Experts stress employment generation in export oriented industry

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FE Team | Published: March 09, 2014 00:00:00 | Updated: November 30, 2026 06:01:00

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FE Report
Bangladesh can create employments for its additional workforce in the export oriented industry and low- skilled income generating activities at this stage of development, experts told a workshop held in the city Saturday.
Although Bangladesh economy has grown over the last two decades, still the domestic economy is not big enough to absorb the growing labour force, nor the driver of good jobs. The overwhelmingly larger youth labour force should be employed in export oriented industries which is not limited to readymade garment industry alone, but other areas like export of intermediate and finished goods, they noted. Manpower export also will be a major area of consideration to provide with the huge number of workforce in the coming years, they added.
Their comments came at a workshop on "Changing Labour Markets in Bangladesh: Understanding Dynamics in Relation to Economic Growth and Poverty" at Brac Centre Inn.
South Asian Network on Economic Modelling (SANEM) organized the workshop in cooperation with the International Development Research Centre (IDRC), Canada. Member of General Economic Division (GED) under Planning Commission, Shamsul Alam chaired the workshop.
One of the distinguished panelists, Policy Research Institute chairman Zaidi Sattar said Bangladesh economy is much more export oriented and integrated with world economy over the last two decades. About 50 per cent of its economy has been integrated with the global goods market and not with the financial market. The trade and GDP ratio has risen from barely 19 per cent in 1990 to 50 per cent now.
"The only way good jobs and employment can be created for 1.8 million additional labour force every year is through the export orientation, output orientation including labour that we send abroad," said Mr Sattar, adding: Simply because the domestic economy is limited to create those additional jobs.
He said for the foreseeable future Bangladesh has the labour cost advantage in low skilled, semi-skilled and unskilled jobs and not in the knowledge-intensive jobs except for the few leapfrogging like ship building and electronic goods industries.
Research Director of Bangladesh Institute of Development Studies Binayak Sen said there are income generating and poverty reducing unsustainable jobs like rickshaw pulling or ship breaking. But emphasis should be on good jobs in the sense of employment generation and reduction.  
"I agree there is much room for growth for low wage, labour-intensive activities at this stage of development of Bangladesh when we are approaching middle income status. Human capital is not now a binding constraint for transiting to middle income status," said Mr Sen.
"Human capital is necessary only to escape the middle income trap," he added.
Citing an example, he said out of 101 middle-income countries in 1960s, only 13 countries could escape to high-income.
Regarding the present trend of income generation through an unsustainable livelihoods, he said it is proved that persisting in those jobs for a longer period reduces both income and employment. So there should be policy for early exit from those jobs.
World Bank senior economist Iffat Shariff said the labour wage in rural areas increased between 2005 and 2010. But the urban wage has not increased although there is sufficient demand for salaried workers.
She highlighted the significant rise in working age population between 2005-2010 which is 25 per cent and which is a result of mainly the demographic dividend Bangladesh now possesses. As many as 11 million workforce has joined the labour force in this period while another 10 million will be added by 2020, she added.
She emphasized the need for identifying the bottlenecks of domestic job creation and the stagnation of average real income of urban areas.