When fo use this indicator?
It should be used by projects that target employment, or more broadly, market system development outcomes. Examples could include:
- Technical and Vocational Educational Training (TVET)
- Projects working towards agricultural commercialization, for instance by coaching agricultural producer groups
- Projects that engage in business grants
- Projects that work on improving market systems or value chains, such as agricultural input value chains.
Jobs that count under this indicator may include seasonal work, contractual work, part-time work, informal employment, and self-employment. All direct and indirect jobs need to have been verifiably created. All jobs created should be verifiable by a comparison of financial or human resource data before and after the intervention. This could take the form of an organizational chart, payment slips, work contracts, or – in the case of an individual business start-up – business cash flows. Jobs lost do not need to be verified: If a firm has fewer verifiable jobs in one year than in the last, then the difference counts as jobs lost.
This indicator includes, and disaggregates between, direct and indirect jobs. Direct jobs are jobs that are created by the firms that a project directly works with. Examples include jobs created through business grants, the strengthening of agricultural enterprises, or through business development services for small enterprises. Indirect jobs are jobs that are created in the same value chain as a result of increased economic activity of the targeted firms that a project directly works with. For instance, if a project strengthens agricultural cooperatives who then start to buy larger volumes of seeds, this might create additional jobs among seeds suppliers. Indirect jobs can also include indirect job losses: For example, it is possible that a project-supported input supplier might increase in size, which could lead to competitors to reduce their number of employees.
A full-time equivalent (FTE) job is defined as a full-time job based on 240 working days a year. Both full-time jobs and part-time jobs are converted to full-time equivalents in order to be counted under this indicator. For example, if a person works 120 days a year, that is 0.5 FTE. (120/240 = 0.5) If a person works 60 days, that is 0.25 FTE. (60/240 = 0.25). Combined, these two persons would work a 0.75 FTE. For more details, see Measuring Job Creation in Private Sector Development, a working paper by MarketShare Associates for the DCED.
Method: Data for this indicator should be collected using routine monitoring of targeted and non-targeted firms in the value chain. Projects that use this indicator should take a baseline at the start of the project. Following this, if the project lasts one year or less, an endline value should be taken at the end of the project. If the project lasts more than one year, then the indicator value should be collected at the end of each implementation year.
Questions: Projects using this indicator should ask each firm from which they collect data how many people are currently working at the firm, and how many days per year they work at the firm.
How to calculate:
- For each job at a given firm, divide the number of days that they should work per year by 240 days to obtain an individual full-time equivalent (FTEs) value between 0,00 and 1,00.
- Sum up all FTE values separately for the baseline and for the current endline or annual indicator value.
- Substract the baseline value from the endline or annual indicator value to obtain the net number of jobs created.
For more details, see Measuring Job Creation in Private Sector Development, a working paper by MarketShare Associates for the DCED.
