Creating Jobs for Youth through Internships in Yemen

By Farhad Peikar.

Finding a decent job can be an uphill struggle for many young people, especially recent college graduates around the world. Regardless of their chosen industry, they face a common dilemma: they need experience to get a decent job but they cannot gain that experience without working.

This was exactly the case for Jubran al-Shumairi, a resident of Sana’a, Yemen. Despite graduating from an engineering school, the tall and slender man had a difficult time finding a job in in his field of study.

While in many developed countries, the transition from university to employment is often filled by internships, in many poor and middle-income countries—including Yemen—internships are an unknown phenomenon. When they are offered, they may present too many challenges to be adopted. Companies may not be prepared to guide inexperienced workers, as it takes time and effort to train youth with little to no work experience. Likewise, young people may find internships to be daunting if they cannot afford to take-on unpaid employment due to their unfavorable economic situation. As a result, many youth in the MENA region must decide whether to leave their home countries in search of jobs or remain unemployed.

Fortunately, al-Shumairi did not have to take any drastic measures. He was one of a few recent graduates in Sana’a who received a six-moth paid-internship with MASS Arabia, an enterprise specializing in the development and production for industry machines and product lines.

The internship program was part of the Enterprise Revitalization and Employment Pilot (EREP), a World Bank Group project financed by the MENA Transition Fund. Launched in June 2013, the EREP has worked on dual tracks to improve the business development plans of firms and to help recent graduates find internships.

For businesses, the EREP provided a matching grant of up to $10,000, as a 50 percent subsidy towards the cost of procurement of business development services, training and goods to improve the business development plans of the firms.

The EREP also worked to place 400 young Yemenis – mainly from the two major cities of Sana’a and Aden – into paid internships. While the project covered a 50 percent stipend for the interns for up to six months, firms participating in the matching grant scheme provided the other half.

“In the past, we were not interested in hiring new graduates because they did not have experience and we did not trust them,” said Hisham Mohammed Alsnhanai, one of the managers at MASS Arabia and al-Shumairi’s employer.

“However, the (EREP) program encouraged us to hire them because paying half their salaries wasn’t a big deal if we could benefit from their knowledge,” he said.

That arrangement really paid off for MASS Arabia, which has offices in China, Saudi Arabia and Yemen. After six months in an internship as an electric technician, al-Shumairi offered the company a plan to restart the company’s furnace production line, which had been suspended. “I worked with a senior engineer and went through rigorous training,” al-Shumairi said. “Today, I am in charge of this section of the factory.”

It was not only al-Shumairi who had an upright career progress. Many others also succeeded in their fields of work. For instance, Aseel Alhatari, another resident of Sana’a, used the internship

opportunity at the Saba Medical Center to move from being a receptionist to working as a quality control specialist. She did all that in less than a year.

Progress Interrupted

The implementation of the EREP’s first year saw some tangible results and impacts on the ground. However, implementation during the second year was initially interrupted and later completely suspended after the deterioration of the political and security situation in the country in January 2015. As a precautionary measure, the World Bank suspended all missions to Yemen as of January 23, 2015.

Although the EREP was forced to stop the matching grant and internship grant components, both of which were recipient-executed, the project produced credible results during the first year of its implementation.

A total of 204 firms were selected to participate in the first round of the matching grant component. Of that number, 164 firms, including 23 that were owned and managed by women, completed their Business Development Plans. Favorable results on the matching grant scheme were also seen during the first phase, as 63 percent of the firms reported improved capabilities after completion of services.

Medina Industrial Coal was one of the firms that worked with EREP specialists to promote and market industrial coal as well as to enhance the quality of its products and to improve its performance. “After implementing the plan, both our production and number of clients doubled,” Khalil Dirham Alhaidari, one of the company’s managers, said.

Furthermore, during the first phase of the project, a total of 198 young Yemenis were placed in firms, of which 64 percent were employed following the completion of the internship program. In addition, 21 out of 73 youth who started but did not complete the program, later found jobs.

Positive Outcomes

While both recipient-executed components of the EREP were suspended soon after the project began its second phase with 200 firms, the impact evaluation results were successfully completed and were captured in two recently published World Bank Policy Research Working papers: • The additionality impact of a matching grant program from small firms: Experimental Evidence from Yemen • The Demand for, and Impact of Youth Internships: Evidence from a Randomized Experiment in Yemen

The working papers document the short-term impact of the EREP project and provided new encouraging evidence of the positive effects of the matching grants and internship placement programs. One of the working papers has also been accepted for publication by a peer-reviewed journal.

Among the interesting findings, the working papers revealed that firms that received the matching grants in Yemen were more likely to introduce new products or accounting systems, do more marketing, and were more likely to say their sales grew than those firms that did not receive grants. These results suggest that additionality was a result of the matching grant program.

The papers also found that the internships had a positive impact on youth participants. Receiving an internship under the EREP resulted in an almost doubling of work experience for the participants in 2014 and a 73 percent increase in income during this period compared to the control group. A short-term follow-up survey, conducted just as civil conflict was breaking out, shows that internship

recipients had better employment outcomes than the control group in the first five months after the program ended.

The encouraging results from the working papers will not only serve future projects in Yemen but will also be instrumental for further replication, learning and development across the MENA region and other developing countries.

Fortunately, the project recently received a one-year extension until December 31, 2016, from the MENA Transition Fund Steering Committee, and World Bank management has been considering options to authorize an exception to lift the suspension for a number of projects in Yemen, including the EREP.

Bank management has also been in deliberation to utilize the remaining funds to conduct further analytical and technical work on the private sector, Small and Medium Enterprises, and employment, particularly in light of a potential emergency recovery operation in the coming year.