Perplexing and frustrating
Wednesday, 22 August 2007
THE reported finding of a recent study by the Bangladesh Institute of Development Studies (BIDS) on the unemployment situation during 2000-05 when, according to earlier official figures, the economy witnessed otherwise a comfortable growth performance, makes things unclear. One needs here to clarify or explain whether the earlier reported growth figures were factual or such growth did have little opportunities for new job creation. The BIDS study has, thus, found that overall employment rate in the country fell by 4.4 per cent during the said period when the economy recorded an annual average growth of about 6.0 per cent -- the highest was 6.8 per cent in 2000-05. The worsening unemployment situation, as has been pointed out at a recently-held seminar in the capital city, is due to a substantial decline in total employment in the non-farm enterprises. Superficially, it should mean that such enterprises have shrunk or recorded very low growth compared to manpower supply during the particular time.
If the official growth figures are to be accepted as factual, then the period concerned would be considered the best period of the country so far. The highest ever growth rate, in terms of volume, was attained during it. What then did happen to decelerate the employment rate? The period witnessed privatisation, closure of some loss-making state-owned enterprises and good industrial expansion, led by the private sector. The economy expanded with the significant growth of the private sector. The fact of the decline of the employment rate thus seems to suggest that the private sector non-farm enterprises either opted for superior technology relying less on manpower, or it engaged only essential workforce in their industries, unlike the public sector where excess employment, under political and trade union pressure and managerial ill practices, was usually the rule, rather than any astray deviation.
Another finding of the BIDS, based on analysis of data collected by the Bangladesh Bureau of statistics (BBS) for its household income and expenditure survey, is very alarming. The finding is that the income growth rate of the lowest 50 per cent households of the country was outpaced during that period by the consumer price index. In terms of quality of life, it can simply mean that half of the nation has been further impoverished. How does this finding match with the previously claimed position that the number of people below the poverty line has progressively reduced in the recent years? Obviously, this finding is both distressful as well as bewildering. The BIDS may like to examine the authenticity of the BBS data through a sparsely conducted random survey. If the finding of such a survey endorses the one based on the BBS data, the government will have to go for reinforcing the assault on poverty with redoubled efforts and programmes.
Declining employment rate, in a situation of reduced purchasing power among the lowest 50 per cent households, is unpropitious development for the country with its poverty reduction strategy now under implementation. Frustration, fuelled by privation among such a big segment of the population, can create an unmanageable difficult situation. The grim possibility cannot be overlooked for long. But the government alone will not succeed in changing the situation for the better. Neither the resources under its command nor the opportunities available to it under the free market economy will fully enable it to mount a massive crusade against poverty and unemployment, as required now. The private sector will have to take the lead to rapidly create employment opportunities and more national wealth through expansion of the industrial sector. The educational institutions -- public and private -- should greatly improve their academic standard to ensure that those taught by them and pass out do come out as really capable workforce. Good jobs will then be available to them at home and abroad. The fight against poverty has to be indeed multi-pronged and total.
If the official growth figures are to be accepted as factual, then the period concerned would be considered the best period of the country so far. The highest ever growth rate, in terms of volume, was attained during it. What then did happen to decelerate the employment rate? The period witnessed privatisation, closure of some loss-making state-owned enterprises and good industrial expansion, led by the private sector. The economy expanded with the significant growth of the private sector. The fact of the decline of the employment rate thus seems to suggest that the private sector non-farm enterprises either opted for superior technology relying less on manpower, or it engaged only essential workforce in their industries, unlike the public sector where excess employment, under political and trade union pressure and managerial ill practices, was usually the rule, rather than any astray deviation.
Another finding of the BIDS, based on analysis of data collected by the Bangladesh Bureau of statistics (BBS) for its household income and expenditure survey, is very alarming. The finding is that the income growth rate of the lowest 50 per cent households of the country was outpaced during that period by the consumer price index. In terms of quality of life, it can simply mean that half of the nation has been further impoverished. How does this finding match with the previously claimed position that the number of people below the poverty line has progressively reduced in the recent years? Obviously, this finding is both distressful as well as bewildering. The BIDS may like to examine the authenticity of the BBS data through a sparsely conducted random survey. If the finding of such a survey endorses the one based on the BBS data, the government will have to go for reinforcing the assault on poverty with redoubled efforts and programmes.
Declining employment rate, in a situation of reduced purchasing power among the lowest 50 per cent households, is unpropitious development for the country with its poverty reduction strategy now under implementation. Frustration, fuelled by privation among such a big segment of the population, can create an unmanageable difficult situation. The grim possibility cannot be overlooked for long. But the government alone will not succeed in changing the situation for the better. Neither the resources under its command nor the opportunities available to it under the free market economy will fully enable it to mount a massive crusade against poverty and unemployment, as required now. The private sector will have to take the lead to rapidly create employment opportunities and more national wealth through expansion of the industrial sector. The educational institutions -- public and private -- should greatly improve their academic standard to ensure that those taught by them and pass out do come out as really capable workforce. Good jobs will then be available to them at home and abroad. The fight against poverty has to be indeed multi-pronged and total.