WASHINGTON, June 19, 2020 ¨C ľ¹ÏÓ°Ôº¡¯s Board of Executive Directors today approved a US$20 million IDA credit for the . The project will provide temporary relief to eligible workers and employers in response to the COVID-19 crisis and help provide the country¡¯s jobseekers and micro-entrepreneurs with improved access to labor market opportunities.
In Mongolia, jobs and poverty are closely linked, with highest levels of poverty among those without productive and well-paying jobs. The country has long suffered from limited job opportunities, particularly for youth and other vulnerable groups with little work experience. In addition, poor labor market transparency and incomplete information present challenges for jobseekers.
The economic downturn due to the COVID-19 pandemic has exacerbated these challenges with an increased likelihood of layoffs, fewer jobs, and lower wages for the Mongolian workforce.
The project will support the government¡¯s COVID-19 relief measures which provide temporary social insurance contribution relief for eligible employers and their workers under the mandatory social insurance scheme.
Expanding income opportunities towards more productive microenterprises and self-employment could lessen chronic unemployment and the lack of labor demand which has been made worse by the COVID-19 crisis. For this, financial and nonfinancial support will be provided to help micro-entrepreneurs start and expand their businesses. The project will also pilot an innovative skills promotion program that will help jobseekers gain skills demanded by employers.
The project will also support upgrading of selected labor and social welfare institutions to help jobseekers find jobs more efficiently. Activities will include modernization of physical infrastructure, streamlined work organizations, improvements to information systems, and better use of labor market information in decision making. In addition, it will finance activities to improve the scope, quality, and availability of labor market information for all users.
¡°Social insurance contribution relief provided under the project will help both employers and workers to recover quicker from the COVID-19 crisis without having to shut down their businesses or let go of large numbers of workers,¡± ¨C said Andrei Mikhnev, World Bank Country Manager for Mongolia. ¡°The project will also improve the transparency and efficiency of the labor market, thus helping Mongolians weather the crisis and get better jobs.¡±
The project will be built on the activities being implemented under the existing World Bank Employment Support Project, which was restructured in early May 2020.
