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Bangladesh Employment Growth Challenges

Bangladesh has experienced strong economic growth over the past decade, but has struggled to generate jobs fairly. A government study found that employment elasticity, which measures a country's ability to create jobs relative to GDP growth, declined in most sectors between 2009-2010 and 2017-2018. Specifically, employment elasticity dropped sharply in agriculture and construction, fell slightly in industry, and only increased modestly in services. The decline is attributed to the economy shifting from agriculture to industry and the increasing capital intensity of industrial production. Overall employment elasticity declined because the decreases in agriculture and industry outweighed the increase in services.

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50 views3 pages

Bangladesh Employment Growth Challenges

Bangladesh has experienced strong economic growth over the past decade, but has struggled to generate jobs fairly. A government study found that employment elasticity, which measures a country's ability to create jobs relative to GDP growth, declined in most sectors between 2009-2010 and 2017-2018. Specifically, employment elasticity dropped sharply in agriculture and construction, fell slightly in industry, and only increased modestly in services. The decline is attributed to the economy shifting from agriculture to industry and the increasing capital intensity of industrial production. Overall employment elasticity declined because the decreases in agriculture and industry outweighed the increase in services.

Uploaded by

shahriar pritom
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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“From the article we see” Bangladesh’s tremendous economic growth has been unable to create jobs

fairly, over the past decade.

Female participation in the labour force shortened in the last nine years, especially in rural areas, according
to a government study on employment

“We know” Employment elasticity is a study which indicates the ability of an economy to generate
employment opportunities for its population as percent of its growth process

“For Example we see”: employment elasticity of 0.01 implies that with every 1% point
growth in GDP, employment increased by just one basis point

In Agriculture, manufacturing, construction and services sector, the employment elasticity is lower than
1%, indicating that employment generation is not very sensitive to growth. This study conducted by the
General Economics Division under the planning ministry

“So” The major objective of the study, was to gain vision of economic growth, employment generation,
productivity and investment

1. The services sector is the only sector that saw an increase in employment elasticity:
From 0.27 to 0.40 in fiscal 2009-10 to 2017-18
2. In agriculture it dropped to (-0.09) from 0.71 in within few years
3. In construction sector it dropped from 2.22 to 0.55 within 2009-10 to 2017-18

“Here” the study attributed the decline to two real-time phenomena

1. the structural transformation in the economy from agriculture to industrial sector


2. Industrial sector being more capital intensive.

Both are becoming more capital intensive rather than labour intensive

“So the” “Overall employment elasticity declined because the decrease in employment elasticity in
agriculture and industry far outweighed the increase in employment elasticity in services.”

Said by Zahid Hussain, former lead economist at the World Bank’s


“We see that” Employment elasticity in agriculture dropped rapidly because of growing mechanization
and agricultural production processes

 Employment in agriculture declined from 26.2 million to 25 million in 2010 to


2018
 “While” employment in services increased from 19.8 million to 23.8 million
individually
 “And” Employment in industry increased from 12.1 million to 13.1 million in
2010 to 2018

Despite of rising growth in industrial output, growth of labour demand in industry was weak

Because of low investment growth and higher capital intensity of

 industrial production processes and


 the spread of automation

“we also notices that” In the recent years, industrial growth came more from

 manufacturing and
 construction sectors

“Which is from” domestic market-oriented, not from the labour intensive export-oriented sectors

According to Zahid, a big setback in the growth process has been the loss of female participation in
employment.

 The number of unemployed females increased


To 1.2 million from 1 million within 2010 to 2018
 In rural areas, 12.6 million females were employed in 2010
but The number fell to 11.6 million in 2018

“The study suggested on” “Opportunities need to be opened up and the barriers to female labour
force participation need to be eliminated.”

“So” Infrastructure such as

 childcare facilities at workplaces


 increase in access to education and training
 availability of maternity leave
 Better implementation of laws
 ensure better wages and
 also the status of women at the workplace

“These things can involve a large number of women at workplace”, which will improve
employment elasticity and help the sectors overcome the financing and unskilled labour problems.

“However”, since further advancement of technology will require high-skilled labour.

So Focusing on demand driven skill development system should be the priority for Bangladesh,”

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