Investing in Youth: Peru

Foreword
Acronyms and abbreviations
Executive summary
Assessment and recommendations
	Peru faces a major challenge to help youth getting a better start in the labour market, but time is pressing
	The lack of quality jobs is an important source of concerns
	An integrated policy framework to support inclusive labour markets for Peruvian youth
	Removing demand-side barriers that hinder the willingness of the employers to hire youth
		Addressing overly complex firm regulations
		Making the minimum wage pay
		Tackling labour market dualism
		Complementary strategies to address barriers to firm creation
		Lessons from the past: The importance to strengthen social dialogue
	Improving the employability of Peruvian youth
		Raising the capacity of Public Employment Services to support activation
		Strengthening income support to unemployed youth, conditional on active job search in the formal sector
		Reducing the skills mismatch
	Specific policies for the most vulnerable youth
		Averting early school leaves
		Tackling the vulnerability of young Peruvian women
		Providing low-threshold, well-informed access to modern contraceptives
		Alleviating the motherhood penalty
		Ensuring women’s safety in public transport and related public spaces
		Gender policies can have disproportionally beneficial effects on a range of youth-specific issues
		Indigenous and Afro-Peruvian youth
		Investing in youth is an integral part of the broader policy objective to achieve better long-term economic and social outcomes in Peru
	References
Chapter 1.  The labour market situation of youth in Peru
	1.1. Introduction
	1.2. Youth make up for a large but rapidly declining share of the working age population
	1.3. Prima facie evidence suggests that Peruvian youth do not perform badly in the labour market
	1.4. However, some youth fare much worse than others
	1.5. Heterogeneous labour market outcomes are associated with low levels of well-being
	1.6. The quality of jobs for youth is poor
	1.7. Informality acts as a driver to inequality
	1.8. Portraits of young people at high risk of becoming disconnected from the labour market
	1.9. Early school leaving is an issue for concerns
	1.10. Assessing the costs of youth labour market marginalisation
	References
Chapter 2.  Removing demand-side barriers to youth employment in Peru
	2.1. Introduction
	2.2. Complex firm regulations discourage formal youth employment
		2.2.1. Youth lose most from size-contingent employers’ social security contributions
		2.2.2. Policy insights to address size-contingent social security contributions
		2.2.3. Lessons from the past: The importance to strengthen social dialogue
	2.3.  Making the minimum wage pay
		2.3.1. The framework of prudent changes of the minimum wage should be maintained
		2.3.2. Supporting decent minimum wages for youth while keeping costs in check
	2.4. Tackling labour market dualism
		2.4.1. Policy options to reduce labour market dualism
	2.5. Complementary strategies to tackle barriers to firm creation
	Notes
	References
Chapter 3.  Strengthening the employability of Peruvian youth
	3.1. Introduction
	3.2. Delivering public employment services that work for youth
		3.2.1. Few unemployed youth use the public employment intermediation services
		3.2.2. And few unemployed youth participate in other types of Active Labour Market Programmes
		3.2.3. Factors explaining the limited capacity of PES to support activation
		3.2.4. Policy options for improving the role and attractiveness of employment services
			Strengthening the capacity to reach out to young NEETs
			Tailoring services better to specific needs
			Greater capacity will be essential to deliver effective employment services
			Strengthening the training component of youth ALMPs
			Public work programmes to boost incomes and work experience
			The supportive role of certification
			Nurturing a monitoring culture
			Youth guarantees to re-engage NEETs in employment, education or training
	3.3. Strengthening income support to unemployed youth, conditional on active job search in the formal sector
		3.3.1. Unemployment insurance is not fully developed
		3.3.2. Lack of social assistance targeted at unemployed people
		3.3.3. Policy options for devising an income support scheme for unemployed youth that encourages job search
			Improving the unemployment benefit system
			Targeting social assistance at NEETs who actively search a job in the formal sector
			Using ICT to leverage the development of social protection
	3.4. Reducing the skill mismatch
		3.4.1. High prevalence of over-qualification and field-of-study mismatch
		3.4.2. Reasons behind Peru’s skill mismatch
			Higher school enrolment and educational attainments but low quality education
			Sluggish demand for high-skilled labour
			Assessing professional shortages and surpluses
		3.4.3. Policy options for reducing over-qualification and the field-of-study mismatch
			Supporting better education and career choices and delivering evidence-based policy making
			Improving co-ordination to achieve better skills outcomes
			Building partnerships to ensure that policies are responsive to changing skills needs
			Complementary policies to support the demand of quality jobs for youth
	Notes
	References
Chapter 4.  Specific policies for the most vulnerable youth
	Introduction
	4.1. Which socioeconomic characteristics predict economic vulnerability among Peruvian youth?
	4.2. Early school leavers
		4.2.1. Improving the perceived benefits of schooling nationwide
		4.2.2. Decreasing the opportunity cost of sending children to school
		4.2.3. Enhancing the quality of early childhood development
			Children below three years
			Pre-schooling for children above three years
		4.2.4. Interactions with nutritional objectives
		4.2.5. Developing key non-cognitive skills
		4.2.6. Scaling up strategies to counter negative self-stereotyping by poor students
	4.3. Women
		4.3.1. Preventing teenage pregnancy is a key priority challenge in Peru
			Investing in girls’ education
				Extended school-hours programmes
				School-based sexuality education programmes
		4.3.2. The composition of the audience also matters.
		4.3.3. Alleviating the motherhood penalty
			Ensuring that all mothers benefit from a decent maternity leave
			Improving children’s access to early childhood education and care
		4.3.4. Ensuring women’s safety in public transport and related public spaces
		4.3.5. Moving towards greater gender equality requires the support of a change in mind-set
	4.4. Indigenous and Afro-Peruvian youth
		4.4.1. Improving educational attainments and job opportunities of rural indigenous youth
			Boosting educational attainments
			Boosting job opportunities
		4.4.2. Combating discrimination against indigenous and Afro-Peruvian people
	Notes
	References
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