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    Macro Assignment 1

    Uploaded by

    Khondaker Nowshin Nawar
    This document is a student assignment submitted to Associate Professor Fahmida Sultana at the University of Dhaka on unemployment in Bangladesh. The assignment was written by Khondaker Nowshin Nawar and examines unemployment rates and trends in Bangladesh from 1991 to 2019. It discusses how unemployment impacts Bangladesh's economic and social stability. Key points include that unemployment has increased with urbanization and population growth, was impacted by global recessions, and affects different groups such as youth and women disproportionately. The assignment concludes by recommending policy solutions like education, gender equality, and sustainable economic growth to address unemployment.

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    Macro Assignment 1

    Uploaded by

    Khondaker Nowshin Nawar
    8 views10 pages
    This document is a student assignment submitted to Associate Professor Fahmida Sultana at the University of Dhaka on unemployment in Bangladesh. The assignment was written by Khondaker Nowshin Nawar and examines unemployment rates and trends in Bangladesh from 1991 to 2019. It discusses how unemployment impacts Bangladesh's economic and social stability. Key points include that unemployment has increased with urbanization and population growth, was impacted by global recessions, and affects different groups such as youth and women disproportionately. The assignment concludes by recommending policy solutions like education, gender equality, and sustainable economic growth to address unemployment.

    Original Description:

    Assignment on Unemployment In Bangladesh for Macroeconomics

    Original Title

    Macro-Assignment-1

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    This document is a student assignment submitted to Associate Professor Fahmida Sultana at the University of Dhaka on unemployment in Bangladesh. The assignment was written by Khondaker Nowshin Nawar and examines unemployment rates and trends in Bangladesh from 1991 to 2019. It discusses how unemployment impacts Bangladesh's economic and social stability. Key points include that unemployment has increased with urbanization and population growth, was impacted by global recessions, and affects different groups such as youth and women disproportionately. The assignment concludes by recommending policy solutions like education, gender equality, and sustainable economic growth to address unemployment.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    8 views10 pages

    Macro Assignment 1

    Uploaded by

    Khondaker Nowshin Nawar
    This document is a student assignment submitted to Associate Professor Fahmida Sultana at the University of Dhaka on unemployment in Bangladesh. The assignment was written by Khondaker Nowshin Nawar and examines unemployment rates and trends in Bangladesh from 1991 to 2019. It discusses how unemployment impacts Bangladesh's economic and social stability. Key points include that unemployment has increased with urbanization and population growth, was impacted by global recessions, and affects different groups such as youth and women disproportionately. The assignment concludes by recommending policy solutions like education, gender equality, and sustainable economic growth to address unemployment.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 10

    University of Dhaka

    Assignment on:

    Unemployment in Bangladesh: A Bane to Economic and Social Stability

    Course: DS-107 Macroeconomics

    Submitted to:
    Fahmida Sultana
    Associate Professor
    Department of Developement Studies
    University of Dhaka

    Submitted by:
    Khondaker Nowshin Nawar
    SN-025, Batch-15
    Department of Development Studies
    University of Dhaka

    Date of Submission: 02/05/2023


    Unemployment in Bangladesh: A Bane to
    Economic and Social Stability
    Unemployment, one of the most pressing issues of the world, has far-reaching consequences that
    transverse through the layers of society. Bangladesh, a developing country in South Asia, has
    been struggling with high unemployment rates for decades, which has been a hindrance in its
    economic and social development. The issue of unemployment in Bangladesh is multi and inter
    dimensional, with a myriad of underlying factors, ranging from a lack of education and skills to
    inadequate job market, and an incremental population problem.

    Introduction:
    The term unemployment is applicable for those who are not working but are actively looking for
    a job. In every economy, the rate of unemployment fluctuates around the natural rate of
    unemployment. This is a rate created by default as there are not enough jobs for everyone and
    not everyone is skilled enough for that particular work in this competitive labor market. This
    competition for job opportunities in addition to a large population creates the natural rate of
    unemployment for Bangladesh.

    Unemployment Throughout the Years in Bangladesh:


    Bangladesh is a developing country with a mixed economy thus it has always maintained an
    unemployment rate below the global average. As an economy mostly reliant on its primary
    sector of production (RMG, jute, shrimps, leather, tea, etc.) it is expected to have low
    unemployment rates.
    The unemployment data since 1991-2019 shows:

    From 1991-2003 we can see a steady increase in unemployment. This is par for the course as
    with every developing economy a certain amount of unemployment is expected due to
    urbanization, in search of higher paying jobs and other socio-economic factors. Agriculture was
    the most employed sector in Bangladesh and due to technological advancements and logistical
    improvements our agricultural sector has experienced a decrease in employment, the same goes
    for most other primary sectors of production.
    From 2004-2006 we can see a steady unemployment rate which took a dip during 2005-2006 this
    can be attributed to a boom in the RMG sector as well as our leather industry. 2008-2009 was the
    period where the global financial crisis in 2008 affected the economy of Bangladesh as a whole.
    This resulted in a loss of jobs mostly as the primary industry as global demand for our exports
    decreased mainly our jute exports as that was one our main exports at the time. This caused a lot
    of factories to be shut down and thus lead to a lot of jobs lost.
    Our RMG sector also took a hit as a lot of garment factories shut down as well due to lack of
    orders. There was a discernible decrease in unemployment during 2010, this can be attributed to
    a large sum of foreign aid along with multiple policies which were implemented by the
    government. There was also a significant increase in the service sector during that year as the
    highest growth rate was observed for sales workers (42.57%) followed by administrative and
    managerial occupation (36.83%). The years following shows a steady increase in the
    unemployment rate which can be also attributed to urbanization also after the 2010’s Bangladesh
    faced a trend of decreasing employment elasticity. Between fiscal 2005-06 and 2009-10, the
    country’s employment elasticity was 0.55. It plunged to 0.25 between fiscal 2010-11 and 2017-
    18, when the economy averaged 6.6% GDP growth.

    Unemployment due to unsustainable growth


    Dhaka is the central hub for most of the job opportunities. Every year thousands of workers leave
    for Dhaka with the prospect of finding work. Dhaka generates 70% of the country’s money
    supply and holds 60% of FDI generated. This makes Dhaka a lucrative city in order to find a job.
    However, with an influx of labor supply already existing in the labor market, this creates a
    problem as many find themselves without work and so a large population return.

    Increase in the labor force:


    A reason why the unemployment rate increases is the unprecedented supply of labor. In late 2017
    due to the Rohingya crisis, about 700000 refugees took shelter in Bangladesh. By 2019. This has
    increased to 1.1 million by 2019. The big issue is that they have completely captured the labor
    market of Bangladesh even though they are barred from participating. The areas around Cox’s
    bazar saw a rise in the employment of Rohingyas, which may have possibly spread to the
    neighboring areas. This resulted in an inconsistent change in the minimum wage to cover for this
    increased supply of labor.

    Unemployment due to sectoral shifts:


    As Bangladesh progresses towards a modern era, it is shifting towards automation. The country
    is already doing well in the IT, industry, RMG and service sectors. It plans to increase its focus
    on these sectors with the FDI they receive from countries such as Japan and America. However,
    the underlying problem is that Bangladesh is losing focus on the agricultural sector. In 2010, we
    saw that 47.31% employment was in the agricultural sector, which was a source of income for
    the rural areas. However, by 2020 this will decrease to 37.75% and may decrease further due to
    the pandemic. Compared to the agricultural sector, the industry and service will see an increase
    in employment by 2020. The figures for the industry sector see a transition from 35.07% to
    40.61% by 2020. For the service sector, there is a transition from 17.63% to 21.65% by 2020.
    This private promotion is proving to be a curse to Bangladesh in the sense that rural people who
    were already at a disadvantage are going to have to suffer further.
    Youth unemployment:

    Unemployment among the youth increased from 2018 to 2021. It was 12.55% in 2018 which
    increased to 12.69% in 2019. There was an overall increase in the unemployment rate in the
    youth population, which means that even though the country prides on a youth population with a
    very bright future, there is very little done in order to make sure the youth generation have access
    to jobs.
    Female Unemployment
    Greater labor force participation of women can be a source of inclusive growth, and wellbeing.
    Despite the advances in female education attainment and the expansion of the market economy.
    However female labor participation rates are still low in comparison to the rates of their male
    counterparts in the country.

    Figure: Female labor force participation rate

    Female integration in the economy is very crucial for economic growth and development
    especially in developing countries. In Bangladesh where women constitute half of the
    population, This half faces various challenges especially at the employment level. The rate of
    female labor force increased from 36.11% in 2017-18 to 36.31% in 2019-20 even though they
    only represent 32%of the labor force. Bangladesh women labor force participation rate is still
    very low in 2018-19 compared to a global average of 52%. However, in recent years we see a
    change in the trend as the rate has decreased for the year 2020 and 2021.
    Steps Taken by Bangladesh to Improve the Employment
    Situation
    To ensure the transition of Bangladesh to a middle-income economy establishing the rights of
    workers specially living wage, improving safe working conditions, ensuring occupational safety
    and health and establishing peace and stability for enhancing productivity and economic
    development. Besides, implementation of labor law and updating the changed scenario, national
    labor policy formulation and implementation, skilled manpower and employment generation,
    minimum wage fixing, eliminating child labor, creating a safe workplace. Moreover, the
    Ministry of Labor and Employment is leading in various indicators of sustainable development
    goals such as eliminating child labor, decent work environment, equal pay for same work etc.

    The measurements taken by Bangladesh:


    • Preparation/Revision of Acts and Rules
    • Maintaining Industrial Peace and Compliance in Labor Sector for Uninterrupted Production
    • Skill Development and Training
    • Eradication of Child Labor
    • Women Development and Training
    • Innovation and digital activities
    • Expansion of Labor Market
    • Control of Immigration Cost
    • Training and Skill Development
    • Modernization of Emigration Process
    • Encouraging Sending Remittance Through Proper Channel.
    Conclusion
    The journey of Bangladesh’s economy is now riding an uptrend, aided by political and
    macroeconomic stability, compared to what it had started out in the 1970s.Yet, the problem of
    unemployment is always lurking. To address this issue, it is important to invest in education and
    skill development, ensure gender equality, promote entrepreneurship, strengthen labor laws and
    create more job opportunities through sustainable economic growth. By taking these steps,
    Bangladesh can unlock its potential, create a more prosperous future, and provide a brighter
    outlook for its citizens.

    References
    The World Bank. (n.d). Labor force total Bangladesh. [online] Available from:
    https://data.worldbank.org/indicator/SL.TLF.TOTL.IN?end=2019&locations=BD&start=1990
    [Accessed 27th April 2023].

    Statista.(2020). Bangladesh: Distribution of employment by economic sector from 2010 to


    2020. [online] Available from: https://www.statista.com/statistics/438360/employment-by-economic-
    sector-in-bangladesh/
    [Accessed 27th April 2023].

    Islam, J. and Uddin, J. (2019). Foreign employees taking a bite out of Bangladesh
    economy. [online] THE BUSINESS STANDARD. Available from: https://tbsnews.net/economy/foreign-
    employees-taking-bite-out-bangladesh-economy#:~:text=The%20 government%20has%20no%20
    reliable,the%20 Special%20 Branch%20 of%20 police.
    [Accessed 27th April 2023].

    Social Watch. (2012). Bangladesh: Centralisation in Dhaka blamed for unsustainable


    development. [online] Available from: https://www.socialwatch.org/node/14573
    [Accessed 27th April 2023].

    Macrotrends.(n.d). Bangladesh Youth Unemployment Rate. [online] Available from:


    https://www.macrotrends.net/countries/BGD/bangladesh/youth-unemployment-rate
    [Accessed 27th April 2023].

    Mujeri,M. (2019). Employment strategies for Bangladesh. [online] The Financial


    Express. Available from: https://www.thefinancialexpress.com.bd/views/employment-strategies-for-
    bangladesh-1552663154 [Accessed 27th April 2023].
    bdnews24.com.(2019). Barred from jobs, Rohingya refugees eat up Bangladesh labour market:Study.
    [online] Available from: https://bdnews24.com/bangladesh/2019/07/25/barred-from-jobs-rohingya-
    refugees-eat-up-bangladesh-labour-market-study [Accessed 27th April 2023].

    Forchielli,A. (2012). Bangladesh's unsustainable growth. [online] Available from:


    http://www.albertoforchielli.com/bangladeshs-unsustainable-growth/
    [Accessed 27th April 2023].

    Woahid,S. and Murad, M. (2009). The trends of labor market in Bangladesh and its
    determinants. [online] Munich Personal RePEc Archive. Available from: https://mpra.ub.uni-
    muenchen.de/32381/1/The_Trends_of_Labor_Market_in_Bangladesh_and_Its_determinants.pdf[Accesse
    d 27th April 2023].

    Bureau Of International Labor Affairs. (n.d). Child Labor and Forced Labor Reports.
    [online] Available from: https://www.dol.gov/agencies/ilab/resources/reports/child-labor/bangladesh
    [Accessed 27th April 2023].

    Hasnat, M.A. (2018). Is the job market in Saudi


    Arabia sinking for Bangladesh? [online] Dhaka Tribune. Available from:
    https://www.dhakatribune.com/bangladesh/nation/2018/10/18/is-the-job-market-in-saudi-arabia-
    shrinking-for-bangladesh [Accessed 27th April 2023].

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