COVID-19 Outbreak in Bangladesh

Economists for 6-month employment guarantee scheme for jobless

Staff Correspondent | Published: 22:58, Jul 18,2020


A file photo shows workers protesting at the closure of a garment factory and non-payment of wages in Dhaka in April, amid the coronavirus outbreak in the country. Experts and economists on Saturday recommended that the government should consider an employment guarantee scheme for the next six months for people who became jobless due to the COVID-19 fallout. — New Age photo

Experts and economists on Saturday recommended that the government should consider an employment guarantee scheme for the next six months for people who became jobless due to the COVID-19 fallout.

At a virtual programme, they emphasised the preparation of an authentic and actionable database on the country’s labour market linked with job matching and job placement.

The South Asian Network on Economic Modeling arranged the webinar titled ‘COVID-19 and the challenges of labour market in Bangladesh’.

SANEM projected that in a moderate scenario, six million employed people might have lost jobs since April and in the worst scenario, the number of jobless people would reach up to 12.47 million, depending on the level of shocks of the outbreak on cottage, micro, small, medium and large industries.

It also estimated that the national upper poverty level might also have surged to 40.89 per cent from the current 20.5 per cent due to the income losses of people.

Echoing with the SANEM findings, General Economics Division member (senior secretary) Shamsul Alam said that the rate of employment had been falling even before the COVID-19 outbreak.

‘The country lagged far behind the target set at the 7th Five-Year Plan (2016-2020) as it managed to create only 95 lakh jobs against the target of creating 1.29 crore jobs during the period,’ he said.

He said that labour productivity and wages increased in the period in the manufacturing sector while jobs creation in the service sector had not been satisfactory.

COVID-19 has made the unemployment situation worse, he said.

He emphasised the monitoring and evaluation of the stimulus package for economic recovery.

SANEM executive director Selim Raihan said that the government should form a labour and employment commission to assess the current unprecedented situation and recommend necessary measures accordingly while the Bangladesh Bureau of Statistics should be entrusted with collection of data on the situation.

‘The government should consider employment guarantee schemes for the next six months for vulnerable people and introduce new social safety net programmes targeting the labour market as jobless people are not included in most of the SSN programmes,’ he said.

COVID-19 has put additional pressure on the problematic labour market as many have lost jobs¸ many have shifted to inferior jobs, many self-employed in the micro, small and medium enterprises lost capital due to the shutdown and slowdown of economic activities, he said.

He said that the government policy response related to the current labour market challenges had been weak and inadequate and one major challenge was the lack of updated data on the labour market.

Policy Research Institute executive director Ahsan H Mansur said that the temporary unemployment would disappear and most people would get back their jobs once the coronavirus infection disappeared and the economy started growing.

Therefore, the major challenge is to contain the disease and ensure government support for the economy to accelerate recovery, he said.

He, however, expressed concern over investment — public, private and foreign direct — saying that public investment would face problems due to resource constraints while private investment would not pick up pace without improvement in the infection situation.

Attracting FDI from China and other countries should be one of the recovery strategies, he added.

BRAC Institute of Governance and Development executive director Imran Matin said that most people had an uncertain outlook about the future — not only about income but also about the infection — which would affect business confidence and labour dynamics.

International Labour Organisation Bangladesh country director Tuomo Poutiainen emphasised the need for public and private sector collaboration on labour market programmes.

Echoing with the proposal for an employment guarantee scheme, he said that it was possible and might be linked with the stimulus package.

Stimulus should not only be for business and liquidity but should also have a focus on jobs and employment, he said.

He also stressed the need for investment in MSMEs, particularly in relation to the rural economy, and self-employment to activate the labour market and boost the economy.

There should be a labour market information system that has continuity and regularity, he said, adding that the information system should be actionable in job matching and job placement.

SANEM research director Sayema Haque Bidisha presented the key note paper at the webinar while its chairman Bazlul Haque Khondker and research economist Mahtab Uddin spoke at the programme, among others.

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