Addressing unemployment
Enayet Rasul | Thursday, 14 August 2008
WHY unemployment is bad for any economy is obvious. The unemployed ones are not productive, they do not add to the net of goods and services. They are rather dependants consuming what others produce, say, in the family, community or the country. Thus, they are liabilities for the national economy as a whole.
Bangladesh with its vast population of 150 million people could be considered as having a large enough workforce to significantly boost its gross domestic product (GDP) by applying the strength of this workforce. But this prospect remains not realised from having a huge backlog of unemployed people and addition to their number every year. Unemployment, according to a recent report published in the FE, is turning more and more into a very serious issue. Thus, annually some 2.7 million young people are reportedly becoming eligible for jobs in this country. But only about 0.7 million of them are getting any form of employment. The number of the unemployed in the population is estimated at 30 million. But at the current rate of increase in unemployment, projections are that the number of the unemployed would rise to 60 million by 2015.
Thus, it hardly needs explanation why unemployment needs to be among the highest priorities of every government from now. It should be particularly noted that the relationship between unemployment and lack of investment operations, is an umbilical one. Only a high rate of economic growth caused by a similar rate of new investments in the economy, can be the only assurance that jobs in good number will continue to be created to employ the existing unemployed persons and absorb the new workers becoming eligible for jobs. But this basic requirement of investment to create employment has not been met in Bangladesh in the last several years.
Investment operations in this country suffered from political turmoil before the incumbent government took over. But the investments dipped alarmingly low since its takeover from a host of factors particularly from the fear psychosis that gripped businessmen from governmental policies. The tenure of the present government is about to end only months from now. The lookout of all important stakeholders in the economy should be maintaining political stability beyond the coming national elections and continuity of business friendly policies by the coming government. This would be the minimum need to pull up the sagging investment activities. This would, in turn, help expand the opportunities for domestic employment.
Simultaneously, all-out efforts will have to be made to improve the energy supply situation which is presently discouraging new investments or restricting production activities with the same resulting in shrinking opportunities for jobs. The next government will need to overcome the problem of insufficient energy supply and maintain other incentives both to induce the potential local and foreign investors to go ahead with their investment plans.
Furthermore, the government should engage in a comprehensive exercise to reform the manpower sector so that the going out of more and more people with foreign employment can be sustained. The banks can take up programmes to provide intending overseas workers with loans for paying to manpower agents and these loans can be serviced on reaching their places of employment. The underhand exorbitant fees taken by manpower agents will need to be similarly regulated. The Bangladeshi missions abroad will need to be revamped to discharge much better service for our workers in all respects. Skill training for young persons under government-run programmes will have to be much expanded throughout the country. The same will help expand self-employment opportunities in the country. This will also feed the needs of local entrepreneurs while also helping more skilled workers to go abroad with higher wages.
Bangladesh with its vast population of 150 million people could be considered as having a large enough workforce to significantly boost its gross domestic product (GDP) by applying the strength of this workforce. But this prospect remains not realised from having a huge backlog of unemployed people and addition to their number every year. Unemployment, according to a recent report published in the FE, is turning more and more into a very serious issue. Thus, annually some 2.7 million young people are reportedly becoming eligible for jobs in this country. But only about 0.7 million of them are getting any form of employment. The number of the unemployed in the population is estimated at 30 million. But at the current rate of increase in unemployment, projections are that the number of the unemployed would rise to 60 million by 2015.
Thus, it hardly needs explanation why unemployment needs to be among the highest priorities of every government from now. It should be particularly noted that the relationship between unemployment and lack of investment operations, is an umbilical one. Only a high rate of economic growth caused by a similar rate of new investments in the economy, can be the only assurance that jobs in good number will continue to be created to employ the existing unemployed persons and absorb the new workers becoming eligible for jobs. But this basic requirement of investment to create employment has not been met in Bangladesh in the last several years.
Investment operations in this country suffered from political turmoil before the incumbent government took over. But the investments dipped alarmingly low since its takeover from a host of factors particularly from the fear psychosis that gripped businessmen from governmental policies. The tenure of the present government is about to end only months from now. The lookout of all important stakeholders in the economy should be maintaining political stability beyond the coming national elections and continuity of business friendly policies by the coming government. This would be the minimum need to pull up the sagging investment activities. This would, in turn, help expand the opportunities for domestic employment.
Simultaneously, all-out efforts will have to be made to improve the energy supply situation which is presently discouraging new investments or restricting production activities with the same resulting in shrinking opportunities for jobs. The next government will need to overcome the problem of insufficient energy supply and maintain other incentives both to induce the potential local and foreign investors to go ahead with their investment plans.
Furthermore, the government should engage in a comprehensive exercise to reform the manpower sector so that the going out of more and more people with foreign employment can be sustained. The banks can take up programmes to provide intending overseas workers with loans for paying to manpower agents and these loans can be serviced on reaching their places of employment. The underhand exorbitant fees taken by manpower agents will need to be similarly regulated. The Bangladeshi missions abroad will need to be revamped to discharge much better service for our workers in all respects. Skill training for young persons under government-run programmes will have to be much expanded throughout the country. The same will help expand self-employment opportunities in the country. This will also feed the needs of local entrepreneurs while also helping more skilled workers to go abroad with higher wages.