Does strengthening financial sectors in frontier markets stimulate good jobs?
A new framework developed by The Good Economy is being used to understand how financial sector development in sub-Saharan Africa can stimulate more and better jobs.
FSD Africa aims to reduce poverty by building financial markets that are efficient, robust and inclusive. The framework, developed in collaboration with Tandem, provides a holistic approach to capturing the job quantity, quality and inclusion effects of FSD Africa’s work – including through its use of early-stage, risk-bearing capital.
A blog co-authored by The Good Economy outlines how FSD Africa – together with the wider network of FSD Programmes across Africa – is shifting to a new strategy which emphasises jobs both as a pathway out of poverty and as a driver of long-term economic transformation.
The framework allows the FSD network to measure the effects of their work by tracking how many jobs are being supported, for who and in what conditions. It integrates a unique ‘decent jobs assessment’ to provide a portfolio-wide view of the type of jobs being supported – based on levels of earnings, job security and progression opportunities – as well as the relative need for these jobs, using a suite of SDG 8 aligned indicators.
Matt Ripley, head of impact services at The Good Economy, led the team behind the framework. He said: “We know measuring job effects can be tricky to do well, particularly for market and institution building initiatives that have indirect routes to impact.
“The sector-level profiling in this framework allows for a more nuanced qualification of a programme’s overall jobs numbers, recognising the complex interplay between dimensions of job quantity, quality and inclusion in markets characterised by a high degree of informal employment”.