Unemployment Problems and Its Solution

There are many solutions which are interlinked with one another and such type of policies should
be taken simultaneously. They are NOT arranged according to their importance; from my
perspective all solutions have their own significance in reducing unemployment.

 District wise economic advantages -creating employment in every district distinctly

We should look forward to district wise economic advantages as some districts will be suitable for
agriculture and some districts will be suited for manufacturing or service sectors. Therefore we
emphasize on those economic activities in which districts enjoys comparative advantages. Local
labors are usually expert in the local economic activities. So such type of endorsement of local
economy will help to expand local economy by trade and eventually reduce unemployment.

 Building infrastructure & well integrated national and international market

Infrastructure building creates employment. Infrastructure itself connects local markets and creates
well integrated national market. Projects like Padma Bridge, Karnaphuli tunnel are such initiatives to
connect local market into national market. These initiatives increase economic activities and
eventually increase employment opportunities.

International projects like BCIM (Bangladesh-China-India-Myanmar) economic corridor and BRI

(Belt and Road Initiatives) can increase job opportunities for Bangladeshi labor as there will be
increased economic activities for such type of initiatives.

 Economic Zones

Government has created Economic Zones to attract investment so that new factories are built and new
employment is created. There is an authority called Bangladesh Economic Zones Authority (BEZA).
Now the main challenge is to maintain the effectiveness of such economic zone. If the purposes of the
economic zones are fulfilled then unemployment can effectively be reduced.

 NGOs development activities and Micro-credit opportunities

Increasing savings and investment is a sustainable way to increase employment. BRAC, one of the
most successful NGOs in Bangladesh and the World has done it by initiating poor women to save and
to get self-employed. Grameen Bank has also such type of contribution by offering poor women credit
and to get self-employed. All of these initiatives were success.

 Local R&D

Local research and development activities create technologies that suites local environment. Local
technologies are mostly cheap and best suited for the existing capital-labor ratio. Labor intensive
technologies produced locally can really help to reduce unemployment at the same time increasing
output.

 Vocational Education

Vocational education gives unemployed people a great opportunity as mostly unskilled labor get
dismissed from job or do not get job. Vocational education is formally known as TVET (Technical
and Vocational Education and Training). TVET program is essential for implementing others policies
mentioned here in the writing. STEP (Skills and Training Enhance Project) like TVET is also helping
to increase skilled labor force.

 Creating effective market demand

Creating effective market demand is a sustainable solution to the unemployment problem. Now the
question arises how to do it.

(1) We need to attract investors who will invest on advanced diversified manufacturing sector
(2) Now the second question is how to attract investors

Investors can be convinced by telling them there are too many youth. Bangladesh being labor
intensive country, investors will get better capital returns.

(3) Youth means many opportunities. The age structure will show that :

Age Structure:

Age Groups Percentage of population

0-14 years 27.29%

15-24 years (youth) 19.14%

25-54 years 40.07%

55-64 years 7.09%

65 years and over 6.42%

[Data Source: CIA World Fact book, 2018 estimated]

As we can see there are 19.14% of our population is young. Targeting this age group, policy
makers should promote vocational education and quality education. Vocational education will
promote the youth to get decent and relatively high wage job in a shorter period of time. Quality
education should be emphasized on all the sectors in the education (i.e. primary, secondary and
tertiary). Such of type of policy will make the youth labor force more skilled and efficient.

When there is skilled labor supply and effective labor demand, market will enhance and
unemployment will be reduced.

 Balance between agricultural and industrial sector

When capital intensive technology creates surplus labor in agricultural sector, there should be
employment opportunity for those surplus labors. Otherwise, they get unemployed (that’s what
happened in Green Revolution). Manufacturing sector can be a better option for them. If labor
demand of manufacturing sector increases at the same rate of surplus labor creation in the agricultural
sector, there will not be such unemployment problem. But here also surplus labor should be trained so
that they can adapt to manufacturing sector.

 Improving doing business rank

Improving ease of doing business will necessarily help to reduce unemployment as investors will find
it easier and profitable to invest. Government should ensure the access to electricity, gas and internet
to everywhere in the country with relatively lower cost.

 Occupational safety and health

Occupational safety and good health of the labor force increase working efficiency. More working
efficiency means more output and more output means more employment.

 Improving law and order, CPIA property rights and rule-based governance rating

Political stability, better law and order and enforcement creates environment for investment which
will eventually increase employment. Property rights must be ensured in order to expand job creation.

 Strengthening quality education

Quality education can help reduce unemployment in a sense that it creates labor force more skilled
and efficient. Investors will be willing to invest in an economy if there is existing skilled labor force
for their purpose. Investors eventually invest and create effective labor demand for the skilled labor
force. But the problem is there should be investment on infrastructure that will create employment at
the same time when the skilled labor force enters into the market.

 Exporting skilled labor force

Govt. can export some skilled labor force which will reduce pressure of large population in policy
implementation. Non-resident Bangladeshi will send remittance which will increase the economy of
our own by increasing consumption expenditure in our country and govt. will also get some tax
revenue will can be used in development purposes.

Exporting skilled labor force can be a sustainable solution to unemployment problem.

(1) It is often difficult to implement development policies for large population. Labor export can
reduce pressure of large population living in Bangladesh and creates an optimal situation for
policy makers to implement policies.
(2) Furthermore, remittance comes from the earnings of expats increases consumption,
investment in Bangladesh which will eventually boost development effort.
(3) Exporting skilled labor force to foreign capital intensive countries can be very profitable for
Bangladesh. Bangladesh itself is a labor intensive country with 66.64 million labor force
[source: CIA World Fact Book]. Although there is extensive migration of labor force to KSA,
 Kuwait, UAE, Qatar, Oman and Malaysia, the remittance from expatriates is currently
declining. From the following time series graph we can clearly understand the matter.

Time Series of Personal Remittances Recieved

18000000000

16000000000

14000000000

12000000000

10000000000 Time

Personal Remittances,
8000000000 Personal
Received (current US$) remittances,
6000000000 received
(current US$)
4000000000

2000000000

0
76 79 82 85 88 91 94 97 00 03 06 09 12 15
1 9 1 9 19 19 1 9 1 9 19 19 2 0 2 0 20 20 2 0 2 0
Year

[N.B.: Data on “personal remittances received” was collected from World Bank]

One of the main reason of such type of declining pattern in remittance receives is Bangladeshi
expatriate labors are unskilled. When oil economies (i.e. KSA, Kuwait, UAE, Qatar, and Oman)
suffer from low oil price, companies sack unskilled labor first. Therefore it is necessary to export
skilled labor force. Besides quality education, TVET (Technical and Vocational Education and
Training) is a better solution to transform unskilled labor force into a skilled one in a shorter
period of time.

(4) TVET program should be targeted to drop-outs unskilled young people (aged 15-24) who are
looking for job. This will help them to come out depression and get a high wage job both in
Bangladesh market and foreign market.

 Entrepreneurship

Entrepreneurship is a one of the excellent way to increase employment. It creates new job
opportunities for unemployed population especially the young ones. One of the reason
entrepreneurship reduce youth unemployment is entrepreneur needs to take risk and young
people(aged 15-24) are intended to take more risk than any other age group in working
population. Like many other policies, entrepreneurship can be fruitful if there are situations
favorable to entrepreneurs. Entrepreneurs not only employ themselves but also employ other
people that create labor demand and unemployment goes down.
 Women empowerment

Women empowerment can effectively reduce youth unemployment. Now the question is how it
works. Women empowerment means women are more educated, more skilled and more women
participation in the work force as well as more women entrepreneurs. More entrepreneurs mean
more job opportunities.

Women are better debtor than men. So micro-credit initiatives that were given to women were
successful in creating employment. The success stories of micro-credit organizations tell so.