Unemployment and skills gap in Bangladesh: Rhetoric and reality

Bangladesh, a South Asian country, is expected to graduate from LDC by 2026. The country is one of the fastest growing economies in Asia with annual GDP growth of 5.8 per cent in comparison to the global growth which is 2.7 per cent as per World Bank statistics and sometimes is regarded as the Rising Star of Asia. Amidst such an economic boom, Bangladesh has a high unemployment rate. Unemployment persists due to structural reasons- that is when there is a mismatch of skills and requirements among other factors. To combat unemployment, the government has adopted various policies, action plans and programmes. Particularly, to take advantage of the ongoing demographic dividend, the government, NGOs and INGOs have taken a number of skills development programmes targeting youths. Despite such initiatives, the unemployment condition has not improved in the country and the rate shows increasing trends among educated youths.

Being one of the top-populous countries in the world, the country has a population of 172,954,319. According to the Labour Force Survey (LFS) released by the Bangladesh Bureau of Statistics (BBS), the working population is 73.75 million out of which the total number of youth labour force (ages 15-29 years) is estimated at 25.92 million. This demographic represents a significant potential for economic growth, but challenges remain in terms of employment opportunities and skill development. The unemployment rate highlights these challenges, the unemployment rate in Bangladesh stands at 5.1 per cent as per the latest World Bank data, and as per The BBS data, this number is 2.59 million.

To address these challenges, the government has implemented multiple initiatives, such as the National Social Security Strategy (NSSS), skill development training by Palli Karma-Sahayak Foundation (PKSF), Skills for Employment Investment Program (SEIP) financed by the ADB etc. These initiatives collectively aim to reduce poverty and unemployment by providing social protection, financial services and skill development of the working population.

However, the bleak picture so far necessitates refocusing on this issue by taking approaches from multiple dimensions. From this ground, some measures should be taken as the following:

ALLOCATING MORE BUDGET : As per the information on the website, PKSF-SEIP projects have a grand allotted budget of Tk 1.9216 billion. However, it can train only 38,600 individuals, this number is very insignificant. There are 2.5 million people without a job and this number is on the rise each year. Therefore, it is evident that the project's scope is quite small in relation to the vast need for employment opportunities.

To address this gap, it would be productive for the project to broaden its prospects by sourcing funds from private organisations or providing training by these organisations so that their need can be addressed properly. Some organisations would potentially contribute as donors, supporting the vital work of preparing individuals with the skills they need for the workforce.

Another solution to the funding challenge could be to seek funding set aside for capacity building under the "Strengthen workfare programmes and Training" section of NSSS. NSSS has an impressive budget of approximately Tk 1.87trillion for the implementation of their Phase-II Action Plan, which is 17 per cent more than the previous fiscal year. Considering the fact that the pension scheme was incorporated in NSSS, it would be feasible to direct some budget under the skill development wing. This reallocation would expand the project's reach and impact, providing more individuals with the training they need to secure meaningful employment.

LOCATION OF THE TRAINING: The location of the training provision plays a vital role as well. As per the Labor Force Survey 2022 (BBS), urban unemployment stands at 0.70, the rate is only decreasing over the years, whereas, in the rural, it stands at 1.81 which is an increasing trend. The unemployment in males seems to have increased in both rural and urban areas which has decreased in females in both areas. This can be due to the nature of the training/avenues provided in the rural areas.

PKSF or its partnered organisations such as BRAC, and Grameen Jano Unnayan Sangstha (GJUS), mostly tend to create unemployment in rural areas through the provision of microcredit or through providing entrepreneurship opportunities, especially targeting women. Hence men tend to be engaged in the informal economic sources of earning.

To fix these job gaps, it is important to set up more places in rural areas where individuals can learn technical skills. This kind of training can help people learn what they need to know to get good jobs.

LACK OF ACCESSIBILITY: The official pages of SEIP and PKSF do not have a user-friendly interface. Mostly, no clear information is available on how one can enroll themselves in the courses. The websites should have a separate section for registration and that should be kept up to date so that an individual sees the capacity of the batches. Also, the eligibility criteria should be clearly stated.

Physical forms should be available at different partner organisations' offices, and online portals should be opened for better application facilitation. The major problem with these plans is that there is less awareness regarding them, hence, it is important to broadcast the information on TV, Radio, Newspapers or billboards, etc, any media that is popular amongst the youth population.

Also, it could be productive to take some courses online. This could be especially beneficial to those living outside Dhaka, they could access training without physically moving to Dhaka since moving to a different location involves a lot of financial barriers starting from finding a place to stay in, and adapting to the urban culture could pose challenges to an individual. This will also significantly increase the enrollment rates of these courses.

MINIMISING THE GAP BETWEEN ACADEMIC/RESEARCH INSTITUTIONS AND INDUSTRY: For financial aid, these projects are heavily reliant on funding from Asian Development Bank (ADB) and the Swiss Agency for Development and Cooperation (SDC). It is problematic because once the funding is cut short, the agenda of these action plans might be hindered making the dependency on the donors very unreliable.

Currently, only five academic institutes-BRAC, BUTEX, East West University, BIGM, and IBA-University of Dhaka-are associated with PKSF-SEIP out of 171 tertiary education institutions. To address the potential funding crisis in the future, the programme should collaborate with more academic or research institutes, as well as industries.

This approach allows academia to provide theoretical knowledge, while industries gain skilled workers tailored to their needs. Additionally, it reduces heavy reliance on aid.

FINAL THOUGHTS: The effectiveness of these programmes in producing skilled professionals should be assessed. SEIP claims to have produced 727,855 certified individuals, of whom 513,025 are currently employed. There is no available information on the measures being taken for the 30 per cent who remain unemployed. The reasons for their unemployment must be identified, and appropriate steps should be taken to prevent this from recurring. Alternatively, the institutes could retrain these individuals.

Moreover, certificates should only be awarded after evaluating attendance and performance, rather than merely completing a three- or six-month training programme. Participants should be evaluated through assigned projects or tests. Based on the results, additional training should be provided to those with lower scores.

The effectiveness of the training is questionable, as it is open to individuals who are already employed. This may give experienced candidates an advantage over those with limited experience. To address this, candidates' levels of experience should be considered when allocating batches. This will make the training more effective, as all participants will start from a similar baseline.

The payment structure for trainers may be a significant factor behind the high number of certifications. Currently, trainers are paid based on enrolment, certification, and the retention of trainees in their jobs. This structure may incentivise trainers to prioritise completing the course over ensuring quality learning. To address this, trainers could be provided with a fixed monthly salary, which might attract more qualified professionals to join the programmes.

The role of academic institutes should be expanded. This would ensure that curricula are better aligned with job market needs and attract more donors to support the objectives of these projects.

The writers are respectively a Research Assistant and an Associate Professor in the Global Studies and Governance (GSG) department at Independent University.

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