Jobless growth haunts economy

Bangladesh is witnessing steady growth without creating new employment opportunities—this state of jobless growth is a new economic phenomenon, experts have said.  

According to the labour force survey by the Bangladesh Bureau of Statistics (BBS), the country's gross domestic product (GDP) grew annually by 6.6 per cent in the last five years. As many as 28 lakh new jobs were created during that time, besides the 60 lakh jobs that already existed in 2013.

The number of jobs grew only by 0.9 per cent during that period.  

When asked about the reasons behind the phenomenon of jobless growth, Mustafizur Rahman, executive director of the Centre for Policy Dialogue (CPD), said the most alarming feature of this period has been the palpable decline in the number of manufacturing jobs.

The number of such jobs decreased by 0.77 million—from 9.53 million in 2013 to 8.76 million in 2016-17. The annual average decline is recorded at 1.6 per cent, despite a strong output growth of 10.4 per cent.

"The manufacturing sector, especially the apparel sector, has brought automation and replaced workers. This has increased the unemployment rate. Apparel producers use machines that are productive and put workers at high risk," he explained.  

He also said that there has been low-income employment growth. In between 2015-16 and 2016-17, around 1.3 million additional jobs were created, but the real income has declined, he added. “We should increase the creation of more decent work. We must also create more opportunities quickly for productive work that offers a fair income," he added.              

There has been an increase in the unemployment rate among the educated labour force, and this has to be reduced by diversifying the job creation in different sectors, he suggested.           

He said the service, manufacturing and agriculture sectors should contribute 56 per cent, 17 per cent and 27 per cent, respectively, to the GDP.        

 When asked why the economy is witnessing jobless growth, Dr Selim Raihan, executive director of the South Asian Network on Economic Modelling (SANEM), gave three reasons: replacement of human labour by automation in manufacturing, lack of diversification in the private sector and more than 85 per cent jobs being in the informal sector.          

He pointed out that automation in manufacturing has transformed factory floors, the nature of manufacturing employment and the economics of many manufacturing industries.

Citing an example, Raihan said that companies embracing automation have ruthlessly cut down the number of their employees. A single machine can easily do the work of 40 to 50 labourers these days, he noted.

He also said 85 per cent of new jobs were in the informal sector in 2016-17. Informal jobs increased from 41.2 million in 2013 to 44 million in 2016-17.       

The service sector contributes majorly to the GDP, but service sector jobs grew by around 4 per cent against the output growth of around 6 per cent during that time, he added.

Raihan also said that diversification in private sector is not taking place in the most ideal way. "We're not investing in areas like agro-processing, leather, footwear, plastic and other labour-intensive sectors. That’s why the employment growth is sluggish," he added.         

EA

 

Jobless growth haunts economy

Bangladesh is witnessing steady growth without creating new employment opportunitiesthis state of jobless growth is a new economic phenomenon, experts have said. According to the labour force survey by the Bangladesh Bureau of Statistics (BBS), the countrys gross domestic product (GDP) grew annually by 6.6 per cent in the last five years. As many as 28 lakh new jobs were created during that time, besides the 60 lakh jobs that already existed in 2013. The number of jobs grew only by 0.9 per cent during that period. When asked about the reasons behind the phenomenon of jobless growth, Mustafizur Rahman, executive director of the Centre for Policy Dialogue (CPD), said the most alarming feature of this period has been the palpable decline in the number of manufacturing jobs. The number of such jobs decreased by 0.77 millionfrom 9.53 million in 2013 to 8.76 million in 2016-17. The annual average decline is recorded at 1.6 per cent, despite a strong output growth of 10.4 per cent. The manufacturing sector, especially the apparel sector, has brought automation and replaced workers. This has increased the unemployment rate. Apparel producers use machines that are productive and put workers at high risk, he explained. He also said that there has been low-income employment growth. In between 2015-16 and 2016-17, around 1.3 million additional jobs were created, but the real income has declined, he added. We should increase the creation of more decent work. We must also create more opportunities quickly for productive work that offers a fair income, he added. There has been an increase in the unemployment rate among the educated labour force, and this has to be reduced by diversifying the job creation in different sectors, he suggested. He said the service, manufacturing and agriculture sectors should contribute 56 per cent, 17 per cent and 27 per cent, respectively, to the GDP. When asked why the economy is witnessing jobless growth, Dr Selim Raihan, executive director of the South Asian Network on Economic Modelling (SANEM), gave three reasons: replacement of human labour by automation in manufacturing, lack of diversification in the private sector and more than 85 per cent jobs being in the informal sector. He pointed out that automation in manufacturing has transformed factory floors, the nature of manufacturing employment and the economics of many manufacturing industries. Citing an example, Raihan said that companies embracing automation have ruthlessly cut down the number of their employees. A single machine can easily do the work of 40 to 50 labourers these days, he noted. He also said 85 per cent of new jobs were in the informal sector in 2016-17. Informal jobs increased from 41.2 million in 2013 to 44 million in 2016-17. The service sector contributes majorly to the GDP, but service sector jobs grew by around 4 per cent against the output growth of around 6 per cent during that time, he added. Raihan also said that diversification in private sector is not taking place in the most ideal way. Were not investing in areas like agro-processing, leather, footwear, plastic and other labour-intensive sectors. Thats why the employment growth is sluggish, he added. EA