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Path to middle-income nation: organised labour market, skills building

WB says in new jobs report

Star Business Report
THE country should focus on developing an organised labour market and rearing its large pool of unskilled labour if it wants to become a middleincome country by 2021, said a World Bank study.
The potential for creating good jobs by further encouraging upward mobility of the relatively unskilled labour through transition from the farm to non-farm sectors are yet to be exhausted, the multilateral lender said in the report, World Development Report 2013: Jobs.
The report, which conducted a case study on Bangladesh as a background paper, found that Bangladesh has been successful in generating jobs which have been accelerating growth and promoting development.
"Over the years, Bangladesh has made a remarkable transition from its alleged status as an international basket case heavily dependent on foreign aid to a lead performer among the least-developed countries, which is now poised to become a middle-income country by 2021."
Around 2.2 million people enter the job market annually, while nearly 1 million get jobs, Johannes Zutt, WB country director for Bangladesh, said at a dialogue yesterday with the stakeholders of the report.
The report said the country has maintained a "reasonably high growth with the least volatility", accompanied by "impressive" poverty reduction and human development record on a range of social indicators.
The challenge for the country now lies in maintaining this momentum, WB said.
Zutt said the country can set a target to create additional 15 million jobs within the next ten years by establishing more economic zones.
Subsequently, the report recommended paying attention to the relatively neglected dimensions of job creation in Bangladesh: the issue of informality of the labour market and the skills development for meeting the potential demand for relatively educated jobs, especially in export sectors and overseas migration.
The study found that one unique characteristic of the Bangladeshi labour market was its relatively low unemployment and large proportion of informal labourers.
This can be a structural issue facing Bangladesh as the country aims to become a middle-income one, it said. For moving to the next stage of development, a more organised labour market environment would be important.
The report also found that Bangladeshi migrant workers are taking "relatively low-skilled and low-paid jobs" in comparison to their counterparts from neighbouring countries like India and Nepal. "It is therefore necessary to consciously redirect the skill demand to higher skills and build a strong foundation of skills among the populace."
Articulating a comprehensive vision for skill development encompassing all levels of education and policy priorities over the short and medium terms are of "great importance", it added.
Creation of good jobs can bring significant social and economic transformations, said Binayak Sen, research director of Bangladesh Institute of Development Studies, who is also a co-author of the Bangladesh chapter of the report.
Shaheen Anam, executive director of Manusher Jonno Foundation, said the country' has improved its job scenario mainly due to women's empowerment, while stressing the need to bring domestic workers under the jurisdiction of labour law.
Atiqul Islam, president of the Bangladesh Garment Manufacturers and Exporters Association, said the garment sector is facing a severe skill shortage especially in midlevel management due to a poor education system.
As a result, the factory owners have to resort to hiring foreign professionals, he said, while advising the government to focus more on vocation education.
Md Mujibul Haque, minister for labour and employment; MA Mannan, state minister for finance; and Martin Rama, chief economist for south Asia region of WB, also spoke at the dialogue co-organised by the Campaign for Popular Education and WB at the capital's Sonargaon Hotel.
Rasheda k Choudhury, executive director of CAMPE, moderated the dialogue.