Jobs: The Most Effective Pathway Out of Poverty

Driving Job Creation to Build Prosperous and Resilient Communities

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More than just a source of income, jobs provide dignity and purpose. Giving people the means to support themselves and their families can help lift entire communities out of poverty and foster economic stability.

The World Bank Group recognizes that job creation is one of the most urgent development challenges of our time. Over the next decade, 1.2 billion young people in developing countries will enter the workforce, yet only 420 million jobs are projected to be created. To address this gap, we are taking a comprehensive three-part approach: establishing the infrastructure foundation for jobs through IBRD and IDA investments in health, education, and basic services; working with governments to create predictable regulatory environments that enable business growth; and mobilizing private capital to expand businesses and drive demand for labor.

As the private sector arm of the World Bank Group,  IFC  is evolving to drive impact in this third critical area through four interconnected approaches: enhancing our ability to mobilize private capital at scale, scaling up equity investments in high-growth businesses, expanding support for Micro-, Small, and Medium-sized Enterprises (MSMEs) that employ most workers in developing economies, and transforming how we operate to maximize our impact.

Through focused investments in high-potential sectors—infrastructure, agribusiness, primary healthcare, tourism, and value-added manufacturing—we're strategically deploying capital where it can maximize both development impact and job creation, supporting our mission of a world free of poverty on a livable planet.

With 1.2 billion young people around the world reaching working age over the next decade and only about 420 million jobs expected to be generated, the need for job creation to help fight poverty and drive development has never been greater.  

Regional Focus

Africa

Over the next three decades, Africa will experience a projected net increase of 740 million people. Up to 12 million youth will enter the labor market annually during this time, yet only about 3 million new formal wage jobs are currently being created each year. The private sector generates an estimated 90 percent of jobs in Africa, yet many businesses remain small and are unable to access the finance, support, infrastructure or markets they need to grow and create jobs. IFC is supporting job creation in the region through a combination of direct investments in SMEs, indirect investments through financial intermediaries, and advisory support and skills development to help entrepreneurs strengthen and scale their companies. 

Asia Pacific

1.3 billion of the world’s 2 billion informally employed workers live and work in the Asia and Pacific region. Informality limits income and economic stability, as many informal jobs are in small firms with limited growth and productivity potential.

Women’s participation in the labor force is also notably lower in the region, only 58 percent, which has been declining, despite an overall labor force participation rate of 66. A productive private sector can create more and better jobs that raise living standards. IFC supports this transformation by promoting technological change, fostering new businesses and entrepreneurship, and expanding job opportunities, particularly for women and youth.

Europe

Labor markets in Europe have improved but structural issues, such as an aging and shrinking population and the challenge of finding the right skills for private sector jobs, persist.

EU accession and related reforms have driven economic growth, higher labor force participation, and employment in the region. Resulting in unemployment rates in the EU declining to 6 percent in 2023 from 10 percent in 2015.

With the private sector generating nine out of ten jobs in developing countries, IFC's support for businesses is crucial in creating the employment opportunities that transform lives and communities.

Latin America and the Caribbean

The private sector is a powerful engine for job creation in Latin America and the Caribbean, with Small and Medium-sized Enterprises (SMEs) accounting for nearly 60 percent of all employment in the region and making up 99.5 percent of businesses. When supported with access to finance, skills, and markets, SMEs have the potential to create millions of formal, quality jobs and drive inclusive economic growth.

The SME finance gap in the region is estimated at over $1.8 trillion, limiting growth and job creation potential. IFC is working with private sector partners to scale SME financing, promote formalization, and close skills gaps—unlocking new employment opportunities for women, youth, and underserved communities.

Middle East, Central Asia, Türkiye, Afghanistan, and Pakistan

Across the Middle East, Central Asia, Türkiye, Afghanistan, and Pakistan, the workforce is expanding as the population grows, but job creation is not keeping pace, particularly for young people and women.

Jobs and livelihoods are at risk as much of the region lies in harsh climate zones, where rising temperatures exacerbate water stress, rainfall is becoming more variable, and climate disasters such as droughts and floods are increasing in frequency.

IFC’s work around enabling local businesses to access global markets and facilitating the entry of global corporations into the region has been instrumental in creating new job opportunities, transferring skills and knowledge to offer “quality jobs” to an underemployed youth.

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