What Works

Latin America and the Caribbean have achieved significant economic, labor market, and social progress in recent decades. However, progress has begun to slow on a number of fronts that will challenge the ability of policy-makers to sustain these gains. In this context, active labor market policies (ALMPs) can play a central role by improving workers’ employability, contributing—directly or indirectly—to productive employment creation. A number of Latin American countries have embraced this policy shift and, as a result, there has been a marked increase in public expenditures on ALMPs in the past two decades.This new report, part of the Studies on Growth with Equity series, examines the effectiveness of ALMPs implemented in Latin America. After reviewing the main labor market and social trends in the region, the report presents a new comprehensive compendium of ALMPs implemented in selected Latin American countries during the last twenty years. It also discusses the results of a systematic review of existing evidence on ALMPs in the region and provides new findings on what works in this area, notably an assessment of policies carried out in Argentina, Colombia, and Peru.