Tracking the employment situation

Published: March 27, 2017 20:09:52 | Updated: October 23, 2017 11:18:26

Whether the country's economic growth is generating required or sufficient employment is a matter of debate. Policy makers believe that 7-plus growth rate of the Gross Domestic Product (GDP) is successfully generating necessary employment. Economists and analysts are, however, sceptical about the extent of job creation. Lack of updated and comprehensive data on employment generation and unemployment reduction has intensified the doubt.
The latest official data on the country's employment situation are available up to 2013. The Labour Force Survey (LFS-2013) revealed that the country's total labour force stood at 60.7 million in 2013 of which 58.1 million were employed and only 2.59 million were unemployed. Thus, the rate of unemployment in the country estimated at 4.3 per cent. Bangladesh Bureau of Statistics (BBS) is yet to release the updated report of LFS.
If the national statistics office could calculate the national output statistics annually and smoothly, why isn't it putting some additional effort to conduct frequent labour force survey and release the result? True, labour force survey is long-drawn process and it requires the capacity to conduct comprehensive survey.
Even the available statistics indicates that employment generation is not sufficiently matched with the pace of GDP growth rate. In a recent seminar, organised by the Centre for Development and Employment Research (CDER), it was mentioned that during the 1990s and up to 2005, GDP growth of about 1.8 per cent was required to attain 1 per cent growth in employment. But during 2010-2013, some 2.6 GDP growth rate generated 1 per cent growth in employment. The analysis indicates lesser ability of the growth to create jobs.
There is also a move in recent time to conduct quarterly LFS and generate quarterly employment data. BBS, with the technical assistance of the World Bank (WB), initiated the project on July, 2015 which is scheduled to complete on June this year.
As part of the work, a quarterly job situation was prepared for July-September quarter of 2015. Though the report was not officially released, a leading newspaper last year ran a story on the findings. It showed that only 0.6 million people were employed during 2014-15. Thus the total number of employed people stood at 58.7 million in 2015 which was 58.1 million in 2013. On the other hand, number of the unemployed increased to 2.63 million, adding some 40,000 jobless people in two years. The rate of unemployment, however, was almost stagnant at 4.3 per cent. BBS considers those people unemployed who are not engaged in wage labour even for a single hour in a week.
The statistics, however, creates lot of confusion. Policy makers argue that annual employment of only 0.3 million people doesn't tally with the current growth rate. They also stressed on recheck and revision of the BBS data, to make it consistent with the growth figure.  
Against the backdrop, BBS is now working to estimate full one year data divided in four quarters. The statistical office is likely to release the complete statistics by the end of this fiscal year (June, 2017). But several official documents have already used the data of QLFS. For instance, General Economics Division of the Planning Commission released the final evaluation and stock-taking report on Millennium Development Goals (MDGs) on September last year. It mentioned that labour force participation rate (LFPR) stood at 58.7 per cent in 2015 on the basis of QLFS of July-September, 2015. The LFPR is the ratio of labour force (both the employed and unemployed people) as a percentage of working age population (aged 15 and above) at a certain period of time    
Now, LFPR of 58.7 per cent is above the rate of 57.1 per cent in 2013 but below the 59.3 per cent in 2010. It, thus, also indicates that GDP growth is not creating jobs substantially.  
In fact, the Sixth Five Year Plan (6FYP) initially projected to create 61.6 million jobs by 2015. At that time, due to absence of LFS 2010, the number of employment for the base-year or 2010 was estimated at 52.4 million.  Thus, the five-year period under the plan was set to create 9.2 million additional jobs.
As the BBS released LFS 2010 immediately after the formulation of the 6FYP, it showed that the number of employed people was 54.1 million in 2010. Accordingly, the Planning Commission revised the job creation target and set it at 63.3 million by 2015 keeping the target of 9.2 million jobs in five years unchanged.
The number of actual employment during the period under review is still elusive as no comprehensive updated statistics is available. LFS-2013 showed that additional 4 million jobs were created in three years between 2010 and 2013. For the next two years the number was estimated at only 0.6 million, as per the above mentioned quarterly survey data of the BBS. Thus, total job creation during the 6FYP period stood at only 4.6 million. Definitely, the number is not realistic. Due to lack of updated data, the planning commission estimated that some 7.3 million additional jobs were created in the country in five years.
So, one thing is clear. Employment target was not achieved during the 6FYP period when the annual average GDP growth was  6.20 per cent.  
Meanwhile, the Seventh Five Year Plan (7FYP) has projected to create some 12.9 million new jobs in five years (2016-2020), of which 2 million jobs are expected to be created abroad. So, additional domestic jobs in next five years would be 9.9 million.  
The target, however, is based on the assumption that economy would grow by 7.44 per cent on an average annually in the five years. The first year or FY16 has already achieved 7.11 per cent growth against the target of 7.20 per cent.
Meanwhile, International Labour Organisation (ILO) in its latest report titled World Employment and Social Outlook - Trends 2017 projected a dismal picture of global job market.  It said that the global unemployment rate may increase to 5.8 per cent in the current year from 5.7 per cent in 2016. Thus, some 3.4 million additional unemployed people will join the rally of already 197.6 million jobless people across the world. So, total global unemployment will reach just over 201 million in 2017. ILO is expecting the global unemployment rate to remain relatively steady in 2018. Nevertheless, the pace of labour force growth is likely to outstrip job creation.  As a result, additional 2.7 million people will be jobless globally in 2018.
Bangladesh is not insulated from the global development. Thus, job creation inside the country is significantly linked to global economic as well as employment trends. In this context, it is important to track the employment situation rightly.  

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