics for conversation TechnoServe supports smallholder farmers, small businesses and workers to increase their income Thousand, 2014 TechnoServe | 3 FARMERSBUSINESSESJOBS Male Female Undefined TechnoServe works in dozens of value chains in more than 30 countries in Africa, Latin America and India Malawi Mexico Mozambique Nicaragua Nigeria Peru Rwanda South Africa South Sudan Swaziland Tanzania Uganda Zambia Zimbabwe Active Benin Brazil Botswana Burkina Faso Chile Colombia Cte dIvoire Ethiopia Ghana Guatemala Haiti Honduras India Kenya Emerging Democratic Republic of the Congo El Salvador Morocco Past Belize China Costa Rica Dominica Madagascar As of 07/2013 Offices London, UK Norwalk, CT Washington, DC (Headquarters) Mali Panama Poland Sudan STRYDE Help rural young people in East Africa transition to economic independence 78 percent of 14,000 trained participants work in MSE, farming or wage employment Income increase by 233 percent A couple of examples of how our work creates jobs Business Solutions to PovertyTechnoServe | 5 Ganadera Empresarial Improve livelihoods of smallholder livestock producers in Nicaragua 4,000 farmers increase productivity, strengthen producer organizations and connect to higher-value markets Business Solutions to PovertyTechnoServe | 6 TechnoServe at a glance Challenges in measuring impact on jobs Reflections on the tools Topics for conversation Key challenges in measuring impact on jobs Business Solutions to PovertyTechnoServe | 7 Indirect impact excluded from narrow scope Unclear job definition Operational difficulties to measure direct impact 1 2 3 Indirect impact excluded from narrow scope Business Solutions to PovertyTechnoServe | 8 1 ChallengeDescriptionExample Multiplier effects not measured TechnoServe measures impact on project participants and household members Projects increases economic activity throughout the value chain Most projects do not have mandate/incentives to measure jobs up- and downstream Doing so would increase cost and lead to low response rate Milk farmers in Nicaragua Job creation in connected value chains out of scope Value chains are interconnected in complex webs Growth in one value chain creates jobs in inputs and consumer goods, which is not included in our measurement Lets work study in Mozambique (research) Adverse effects on other value chains Workers move from sector A to sector B Sector A suffers from losing trained workers and potentially increased cost of labor We currently do not assess impact on sector A Cotton in Tanzania a b c EXAMPLES Unclear job definition Business Solutions to PovertyTechnoServe | 9 2 ChallengeDescriptionExample People do not acknowledge family labor People do not acknowledge new job if it has been taken on by family labor, especially for gender-specific jobs Coffee in East Africa Lack of transparency into informal businesses Hard to collect data for informal businesses: who they employ, for how long and what they pay As above Increased sustainability of certain jobs not captured Improved sustainability for certain low-radar jobs not recognized despite increase in demand, time worked, earnings etc. Mango fournisseurs in Haiti People have multiple jobs Processing plant worker cultivates multiple crops and drives taxi Fruit plant in Mozambique Agricultural jobs often seasonal Many crops are highly seasonal and only provide income part of the year Horticultural harvesters in Kenya Importance of flexibility and choice in jobs People in rural areas may not want full time employment and prefer to continue farming their own land and doing other wage labor Cashew factory in Mozambique struggle to find full time labor because workers want part time a b f c d e EXAMPLES Operational difficulties to measure direct impact Business Solutions to PovertyTechnoServe | 10 3 ChallengeDescriptionExample Long-term impact not measured Impact often happens further out due to risk aversion jobs are added further out No budget to measure impact beyond 3 years after impact Small-scale entrepreneurs in Haiti Hard to keep track of workers and entrepreneurs Self-employed and entrepreneurs are often mobile, especially if they are young Hard and costly to track long term impact in scattered treatment group Youth training program in East Africa Isolating impact of skills from training Difficulties in measuring if entrepreneurs and workers increased their income because of training received or simply due to selection bias (we choose to work with high-potential individuals) As above a b c EXAMPLES Business Solutions to PovertyTechnoServe | 11 TechnoServe at a glance Challenges in measuring impact on jobs Reflections on the tools Topics for conversation A few reflections on the tool Business Solutions to PovertyTechnoServe | 12 How will the tool address multiplier effects? Can the tool be adapted to include interconnected value chains? How are jobs defined workers hired by firms or also self-employed? How are better jobs defined (everybody does not want full-time job)? How will the tool handle the fluid nature of employment and multiple parallel occupations?