Through the EUR 3.3 million project “Support to Employment Policy to promoting job creation in Mongolia”, a Human Dynamics’ led consortium for 48 months will provide dedicated technical assistance to strengthen the policy framework and support the delivery of Mongolia’s National Employment Policy 2014-2025.
Compared to other countries around the globe, Mongolia enjoys a relatively low rate of unemployment. However, these figures are deceptive. They mask a high rate of under-employment, with talented individuals locked into low productivity jobs either in informal employment or traditional animal husbandry. These positions generate insufficient income to lift employees out of poverty. For Mongolia to continue nearly a decade of strong economic growth, labour market reform is needed.
The Mongolian government has identified this issue and created the instrument to address it, the National Employment Policy 2014-2025. The policy seeks to correct a fundamental mismatch in Mongolian labour market dynamics between labour supply and demand. The mismatch has been caused by the relatively rapid changes underway across the entire country with a high rate of urbanisation and a high economic growth rate coupled with a young demographic profile and a relatively recent tertiary sector.
Mongolia has a young population, 58% were below the age of 30 in 2014, which presents a huge opportunity. The youth of today are tomorrow’s workforce. Young people interviewed in the ILS-RAND Youth Survey* indicated a strong desire to work, and a desire for a job where they could build their skills. Almost 25% of youth are unemployed, but Mongolia has almost universal literacy, high enrolment in a rapidly growing tertiary education and good access to communication technology.
The high unemployment rate amongst young Mongolians is indicative of a new tertiary sector that currently is offering an education that does not always skill graduates in the necessary areas for the countries rapidly growing and modernising economy.
A boom on the steppes
In the last decade, Mongolia has grown by an average of over 9%. This growth has been fuelled by the exploitation of the country’s extensive mineral deposits. Mongolia has some of the world’s largest copper mines. The mining sector has dramatically transformed an economy that traditionally was composed of semi-nomadic herding and agriculture across the vast steppes. But while mining provides 90% of the nation’s exports and a considerable part of its income, it only employs 4% of the workforce. Mining, however, does not totally dominate the economy. The key to unlocking future growth in Mongolia will be to upskill and grow the country’s non-mining sectors. One particularly exciting opportunity is capitalising on Mongolia’s cashmere industry. Mongolia currently produces a third of the world’s supply of cashmere. The benefits of this industry could grow further if secondary processing was done in the country, rather than the current practice of simply exporting the raw product.
Driven in part by the fundamental changes underway in Mongolia’s economy, currently, half of the Mongolian workforce is concentrated in the capital, Ulaan Baator. This is the result of a period of rapid urbanisation as people, particularly recent graduates move to find better opportunities. This shift in demographics has created a demand for employment opportunities in urban centres, primarily in Ulaan Baator. This shift has changed the labour market in Mongolia.
Human Dynamics and our consortium partners have considerable experience in building the capacity of the public sector and facilitating employment opportunities. Our team in Mongolia will focus our efforts on delivering on three key pillars:
The project will engage two key experts who will support the further elaboration of the National Employment Policy and the supporting legislative framework, as well as its implementation. Our team will assist in building capacity within ministries and support the evaluation of existing initiatives. Facilitating the necessary reforms is not solely the responsibility of the public sector. Our team shall also support the associated civil society organisations who contribute to the policy process to build their capacity and their engagement. Finally, as with all Human Dynamics projects, we shall work to build synergies with other donor projects to magnify the impact of our technical assistance, reduce duplication and ensure value for money.
This project is an opportunity for Human Dynamics to contribute to improving the employment opportunities for young Mongolians. Our Project Director, Mr Rade Glomazic said, “This is an opportunity for Human Dynamics to support Mongolia during an exciting phase of the country’s development. By addressing labour market reform Mongolia will be able to unlock another decade of strong economic growth. We are looking forward to providing whatever help we can along this journey.”
This is an opportunity for Human Dynamics to support Mongolia during an exciting phase of the country’s development.