Unemployment reaching a critical level in Bangladesh

Faruque Ahmed

The unemployment situation has been worsening in Bangladesh particularly over the past two years, as per estimates by various research organizations, at a time when about two million new faces are joining the country’s work force annually.

Some estimates suggest that nearly one-third of Bangladeshi youth are either unemployed or underemployed, leaving a large chunk of 60.7 million potential labour force of the country unutilised or underutilised. At the same time, over two lakhs foreign workers are working in the country, mainly in garments, ICT and service sectors, in jobs for which sufficient number of qualified manpower is available in the country.
Some experts blame the mismatch between quality of education and demand for appropriate employment as the reason for several lakhs graduates remaining unemployed after coming out from the universities and colleges annually. They say the industry is also increasingly requiring to recruit foreign workers to meet demand for skilled and semiskilled labour. They say skill development in a planned manner is necessary not only to meet industry demands, but also to reduce petty crimes, drug addiction and human trafficking by lure of vague promises for employment abroad.
Bangladesh Unemployment Scenario
During the calendar year of 2014 and 2015, the country generated only 6 lakh jobs, 3 lakh annually on an average, leaving a vast number of unemployed persons among 2.0 million eligible youths entering job market every year. In the previous years, between 2003 and 2013, the annual average employment generation was 13.8 lakhs nationally, according to research output of the Centre for Policy Dialogue (CPD).
“Implications are worst…. high rate of unemployment results in risky migration, and of course drug-addiction and crimes. But, the government alone cannot solve the unemployment problems,” researcher Towfiqul Islam Khan said.
Khan blamed the country’s education system which is not pro-employment. He said. “Industrialists say they are not finding skilled people. But, you see we are having some 2.0 million new job-seekers every year. Where is the gap? ….the gap lies with our education system.”
Khan said the public sector is progressively generating smaller number of regular jobs annually. He suggested that at least the government could extend policy support to the private sector to generate more employment by labour-intensive industrial expansion.
Under the national social security strategy implemented through Annual Development Programmes, the government’s spending on employment generation in the rural areas was Tk 1400 crore in  2013-14 and Tk 1500 crore each in FY15 and FY16. It is possible for the government to expand allocation for job creation in the rural economy, while the private sector could go for expansion of commerce & industry in suburban and rural townships to bring jobs to the doorsteps of the common people.
In Bangladesh, public sector employment is low in spite of high level of expenditure. The private sector is the biggest employer now but facing many setbacks and unable to go for new investments. The country’s private investment was low over last several years largely on account of political instability, and high rate of interest on bank credit.
Women entering job-market
More female workers are also entering the labour market with the rise of education among women. Experts say new policy focus must aim at creating more jobs for women in manufacturing and other service sectors.
According to Labour Force Survey 2013 released in October 2015 by Bangladesh Bureau of Statistics, the country’s total population stands at 154.1 million, of which 77.5 million are female.
The number of economically active populations (aged above 15 year) is 60.7 million, out of whom 42.5 per cent are male and 18.2 per cent are female. BBS says unemployment rate came down to 4.3 per cent in 2013 from 4.5 per cent in 2010, which however appears misleading when compared to facts in the ground.
BBS report said 45.6 million people are not included in formal estimate of the labour force; of them 36.1 million are female and 9.6 million are male.
Foreign employees on the rise
On the other hand, Bangladesh is increasingly recruiting foreign nationals in the absence of adequate skilled manpower with technical know-how. The majority of the foreign workers are employed in the garment sector in top posts like production managers, merchandisers, senior sewing operators, cutting masters, designers and washing experts. They mainly come from India and Sri Lanka, followed by Pakistan, China, South Korea, Taiwan and the Philippines. In 2014 the number of foreign workers was more than two lakh as per some estimates. Some labour leaders however claim the number is as high as one million. Bangladesh Bank data suggest that foreign workers are taking nearly $5 billion in salaries and allowances; and for India, Bangladesh is the fifth largest source of expatriate remittance.
From 2009 to September 2015, 7,030 new work permits were issued, according to data from the Board of Investment (BoI), one of the government bodies that issue employment visas for foreign nationals. In 2014, the BoI issued 3,511 extensions, and in 2013 the number was 2,907. Other government bodies such as Bangladesh Export Processing Zone Authority (BEPZA) are also authorised to issue work permits.
Between January 1 and November 29, the Department of Immigration and Passport gave extension to employment visas for 7,822 foreign nationals. In 2014, it authorised extensions for 8,957 foreign workers, which is however a very small part of the larger foreign workforce engaged in Bangladesh.
Sabina Yeasmin, a director of the BoI said the number is increasing everyday as many foreigners are coming on different jobs. There are many foreign nationals living in the country without valid documents. Yeasmin said applications for renewals are more than those for fresh permits.
Mahmud Hasan Khan Babu, vice-president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said his organization has asked about 5,000 of its members in October last year to report on the number of foreign employees they have employed. So far, only 233 factories have replied. BGMEA is preparing the database about the number of foreign workers, including the undocumented ones, he said.
Regarding foreign workers, Syed Sultan Uddin Ahmed, assistant executive director of the Bangladesh Institute of Labour Studies, said it is a new kind of challenge for the country as many do not have valid documents to stay and also remain a security concern. He called for a thorough survey of foreigners living and working in Bangladesh.
Farm and Non-farm jobs
Some estimates suggest around 40 lakh new faces entered the job market between 2010 and 2013 and an equal number of people got jobs, since economic activities mainly in non-farm sectors accelerated during this period. At the end of 2013, according to BBS survey, the total labour force stood at 6.07 crore, up from 5.67 crore recorded three years earlier. Of them, 5.81 crore were gainfully employed in contrast to 5.41 crore in 2010.
It means 13.33 lakh people entered the market every year during the period under survey and an equal number of people got gainfully employed then. Subsequently, the number of absolutely jobless persons remained unchanged at 26 lakh in 2013, according to the survey.
Agriculture is still at the top with 47 per cent employment generation rate followed by survey service sector which provides 37 per cent jobs. Industrial and manufacturing sectors are continuing to provide lesser jobs at 14 per cent.
Bangladesh is clearly lagging behind in terms of industrial and manufacturing sector employment. Bangladesh’s manufacturing sectors like garment, telecom, pharmaceuticals, shipbuilding and so on, are experiencing robust growth. Some new service sector openings are coming up with huge potentials: hospitality and tourism, cultural industry including performing arts, creative writing etc.
In the view of Towfikul Islam Khan, Bangladesh has a work force of about 85 million, 42 per cent of which are young people. Creating employment opportunities for such a large number of work force is a daunting task which needs a clear national strategy with a time line to achieve the objectives. Universities have the primary onus of educating their students properly, keeping in mind commensurate career opportunities, so that they can find good job and use their potentials. Universities should invest in capacity building for students, industries should develop them further. It will ultimately pay benefit to the overall industrial sector, he maintained.
Employment and under employment
Demand criteria for jobs cannot be fulfilled by less qualified applicants, yet. According to Rushidan Islam Rahman, research director of Bangladesh Institute of Development Studies (BIDS), mostly school dropouts remained unemployed and the country needs various skilled development programme that can be useful to utilise these young people who left schools to become a burden on their families and on society. Public-private partnership programmes for skill development and collaboration by prospective employers for low-paid workers will promote skills and generate their demand. They may become more skilled by learning as they work, she said.
 A large number of young people, who are graduates, are suffering from unemployment and underemployment problem. They have to opt for jobs that are not suitable for them, and there is little scope of fulfilling their potential. It is a big problem according to Kumar Murshid, Director-CSO, BRAC University. But there is very little research on real employment and under-employment situation amongst better educated young people.
The country has huge unemployed people, particularly young people, and yet industries are running 10 to 15 per cent vacant positions because they do not have the right people to hire. In the near future, the problem will be acute. That is why we are trying to team up with universities and industries to bridge the gap, Humaira Sharmeen, Head of Operations, Prothom-alojobs said. She held the view that the country’s universities should encourage students to participate in different forums organized by the universities and they must talk about their problem. Students need to develop their soft skills. Soft skills are crucial to be successful in professional life.
Source: Weekly Holiday

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