Multilateral development banks adopt common framework to measure job creation impact

A coalition of leading Multilateral Development Banks (MDBs) has announced a new collaborative initiative aimed at developing a common approach to measuring the impact of their operations on job creation and workers’ earnings across developing and emerging economies.

In a joint statement, the institutions said the move is designed to strengthen coordination among development lenders, governments, private sector partners and other stakeholders in promoting more and better jobs.

The banks said the initiative would deepen cooperation across countries and institutions while improving how employment outcomes from development projects are assessed.

According to the statement, the framework will be iterative and refined over time based on lessons learned, evolving best practices and the individual mandates of participating institutions.

The MDBs also said the process would be guided by continued engagement with stakeholders, including the International Labour Organisation (ILO), to ensure that the quality of jobs created remains central to the discussions.

“Our goal is to advance our collective understanding of the best pathways for job creation and workers’ earnings in each region and context, to help drive growth and improve livelihoods in our countries of operation,” the statement said.

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The institutions noted that creating jobs remains one of the most effective tools for reducing poverty, strengthening social cohesion and limiting economic vulnerability, particularly in low- and middle-income countries.

They stressed that beyond the number of jobs created, attention must also be placed on the quality of employment, including income levels, job security, working conditions and opportunities for advancement.

Under the new arrangement, participating banks plan to use the common framework to improve policy dialogue with governments, strengthen project design and better track the employment outcomes of investments financed across sectors such as infrastructure, agriculture, energy, manufacturing, education and digital services.

Development finance experts have increasingly called for stronger measurement standards to determine whether large-scale public and private investments are translating into sustainable employment gains.

Analysts said the new initiative could help harmonise reporting standards across institutions, reduce duplication and provide clearer evidence on which interventions generate the greatest labour market benefits.

The announcement comes at a time when many developing economies are facing high youth unemployment, widening inequality and the need to create millions of new jobs annually to match rapid population growth.

The participating institutions include the African Development Bank (AfDB), Asian Development Bank (ADB), Asian Infrastructure Investment Bank (AIIB), Caribbean Development Bank (CDB), Council of Europe Development Bank (CEB), European Bank for Reconstruction and Development (EBRD), European Investment Bank (EIB), Inter-American Development Bank Group (IDB Group), Islamic Development Bank (IsDB), New Development Bank (NDB), and the World Bank Group (WBG).

Observers said the combined financial reach and policy influence of the MDBs could make the initiative a significant step toward placing employment outcomes at the centre of global development finance.