During the nineties, many governments in Latin America implemented ambitious reemployment programmes for workers displaced by economic restructuring and technological change. These programs were aimed at assisting low-income redundant workers in rapidly finding the best new job possible. The two main reasons behind the need of implementing such programs were the imperfections of the labour market in terms of economic efficiency (caused by the economic restructuring programs and the technological change) and the social equity issues that arose as a consequence of those imperfections.

Although well intentioned, many of the reemployment programs seem not to have achieved their main goals. Even though accurate evidence is missing, there is a lot of partial data that suggests a wastage of public resources and a poor cost-effectiveness relation in many cases. There are different indicators of failed results that shows the complexity of the problem of displaced workers and enhances the need to extreme the care in the design and implementation of public reemployment programmes. The most common failures refer to the following aspects:

• Difficulty to attract and retain participants. Some programs have had to be reduced or discontinued either for lack of interest of the eligible workers or because there were not enough eligible workers fulfilling the requirements of the programmes.
• Low employment rate of the participants in good jobs. Sometimes the reemployability of the participants is hindered simply because the entire economy is in recession and there are not enough alternative jobs available.
• Excessive or unnecessary expenses. In some cases the crisis which caused the labour redundancy problem was transitory and the workers could return to their old jobs after a while. In other cases, public retraining programmes proved unnecessary because the employers of the workers would have been able to finance the necessary service.

Despite these facts, it is better to think that these failures do not deny the potential benefits of public programmes for reemployment, but rather that they provide important lessons and signs of alert regarding the risk that should be prevented when designing or implementing these programmes, in order to maximise its efficiency and avoid unnecessary costs.

Based on the experience of many public reemployment programmes carried out in Latin America, it is possible to extract some valuable lessons which can be summarised in the following principles:

1. Public reemployment programmes are justified only when these initiatives produce benefits for society as a whole, either in terms of a national productivity gain or improved social equity.
2. Not all displaced workers need or merit public assistance to find a new job. Subsidised public programmes for reemployment should be directed to low-income workers whose specific human capital has become obsolete and who fulfil the requirements to participate in the programmes.
3. The characteristics of employment crisis and of the individual workers affected by them are very diverse. Thus, strategies of assistance for reemployment that are effective in one situation may not be so in an other.
4. Retraining is not the only nor necessarily the best public instrument to aid displaced workers. More successful strategies generally include a package of different services, such as: employment information and guidance, employment intermediation services; loans and grants for purchasing equipment and housing goods; tax relief or labour costs subsidies for potential employers.
5. The design and implementation of public programmes for reemployment should be carried out within the framework of an adequate budget and according to legal and technical norms allowing the timely provision of quality services to displaced workers.
6. Labour unions and employers organisations have proved to be valuable strategic allies for the design and implementation of public reemployment programmes.

In sum, the design and implementation of public programmes of assistance to reemployment of workers displaced by structural changes in the economy, is a complex task very prone to costly errors, the consequences of which are the frustration of the beneficiaries and the wastage of public resources.

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* Eduardo Martínez Espinosa, Experiences in retraining programmes in Latin America. Montevideo, ILO/Cinterfor, 1997. (Not published yet).