mongolia has made progress in expanding education and improving youth skills, but labor market opportunities have not kept pace, leading to challenges in school-to-work transitions. key findings include:
- labor market performance: mongolian youth face slow, unequal, and often unstable entry into the labor market, with youth unemployment at 13% and one in seven young people not in employment, education, or training (neet). employment is primarily in urban areas, small enterprises, and low-wage sectors.
- risks and pathways for neet youth: the average neet rate for mongolian youth is 16%, with significant age and gender disparities. young women, in particular, face high inactivity rates driven by family and childcare responsibilities. regional disparities are also pronounced, with remote and resource-dependent areas having higher neet rates.
- returns to schooling and wage inequality: while education is still associated with higher wages, returns to schooling have declined sharply, from 8.2% in 2013 to 4.3% in 2023. this suggests a mismatch between educational attainment and labor market demand, potentially leading to underutilization of educated youth.
- school-to-work transitions: only about 39% of young people are employed within the first year after leaving education, with transition times varying by sector, gender, and education level. young female mongolians take longer than young men to secure jobs, with higher churn rates and lower job satisfaction.
- job tenure: young people tend to have shorter job tenure and more frequent job changes than older workers, often cycling through short spells of work and inactivity. workplace culture, job stability, and nonwage attributes are highly valued by young workers, even over higher wages.
- employment facilitation services: public employment services (pes) have expanded but face challenges in governance, financing, and delivery. low awareness of pes, limited capacity, and a mismatch between service provision and youth needs hinder effective support.
recommendations include shifting focus from first job placement to facilitating transitions into decent jobs with retention, targeting neet and unemployed youth with differentiated approaches, improving labor market outcomes for educated youth through structured work-based learning and employer support, and establishing an outcomes-focused monitoring and evaluation system for pes.
