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Key Approaches to Labor Market Assessment:
An Interactive Guide
Module 4: Systems & Stakeholders
Tools and approaches in this section help the user better understand both the labor market system itself as well as the larger systems within which the labor market is functioning. They can also help to identify the factors that may be contributing to suboptimal labor market functioning, and leverage points and strategies to address those factors. Jump to the full Module 4.
Why are these tools and approaches important?
Systems tools can help donors, implementers, and other stakeholders understand which problems might best be addressed through workforce development—and which through education system strengthening, poverty reduction, economic growth programming, private sector development, labor market policy reform, or any of the other key areas of development.
Approach 4a: Causal Loop Modeling Tool
A causal loop model is a free-form map that shows causal relationships between variables in a system, and uncovers gaps between actual performance and desired performance. The act of building a causal loop model and recognizing the root causes and patterns can help policymakers and implementers identify potential places to effect change in a system. This tool may be used at the outset of an LMA with labor market stakeholders, to define key areas of investigation. It may also be used before or after carrying out an LMA—before, it may also be used with a donor or donors to identify whether there is a need for an LMA; afterwards, the LMA may inform causal loop modeling as donors, implementers, or other stakeholders construct a theory of change. Jump to the full Approach 4a.
Causal loop models help us to make explicit our understanding of how different factors are interacting to cause specific results in a system. This tool, which has been adapted and simplified for the purposes of this toolkit, can be used to identify root causes of problems, in order to spur a thinking process about a system.
How do I use this tool?
For an in-depth how-to on constructing a causal loop model in your own context and understanding the characteristics of balancing loops and reinforcing loops, key components to a causal loop model, click to learn more.
Background on systems dynamics, causal loop modeling and its uses
Meadows, D. H., & Wright, D. (2008). Thinking in systems: A primer. Chelsea Green Publishing.
Mostashari, A. (2013). Systems Thinking in International Development. USAID Training, October 9-11.
Williams, B., & Hummelbrunner, R. (2010). Systems concepts in action: a practitioner’s toolkit. Stanford University Press.
How-to instructions for drawing causal loops
Kim, D. H. (1992). Guidelines for drawing causal loop diagrams. The Systems Thinker, 3(1), 5-6.
Details on causal loop structures and archetypes
Continuous Improvement Associates. (2003). “Systems Thinking Archetypes (Generic Structures).“
Senge, P. M. (2006). The fifth discipline: The art and practice of the learning organization. Broadway Business.
Approach 4b: Social Network Analysis
Social network analysis (SNA) is a set of analytical and visual tools that allow implementers and policymakers to understand the patterns and dynamics of social capital, which are “the institutions, relationships and norms that shape the quantity and quality of social interactions” (World Bank). Jump to the full Approach 4b.
Source: LINC. (2015) “Organizational Network Analysis – Nicaragua Workforce Development System.” Report. September”
Why is this tool important?
Determining the dynamics of social interactions ultimately allows practitioners to select appropriate and efficient pathways for intervention in the labor market or workforce development system, as well as anticipate its potential reach.
How do I use this tool?
In the context of an LMA, a simple SNA would identify the key stakeholders in the system and the degree to which they coordinate to the degree necessary, as well as identify emerging sources of social capital where new approaches may be gaining momentum.
Analysis of the changes in a network over time is especially useful for monitoring and evaluation. Improvements over time in the number and quality of linkages, and especially the emergence of hubs and new segments may serve to validate predicted intermediate outcomes. Network visualizations can also lead to qualitative insights into emerging network dynamics. Learn more about the steps needed to develop this tool.
Where can I find more information about this tool?
Borgatti, S. P., Everett, M. G., & Johnson, J. C. (2013). Analyzing social networks. SAGE Publications Limited.
Giuliani, E., & Pietrobelli, C. (2011). Social network analysis methodologies for the evaluation of cluster development programs. Inter-American Development Bank.
Where can I find additional approaches and tools to understand systems and stakeholder?
A number of other tools and approaches can be used to understand the systems in which labor markets function. Several of these are detailed in a USAID Bureau of Policy, Planning and Learning (PPL) technical note providing guidance for using the 5Rs Framework, “a practical methodology for supporting sustainability and local ownership in projects and activities through ongoing attention to local actors and local systems,” in the program cycle. The 5Rs stand for what USAID PPL considers the five key dimensions of systems: Results, Roles, Relationships, Rules and Resources.
The International Labour Organization’s Employment Diagnostic Analysis: A Methodological Guide describes an “employment diagnostic reference tree,” which starts from “a broad array of often interrelated factors” to funnel down through “a structure process of elimination and disentanglement of causal links” that “results in a stepwise narrowing down of the focus and in the identification of core constraints, challenges, and opportunities for inclusive job-rich growth.”
RTI has developed a Workforce Development Ecosystem Assessment tool for mapping complex workforce development systems and diagnosing their performance from a stakeholder perspective. RTI intentionally took an “institutionally agnostic” approach to this mapping, choosing to focus on functions and processes rather than certain institutions or individuals.
Workforce Connections has also developed and supported the development of additional systems tools in the labor market or workforce development context. For example, during the process of a labor market assessment, Workforce Connections creates a stakeholder map to determine the main actors in each of five groups (government, donors and implementers, education, employers, and the workforce), and the intermediaries that connect them. This also serves the purpose of showing where the introduction of new stakeholders or intermediaries might help the system function better.