Can soft-skills training improve business outcomes of microentrepreneurs?

Entrepreneurship is the heartbeat of small business growth and innovation. Therefore, many initiatives attempt to improve entrepreneurs’ skill sets as a way of improving productivity in micro-, small- and medium-sized businesses, which would lead to faster growth.

The IDB’s strategy is focused on increasing the relatively low productivity of Latin America and the Caribbean, which has been well documented. One paramount question that arises from such a strategy is whether relevant soft skills could be boosted enough to transform micro-entrepreneurs into the type of innovative agents that would lead to a more productive society.  The fact that billions of dollars are spent subsidizing business-training programs around the world indicates that policymakers and donors believe that such a transformation is possible.

Unfortunately, a recent study of entrepreneurs in Jamaica, published in World Development, shows that while soft skills can be boosted, such initiatives may not translate to improved sales and profits over the long term. The study was implemented by the Jamaica Business Development Corporation, Development Bank of Jamaica, Inter-American Development Bank, IDB Invest, and the IDB Lab and focused on soft-skills training within a Jamaican context. Read more.