Industry’s contribution to GDP up, employment down

Bangladesh’s industrial sector has failed to create proportional fresh employment during the last five years despite growth in its contribution to the gross domestic product (GDP), research findings show.
Employment in the sector fell by 3.4 per cent last year to 17 per cent which was 20.4 per cent in 2017 while its contribution to the country’s GDP went up to 36.9 per cent from 32.5 per cent during the period.
Employment has stagnated even in the higher-export-earning apparel sector, largely following automation and labour-saving technologies, as disclosed at a cutting-edge meet in Dhaka on Thursday where government and ILO representatives made their deliberations on such developments, among others.
In another reverse imbalance between growth and jobs, share of agriculture to the GDP fell to 11.6 per cent last year from 14.1 per cent in 2017 but employment share increased by 4.6-percentage points from 40.6 per cent in 2017 to 45.3 per cent in 2022.
On the other hand, urban employment also decreased, with the depression rate being higher for women as. Women employment decreased to 23.58 per cent from 31 per cent in 2017.
Dr MA Razzaque, chairman of Research and Policy Integration for Development (RAPID), shared the statistics at the technical dialogue jointly organized by the Ministry of Labour and Employment (MoLE) and the International Labour Organisation (ILO).
The dialogue on ‘National Employment Policy and Labour Market Employment Challenges in Bangladesh’ was organised to discuss the critical challenges arising from current labour-market trends in the country and to explore effective means of addressing those through the National Employment Policy (NEP) that was formulated last year.
“Employment in the Industrial sector fell absolutely by 0.35 million from 12.4 million to 12.05 million in 2022 while the average real GDP output of the industrial sector grew by more than 9.0 per cent per annum during the period,” Mr Razzaque said while presenting his keynote paper.
Citing example, he said the robust garment export is not reflected in the employment growth of the sector. Between 2008 and 2022, garment exports grew from $10 billion to about $43 billion but employment in the sector remained stagnant at around 3.5 million to 4 million.
“Automation and infusion of labour-saving technology is the reason for the stagnant employment in the manufacturing sector,” he told the meet, where the junior minister for the ministry and officials mentioned remedial measures.
Citing the provisional labour-force survey 2022, he said labour force had increased by 10 million between 2017 and 2022 while the number of unemployed gone down from 2.7 million to 2.6 million.
He emphasized mainly the appropriate implementation of the employment policy that needs to build the institutional capacity of the ministry of labour, focusing on the social protection of the workers in the informal economy, analyzing demand-supply gap of high-potential sectors for employment and counting underemployment as crucial as unemployment.
Meantime, the NEP aims to create 30 million additional jobs by 2030.
International labour markets are of critical significance as overseas opportunities are a major source of employment generation, the RAPID chairman said.
In this respect, he pointed out that less-skilled workers occupy the largest share of the country’s migrant workforce—with resultant lesser remittances the country receives.
Being one of the highest-remittance-recipient countries in the world, the earnings per migrant worker is considered too low for Bangladesh.
Speaking there, State Minister for Labour Begum Monnujan Sufian said her ministry together with other ministries and stakeholders would pursue evidence-based policy development and targeted interventions to create an enabling environment for decent employment opportunities aligned with the Employment Policy developed last year.
As part of its implementation the MoLE is also exploring the establishment of an Employment Directorate to coordinate the employment agenda, she noted.
Bangladesh country director of the ILO Tuomo said, “It is evident that jobs creation, social security, quality of employment and international trade are crucial to achieve the goals, but the National Employment Policy could be the pivotal tool to pushing employment agenda further in connection to achieve the country’s vision.”
He added: “Promoting the creation of full and productive employment has been an integral part of ILO’s work in Bangladesh. This is because decent jobs are not just any jobs but the basis for peace, social justice, social inclusion, economic development, and personal fulfillment.”
Dr Md Kawser Ahmed, Member (Secretary) of the General Economics Division (GED), said the government emphasized providing “industry-relevant skills training, promoting entrepreneurship, and creating job opportunities that can help to empower the two million new market entrants”.
He highlighted that addressing challenges in employment is one of the priority areas of government’s various plans.
“NEP implementation is the key to addressing labour-market challenges, promoting inclusion, and driving sustainable development. With targeted policies and interventions, we can effectively tackle unemployment, skills mismatch, and other pressing issues, ultimately improving livelihoods and fostering socioeconomic progress,” he noted.
Sharifa Khan, Secretary of the Economic Relations Division, stressed rearing skilled workers in the post-graduation time to maintain competitiveness.
She said, “LDC graduation brings forth labour market and employment consequences, highlighting the need for skilled workers and increased labour productivity to enhance competitiveness in exporting high-end products and services. This timely technical dialogue on the national employment policy aligns with the macroeconomic challenges of Bangladesh, providing valuable insights and solutions for the future.”
Dr. Shahnaz Arefin ndc, Secretary of the Statistics and Informatics Division, addressed the importance of labour-market intelligence and data in formulating and implementing employment policies.
“Labour-market intelligence and data play a crucial role in formulating and implementing effective employment policies. As Bangladesh strives to achieve SDGs by 2030 and graduate from LDC status by 2026, establishing a comprehensive labour market information system (LMIS) becomes imperative.
“This requires resource allocation, interagency coordination, private-sector engagement, and a robust monitoring system to support evidence-based decision-making and ensure the success of employment initiatives”.
Dr Sher Singh Verick, Chief of Employment, labour market and youth branch of the ILO, Dr. S.M. Zulfiqar Ali, Senior Research Fellow of Bangladesh Institute of Development Studies, Dr. Tasneem Arefa Siddiqui, Professor of Dhaka University, and Md. Ehsan-E-Elahi, Secretary of MoLE, also spoke at the event.

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