While Bangladesh has witnessed impressive GDP growth over the past decade, its labour market tells a different story.
With the working-age population rising at an annual rate of 1.5% but employment expanding by a mere 0.2%, the country is facing a deepening job crisis.
A widening mismatch between education, skills, and economic opportunities threatens to derail the promise of prosperity for millions.
Across the globe, individuals aged between 15 and 64 years are categorised as the working-age population.
In Bangladesh, this segment has expanded considerably over the past decade, yet employment growth has been worryingly sluggish.
A World Bank analysis based on International Labour Organisation (ILO) data reveals that between 2013 and 2022, Bangladesh’s working-age population increased at an annual rate of 1.5%.
However, employment grew at a meagre 0.2% per year, highlighting a critical gap between economic expansion and job creation.
Experts point out that while large numbers of young people enter the workforce each year, the economy has struggled to provide adequate employment opportunities.
Even the most dynamic and productive firms have failed to generate substantial job openings. Instead, economic instability and political turbulence have contributed to job losses, leading to a higher unemployment rate than the growth rate of both the working-age population and employment itself.
According to the World Bank, Bangladesh’s real GDP grew at an average rate of 6.4% between 2018 and 2024, outpacing the global average.
Poverty rates have also declined significantly, from over 30% in the 1990s to just 5% in 2022.
By 2026, Bangladesh is set to graduate from its Least Developed Country (LDC) status. However, these macroeconomic indicators do not translate into robust job creation.
The World Bank’s report, Frontier Firms and Job Creation in Bangladesh, underscores this contradiction.
While economic metrics paint a picture of prosperity, job creation has not kept pace, leaving millions of young people unemployed or underemployed.
Youth unemployment has worsened dramatically in recent years.
Between 2013 and 2022, job opportunities for individuals aged 15 to 24 shrank by 3.4% annually, pushing youth unemployment from 10% to 16%.
Historically, Bangladesh’s economy was dominated by agriculture, which employed the majority of its workforce.
Over the past five decades, industrialisation has taken centre stage, with the industrial sector now contributing more to GDP than agriculture. However, this transition has not been accompanied by sufficient job creation.
Despite accounting for the bulk of Bangladesh’s industrial revenue, frontier firms—high-performing, innovative companies—have contributed minimally to employment generation.
According to the World Bank, while these firms drive nearly three-quarters of total goods and services sales, they provide just 15% of institutional employment.
The ready-made garments (RMG) sector exemplifies this disparity. Though the sector dominates private industrial revenue, it employs only one in twelve formal private-sector workers.
Brigadier General (Retd) Dr M Sakhawat Hossain, an adviser to the Ministry of Labour and Employment, acknowledges the challenges but emphasises that job creation is ultimately the responsibility of the private sector.
“The government does not create jobs—it merely facilitates conditions for employment generation. The private sector must step up, but it has been hampered by bureaucratic inefficiencies, financial mismanagement, and a lack of genuine entrepreneurship. Industrial growth has been politicised, creating a mafia-like economic structure rather than fostering true enterprise,” he remarked.
He also noted that an excessive focus on the textile sector has led to an unsustainable concentration of jobs.
“We are too dependent on textiles. Many factory owners have taken loans, moved abroad, and left industries stagnant. Meanwhile, the tourism sector remains an untapped goldmine. Proper privatisation could create thousands of jobs, yet little has been done to develop it.”
The disparity between economic growth and employment creation highlights deeper structural issues within Bangladesh’s labour market.
Unless urgent reforms are undertaken to improve education, skill development, and sectoral diversification, the country risks exacerbating its employment crisis despite its overall economic progress.
Without a targeted strategy, millions of young Bangladeshis may find themselves left behind in a rapidly changing economy.
