2. VIEWS ON TRAINING FOR THE INFORMAL SECTOR
2.4 Summary: main issues
While some of the mistrust displayed by Governments towards the informal sector has remained, much has also changed in the past 20 years. The governments in many de- veloping countries are now taking a far more positive stand towards small scale economic activities. In fact, forced by economic realities, they are now banking on employment cre- ation in the informal sector.
From the literature a large number of outstanding issues in relation to training and support for self-employment and IS operators can be identified. They can be grouped in the following areas: training systems, training organization and delivery, post-training as- sistance, and institutional matters.
2.4.1 Education and training systems
It is clear that the existing capacity for training for those engaged in the informal sector is insufficient. Some therefore argue that public sector VTIs should focus more on the provision of training and support for informal sector operators, while others are sceptical about such a re-orientation for VTIs to include a target group which it tradition- ally does not view as natural clients. Neither are there any clear answers to the question about funding for self-employment training.
Traditional apprenticeship training, which brings no cost to the community thus ex- erts considerable appeal. It is also noted to bring various other advantages that result mainly from the fact that the training is rooted ‘in the world of work’ and includes the mastering of technical and business skills as well as building up relevant networks. At the same, it is acknowledge to have a number of serious weaknesses that warrant interven- tions. Little is found on specifics with regard to such interventions except that utmost care needs to be taken so as not to upset the intricate balance within the system.
A major issue that becomes clear from this literary review refers to the urgent need to upscale training interventions and link them with other support programmes.
2.4.2 Training organization and delivery
There is general consensus that training for the informal sector needs to be differ- ent from the rigidly structured and examination-based long-term training provided in the past. Rather, the training courses should be short and modularized, a mixture of technical and business skills, and conducted in evenings and weekends. The literature emphasizes an active role for the clients themselves: they are said to value training, know what training they want and should be involved in the design and implementation of the courses.
While a number of studies on the informal sector clearly emphasize the importance of technological development in the sector (e.g. King 1996 and Maldonado and Sethuraman 1993), no clear link emerges on how to link technical skills training to the in- troduction of new production techniques and improved product designs.
2.4.3 Post-training follow-up assistance
It is universally acknowledged that training by itself will not create (self-) employ- ment and that other support services and in particular financial support is needed for the training graduates to engage in self-employment and set up an informal sector venture. At the same time the literature appears to be generally in favour of a ‘minimalist’ approach, as integrated packages have been proven too costly (and therefore unsustainable) and complex to manage (especially for training institutions). The general suggestion is for MSE support organisations to ‘network’, but no clear guidelines on how to initiate and operate such joint delivery of services have emerged.
For some observers the issue appears to be already largely solved by giving promi- nence to informal sector apprenticeship training, in which the apprentices build up so- cial networks which can later on be tapped to overcome a variety of socio-economic obstacles. Precious little is known about such networks, how they are constructed, what the role of (informal) apprenticeship training is, and how the process can be externally stimulated.
2.4.4 Institutional matters
One of the most prominent outstanding issues concerns the funding of training for the informal sector. No clear answers are provided by the literature on the origin of the funding for such training. Again, many appear to bank on enterprise-based training sys- tems in which the cost of the training is shared between the one hand employers and mas- ters and on the other hand workers and apprentices. Still, even in such systems the costs of interventions to improve the quality of, for instance, the traditional apprenticeship train- ing, will have to be financed in some way.
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One of the more interesting innovations addressing both the issues of cost-sharing and the involvement of non-public training providers are training voucher schemes (e.g. in Paraguay and Kenya). Essentially this modality aims to strengthen the market relation- ship between training customers and suppliers. The MSEs can purchase training vouch- ers, e.g. at a discounted price, from a government (or another) agency. The voucher entitles the entrepreneur to follow training in any of the pre-qualified training institu- tion, from public, non-profit and for-profit sectors. The providers can exchange the vouchers after the course has been completed and the trainee has completed a minimum part (e.g. 75%) of the course. The small producers decide for themselves which -short- course is best addressing their needs. Unpopular courses which are not chosen or which have high drop-out rates, are gradually disappearing as the providers try to receive maxi- mum benefits from the vouchers.