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Unemployment


Unemployment involuntary idleness due to lack of work. Unemployed refers to persons belonging to the labour force, seeking but not doing any work during a specified period. The Labour Force Survey (LFS) of Bangladesh in 2005-06 considered a person of age 15 years and over as unemployed if he/she did not work at all during the preceding week of the survey but was actively looking for work or was available for work. This concept of unemployment in Bangladesh is supplemented by the concepts of visible and invisible underemployment.

According to the Labour Force Surveys (LFS) of Bangladesh 2002-03 and 2005-06, the total civilian labour force of the country was 56.3 and 49.5 million, of which 36.0 and 37.4 million were male and 10.3 and 12.1 million were female respectively. But employed population rose to 44.3 and 57.4 million of which 34.5 and 36.1 million were male and 9.8 and 11.3 million were female respectively. As a result unemployed population grew to 2.0 and 2.1 of which 1.5 and 1.2 were male and 0.5 and 0.9 million were female. With the labour force growing faster than the employment potential, the number of unemployed persons increased over time.

During these two LFS, the total not in civilian labour force was 34.5 and 35.1 million of which in household work 24.9 and 24,1 million, student 6.3 and 6.5 million and in other inactive were 3.2 and 4.4 million respectively. Employment in Agricultural sector in these two survey periods was 51.7% and 48.1%. According to LFS of 2005-06, it is observed that highest 41.98 percent of labour force is engaged in selfemployment which was 44.70 percent in 2002-03. It may be noted that during the two survey periods, the number of self-employed labour force decreased by 2.72 percent. Again according to the LFS of 2005-06, 18.14 percent of labour force was engaged as daily labourers and 13.92 percent as full time employed workers, which was 20.09 percent and 13.77 percent respectively according to the previous survey. Female workers are especially disadvantaged in terms of quality of employment. Of the 10.3 million labourers who are employed as unpaid family workers, 6.8 million (66 percent) were female workers in 2006. This also shows that, of the 11.3 million female labour employed in 2006, 60% work as unpaid family workers while similar share for male employed labour is less than 10%.

Table 1 Key findings of Labour Force Surveys of 2002-03 and 2005-2006 (in million).

Description of sector wise population 2002-2003 2005-2006
Total Male Female Total Male Female
Labour Force 46. 3 36.0 10.3 49.5 37.4 12.1
Employed population 44.3 34.5 9.8 47.4 36.1 11.3
Unemployed population 2.0 1.5 0.5 2.1 1.2 0.9
Not in labour force 34.5 5.2 29.3 35.1 5.7 29.4
Unemployment rate 4.3 4.2 4.9 4.2 3.4 7.0
Under employment rate 37.6 n/a* n/a* 24.5 10.9 68.3
Unpaid Family worker 8.1 3.4 4.7 10.3 3.5 6.8
Employment by Sector
Informal Sector 9.2 7.2 2.0 10.2 8.6 1.6
Informal Sector 35.1 27.2 7.9 37.2 27.5 9.7

Source Labour Force Surveys of 2002-03 and 2005-2006 *n/a- not available.

In the LFS, the underemployed refer to those who work less than 35 hours during the reference week of the survey. Conceptually, the notion of underemployment is related to a situation when a person's employment is inadequate in terms of hours of work, income earnings, productivity and use of skills, and the person is looking for better or additional work in conformity with his/her education and skills. In practice, the measurement of underemployment faces a number of difficulties and the adopted methodology in Bangladesh is to estimate underemployment on the basis of hours worked alone.

The perception of the labour market substantially changes when underemployment is taken into account in assessing the status of the labour force in Bangladesh. The rate of underemployment was 37.6 percent in 2002-03 and 24.5 percent in 2005-06. According to the Labour Force Survey 2005-06, underemployment rate of male and female was 10.9 and 68.3 respectively. In this period labour force participation rate was 58.5%, of which male's 48.8% and female's 29.2%.

Since agriculture has not been able to absorb increased labour force there has been large migration from rural to urban areas. Informal labour force dominates the labour market. Of the total employed labour, 10.2 million (22%) were employed in the formal sector while the remaining 78% were employed in the informal sector.

According to the LFS 2005-06, the total labour force is estimated to grow to 50.6 million, 51.8 million and 53.0 million in FY07, FY08 and FY09 respectively. So, the number of employed labour will be 48.5, 49.74 and 51.05 million, and the number of unemployed will be 2.1, 2.06 and 1.99 million in the same year. In other words, projected the rate of unemployed will be 4.17, 3.98 and 3.76 percent (table 2).

Table 2  Estimated unemployed labour force during the Fiscal Year of 2007-2009 (in million).

Description 2005-06 (surveyed) FY07 (estimated) FY08 (estimated) FY09 (projected)
Total labour force 49.50 50.60 51.80 53.04
Employed labour 47.43 48.49 49.14 51.05
Unemployed labour 2.07 2.11 2.06 1.99
Unemployment rate 4.18 4.17 3.98 3.76

Source  2005-06 Labour Force Survey, BBS and policy analysis unit, Bangladesh Bank, June, 2008.

Unemployment among the educated youths is one of the major problems in Bangladesh. The unemployment rate for the population having secondary school certificate level education and above is significantly higher than those with a lower level of education. The unemployment rate for educated women is higher compared to that for the male population.

Bangladesh, like other developing countries, suffers from large-scale disguised unemployment in the sense that, even with unchanged techniques of agriculture a large part of the population engaged in agriculture could be removed without reducing agricultural output. Beyond agriculture, disguised unemployment also exists in large industries, offices and organisations, particularly in the public sector.

Circumstances causing involuntary unemployment are numerous. But they can be conveniently grouped under the heads such as seasonal variations, industrial and technological change, labour market imbalance, business cycles, and lack of complementary resources. The seasonal cropping pattern of agriculture generates a heavy demand for labour during the peak season but keeps substantial labour idle during the slack season. Agricultural labour remains busiest in the months of June and July. The possibility of work-sharing or low intensity of work is unlikely in these months and on the average, 10 hours are worked daily. Employment opportunities for the agricultural labour are moderate during March, April and May and rare in September and October. Besides agriculture, seasonal un- or underemployment prevails in industry and construction sectors also. In retail trade, there are sharp increases in employment during various festival periods and heavy layoffs immediately afterward.

In Bangladesh salaried/wage employment in the formal sectors is not big enough to take care of the huge number of unemployed. Employment promotion, especially, creation of self-employment opportunities, continues as the most important functions of the Bureau of Manpower Employment and Training. The Fifth FiveYear Plan for 1997-2002 had set a target of creating additional employment of 6.35 million persons. Of this, a total of 1,60,000 persons are expected to be engaged in self-employment. Emphasis had been given on training and credit support to women micro entrepreneurs in cottage industries and other traditional and non-traditional sectors including skill development for service industries and other non-farm activities. The private sector and NGOs are also playing a vital role to this end.

To meet critical situations, especially in near famine or post disaster periods, the government conducts emergency relief programmes but they are no more distribution of direct relief, or the dole. Such activities have been integrated with food for work programmes to provide employment opportunities to large numbers of idle workers and to involve them in efforts towards improvements of infrastructure. [Priyabrata Paul]