Historically, there’s been little consensus on whether publicly-funded skills development and TVET (Technical and Vocational Education and Training) programs are good value for money. These programs, which are often designed to train individuals who are interested in highly technical or hands-on occupations or trades, can be a critical aspect of building up local and national economies. So, while some work has been done to identify what good skills development looks like, there is not yet a best-practice approach to implementing it.

Skills for Prosperity, a UK aid-funded and Palladium-implemented program to create more robust education to employment pipelines, is coming to an end December 2023. The program recently commissioned research to test its own lessons, experiences and wider assumptions about effective program design.

“There are different implementing partners in each country, overseen and supported by the Skills for Prosperity Hub, which provides technical expertise and program management services,” explains Tracy Ferrier, Palladium’s Team Leader for the Skills for Prosperity Hub. “One of the Hub’s objectives has been to learn from the experience of delivering Skills for Prosperity to inform the design of future skills programs.”

Reflecting on the breadth of Skills for Prosperity and recognising that there are many ways to support inclusive economic growth, the Hub wanted to contribute to the global evidence base to determine which types of projects have the greatest impact. Since the Skills for Prosperity programs in each country have only recently ended, it’s too early to draw on Skills for Prosperity data – which is why the research was commissioned.

This isn’t the Hub’s first research report. Investing in TVET and Skills Development found that the main driver for investing in skills development is to support economic growth, rather than to address systemic issues in TVET and skills development itself. “Part of the reason for this new research is to investigate if this shift reflects the available evidence on impact and if there are particular project features that are more likely to determine success,” adds Ferrier.

The research, conducted by Mike Dawe and Matilda Gosling, involved using evaluation evidence from public databases for skills development projects funded by Asian Development Bank (ADB), FCDO, and World Bank. “The overall purpose of the research was to improve our understanding of what works, in order to inform the future design of, and investment in, skills development programs,” Ferrier says. “The research methodology involved testing two central theories related to the design and development of skills programs.”

The Findings

The first theory is that project approaches can be categorised into two types: National TVET Policy and Place-Based. Projects that achieve impact by reforming national TVET policy are categorised as policy-led projects. Those that achieve impact through responding to the specific needs of identified locations to target local economic development are categorised as place-based.

The second theory is that place-based approaches are likely to have greater impact than national TVET policy approaches. This assumption was made on the basis that place-based approaches should mean there is a better understanding of what is needed on the ground to make a difference, along with stronger and more integrated stakeholder relationships. It was expected that a more localised approach that involves people working together on opportunities and challenges can succeed even if national policy is weak or the changes required at national level are slow to be implemented.

“One surprising finding was that place-based projects do not appear to perform better than policy-led projects,” reports Ferrier. “While this finding meant that our theoretical framework was not completely correct, it was also pleasing to know that the research findings helped to correct our assumptions. We therefore hope that the results will be useful for donors and other international organisations, as they may have held the same assumptions.”

One reason for this finding could be that place-based projects are more likely to involve work-based learning. As this tends to be used for people already in employment, it could mean that the way in which impact is measured leads to unimpressive results on paper. For example, Ferrier explains, the impact will be more incremental than it would be for projects enabling individuals to move from training into employment.

“Another notable finding was that the project results that were reviewed demonstrated relatively high impact,” Ferrier continues. “The project results benchmarked well against non-skills projects funded by ADB, FCDO and World Bank. It is also helpful to designers of future programs that certain features were identified in the research that are associated with high performance.”

These features include focussing on specific industry sector, including skills development as one component of multifaceted projects, using funding mechanisms to incentivise changed behaviour and including training as a project input. The results reviewed in the research indicate that the complexities of multifaceted projects can be managed by focusing on specific sectors and geographies and by incorporating place-based project approaches.

As the program comes to a close, Ferrier notes that it’s encouraging that the research findings suggest that the team’s work in skills development actually is a good investment for donors and governments. “This has certainly been our experience in overseeing the outcomes and impact delivered by Skills for Prosperity since 2020,” says Ferrier. “The report is an important and useful final output for Skills for Prosperity and we are finishing on a positive note.”

The new research is summarised in our recently published research report- Policy-led Versus Place-based Approaches to Skills Development: Which Works Best?