Ominous shadow of joblessness, poverty

That all is not well with the state of Bangladesh's economy is corroborated by several recently published local and international studies. Even though the government managed to stabilise the economy to a large extent from the mess it inherited, prolonged political uncertainty appears to be a major drag on regaining economic growth momentum. Rising poverty rate, investment slowdowns, growing unemployment and persistent inflationary pressure are some of the red lights blinking on the country's economic dashboard. Consequently, the low and middle-income segments of the population are struggling to meet their living expenses. This unsavoury economic reality once again came under scrutiny at the recently held International Conference on Economics, Business and Technology Management (ICEBTM 2025).

Speakers at the event underscored that Bangladesh's unemployment rate rose to 5.08 per cent in 2025 from 3.66 per cent the previous year, marking the highest level in three years. Youth unemployment remains alarmingly high at 11.46 per cent. Such figures carry grave implications, as joblessness is pushing more families below the poverty line. Furthermore, according to a study by the Power and Participation Research Centre (PPRC), the poverty rate in Bangladesh has increased sharply, rising to an estimated 27.93 per cent in 2025 from 18.7 per cent in 2022. Another study warns that by December this year, around 16 million people in the country may face severe food insecurity, while approximately 1.6 million children are likely to suffer from acute malnutrition. These facts and figures are not mere figures; every number tells a story of gruelling hardship endured by unemployed youths and poverty-stricken families.

The unemployment and poverty situation is closely tied to the overall economic regime of a country. The closure of several hundred factories-triggered by labour unrest, gas shortages, abrupt hikes in bank loan interest rates and political turbulence since the student mass uprising of August 5, 2024 has undeniably worsened the situation. Although the interim government has taken various steps to remove investment hurdles, most local and foreign investors remain in a wait-and-see mood due to lingering political uncertainty, deteriorating law and order and an alarming rise in extortion from businesses. Even on Saturday last, reports emerged of a businessman being threatened with a painful death by rent-seekers if demand for extortion was not met. In such an atmosphere of fear and intimidation, no enterprise can thrive and no one can feel secure.

The country is also grappling with a dilemma over money supply. To rein in the galloping inflation, the central bank has been pursuing a tight monetary policy over the last three years, pushing up lending rates and raising the cost of borrowing, which is choking private investment. The prevailing liquidity crisis in some banks is further straining industrial sectors. Garment exporters, for instance, often allege that despite having sufficient deposits - including export proceeds - they cannot access funds due to the liquidity crunch in banks originating from massive surge in non-performing loans. Therefore, to restore economic growth momentum, the government must stabilise the banking sector, lower credit costs and rebuild investor confidence by addressing their legitimate concerns. Without a significant acceleration in private investment, unemployment will remain high and the goal of reducing poverty will remain out of reach.