The project entails a four-year program that will target 6,500 children living in three of Peru's poorest rural regions -- Huancavelica, Pasco and Junín -- where child labor is common practice.
Exploitative child labor in Peru is most prevalent in agriculture, commerce, domestic service and mining, read a statement from the U.S. DOL.
It contributes significantly to the social and economic exclusion of impacted children and families.
The project aims to fund training and assistance for rural Peruvian families to increase incomes without the use of child labor, while expanding access to education and vocational training for children, as well as helping at-risk communities to organize and partner with government institutions to improve public services.
Among Peru's large rural population, child labor is considered both an economic necessity for impoverished families as well as a traditional aspect of family life, factors which contribute to Peru's status as having one of the highest child labor rates in world.
Since 2001, the Peruvian has established the legal working age at 14, though judges can make exceptions for children as young as 12 to work provided that the labor is light and does not interfere with the child's personal and physical development, stipulations that remain unspecified.
Despite Peru's labor laws regarding children, 34 percent of children (over 2 million), ages 5 to fourteen, are believed to be engaged in child labor, 61 percent of whom live in rural areas, according to the United Nations Children's Fund (UNICEF) based on 2007 figures.
The global average for child labor in that age bracket it is estimated at 12.6 percent, according to the U.N. International Labor Organization based on 2008 figures.
Children are not 'short adults.' They are people who have to forge their personal development, culture and future, and this future can only come with education, Carmen Moreno, ILO director for the Andean Region, told the BBC in May.
No matter how many hours children work, it stops them from attending school regularly. And this is dangerous for their personal development.
The DOL grant was awarded to Ecuador-based NGO Desarrollo y Autogestión (DYA), which will lead the project in collaboration with U.S.-based NGO World Learning, Inc. and Peruvian NGO Centro de Estudios y Promoción del Desarrollo (DESCO).