Bangladesh employment future is dark unless concern authorities will take necessary steps. Bangladesh is a small country with full of resources and has nearly 17 crores population. She was an agriculture- based country in some years back.
After the independent of Bangladesh, agriculture was the main source of survival for war broken country. At present, Bangladesh is trying to become industrial country to reduce the number of unemployment. But Bangladesh is yet of solve the unemployment problem. As a result, jute- once called golden fiber of Bangladesh, has now out of the market. Let’s talk about Bangladesh economy
Economy of Bangladesh
Previously Bangladesh economy based on agriculture. Many local based companies tried to export agricultural products in many countries. With time flow, Bangladesh has two main sources of foreign revenue earning: ready-made garments and remittance. Millions of people involve in garments industry. On the other hand, more than one crore people are working in foreign countries. They send foreign remittance to their home country. In a word, Bangladesh economy is import-oriented.
Employment of Bangladesh
According to Trading Economics global macro models and analyst expectations, Unemployment Rate in Bangladesh is expected to reach 5.40 percent by the end of 2022. Another statistics shows that unemployment rate in Bangladesh was reported at 5.229 % in 2021, according to the World Bank collection of development indicators. But the actual scenery is different. More than 15% to 20% workable population remains unemployment. A large number of people remain unemployed due to shortage of work.
Foundation of Bangladesh Economy
Bangladesh economy foundation is based on import. Every year import balance is bigger than export balance. For becoming a developed country, export must greater than import. As Bangladesh economy stands on import, dollar is the main exchange medium. So, dollar rate unpredictably fluctuates every now and then.
On the other hand, in Bangladesh, almost 95% workable population work in private section. Remaining 5% population works in public section. Hence, private sectors are the main players to employ almost all work force.
Vicious Circle of Import in Bangladesh
Example 01: Engineering Industry
Suppose, ABC Company wants to open a complete Fan manufacturing plant in Bangladesh. At first, they have to buy machineries from China, or Japan, or any foreign country. They have to hire chief engineer from abroad to install all plant machinery. Now, the plant is ready to go production. For production, they need materials.
From where will they get Fan material?
Let’s say some core materials for Fan: Copper Wire, Rotor and Stator, Plastic material, Copper Sheet, Aluminum sheet and so on. Almost 95% materials they have to import from abroad. Now they are ready to start production. They make fan to sell in local market. From machinery to raw materials, they have to import. Import means dollars go to other countries.
Example 02: Garments Industry
Bangladesh feel proud for “Made by Bangladesh” title on ready- made garments. Does Bangladesh make money for Ready-Made Garment? Answer is “Yes”. But….
Main raw materials for garments are Fabrics, Yarns, Pigments, Chemicals, and so on. From machinery to raw materials, Bangladesh yet depends on import. Let’s break-down cost of making garments.
Generally, we can break down cost like this: Material Cost + Overhead Cost. Material Cost may 70% and Overhead Cost may utmost 30%. 30% overhead consists of working cost -10%, depreciation-5%, electricity-5%, others -10% including rent, interest, tax.
Almost 70% to 80% cost generate from import raw materials to machinery. If the owner is from foreign country, profit also goes to abroad. Bangladesh only gets, cheap labor cost, electricity, rent, bank loan interest and profit from sales. As working cost is too low in Bangladesh, foreign countries prefer to invest in Bangladesh. A giant export earner- garments industry- also depend on import.
China may become a model for Bangladesh
China present population is 1,451,417,308, According to Worldometers Information. Once many industrialists started investment in China for cheap work force. But now? They have turned their luck.
China is searching developing countries like Bangladesh to exploit cheap labor force. They are the world large economy, that is possible for huge population and planning. If Bangladesh can develop policy, she also can turn her luck.
Present Employment Scenery of Bangladesh
At present, private sections highly depend on foreign economic conditions. As a result, jobs in private sectors are highly volatile. An employee may be terminated instantly without prior notice because of business worse situation. Many businesses have to stop for lack of business environment. Most surprising fact: Bangladesh yet to gives birth a mentionable multinational company. If the situation will not improve, unemployment rate will touch the sky!
From Covid-19 to Ukraine – Russian War, Bangladesh has most negative impact than other developing countries. If the remittance warriors didn’t send money to Bangladesh, Bangladesh might become Sri lanka!! Recently, dollar rate crossed 119tk, which remained between 83-46 tk some days back. Inflation rate became more than 20% as daily essential goods price hiked more than 30%.
What should Bangladesh do?
First of all, Bangladesh has to reduce import as much as possible. Secondly, she has to export almost all products. First target should like this: trading surplus (Export is greater than Import).
Agricultural products are a good source of export. Many unnecessary products which may produce locally must be banned to import. If Bangladesh unable to produce certain raw materials locally, she can invest machinery to export. Moreover, Bangladesh should put emphasis on IT sector development.
Bangladesh should find out vicious points to blast economic development. Many foreign countries’ investors are exploiting the valuable cheap labor forces for their betterment. Bangladesh has to independent on Agriculture, IT, Heavy industries. Otherwise, Bangladesh employment future will dark. As a result, unemployment rate will continuously increase.
Read More: 80 Most Profitable Small Business Ideas in Bangladesh