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Can a budget to retrain workers cut down unemployment?

  • Published at 04:34 pm June 5th, 2018
  • Last updated at 04:38 pm June 5th, 2018
Photo: Syed Zakir Hossain

The non-government unemployment estimate is nearly seven times as much as the government estimate

The unemployment rate in Bangladesh has been lower compared to the previous decade, but it is also persistent. Economists and experts believe allocating a sizable portion of the upcoming budget can increase employment and expedite economic growth.

According to the International Labor Organization (ILO), the unemployment rate was 4.4% in 2017 – around 2.9 million people. But the number has been challenged.

Bangladesh Economic Association General Secretary Jamaluddin Ahmed said: “The government estimates there are 2.6 million unemployed. But we have found that the number is 17.5 million unemployed countrywide.”

He said introducing changes to education and training, in particular sanctioned by the government, would be imperative to develop a young and eligible workforce.

The economist also suggested forming a national employment planning and implementation program for the upcoming fiscal year.

According to the latest labour force survey by the Centre for Policy Dialogue (CPD), around 1.3 million additional jobs were created between 2015 and 2017.

The think-tank’s budget recommendation stated: “To date, we ran after higher GDP – which is important – but the more important thing is decent employment. The employment generated in the last two fiscal years was in the informal sector, where workplace status and labour rights are of poor quality.”

Towfiqul Islam Khan, a research fellow at CPD, said: “More than 1/3 of the total youth labor force [34.3%] with tertiary education remained unemployed during the 2016-17 fiscal year.”

He urged the government to refocus development objectives from the existing “GDP growth acceleration”-centric strategy to a “high economic growth from decent employment”-centric strategy to reduce low income employment.

A pre-budget nationwide survey conducted by BRAC and the Institute of Informatics and Development (IID) on 3,846 randomly selected participants, revealed that people believe generating new jobs is going to be the major challenge in the upcoming budget.

CPD Research Director Khondaker Golam Moazzem told the Dhaka Tribune: “Creating new jobs will be a big challenge. The government should have sufficient allocation for skill development in the upcoming budget. Otherwise, spending on infrastructure would do little good. The government should ensure industry-oriented training to make the labour force more suitable for the job market”

Generally skilled workers and semi skilled workers are in short supply in every sector. A 2016 survey of the Bangladesh Institute of Development Studies (BIDS) stated that existing skill gap is the highest in the agro-food sector followed by the RMG Sector.

Abdus Salam Murshedy, former president of the Bangladesh Garment Manufacturers and Exporters Association, told the Dhaka Tribune: “There are fresh graduates, but they lack skill and training, which is what manufacturers need. So, there is an acute shortage of skilled manpower.”

He too concurred that budgetary allocation to develop a skilled workforce is a must.

Finance Minister AMA Muhith, in his last budget speech for 2017-18, said: “Slow adaptation to changing technology and production techniques often creates unemployment. In this regard, we will impart necessary training to workers to improve their skills.” 

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