More educated youth facing higher unemployment: Dr Fahmida Khatun

The more time spent in formal education, the higher the unemployment rate in the country, according to Executive Director of the Centre for Policy Dialogue Dr Fahmida Khatun.

“There is an unusual relationship between education and unemployment, and unfortunately, it’s not favorable. We observe a alarming trend where individuals struggle to find employment as their level of educational qualification rises,” the CPD executive director said today (8 June) during a webinar on “Youth unemployment in “Bangladesh” organised by the Forum for Bangladesh Studies.

Dr Fahmida highlighted that educated youth, particularly those with 11 years or more of institutional education, face prolonged unemployment despite their qualifications. Besides, women with more than nine years of institutional education experience higher unemployment rates.

“On the other hand, those with less than seven years of institutional education have significantly lower unemployment rates, finding employment more easily,” she added.

Citing the Bangladesh Institute of Development Studies (BIDS) data, Dr Fahmida said the unemployment rate in the country is 3.6%, with youth unemployment accounting for about 80% of this figure.

Additionally, the NEET (Not in Education, Employment, or Training) rate stands at 30%, a statistic Dr. Fahmida described as “terrible.”

She criticised the current method of measuring unemployment, based on International Labour Organization (ILO) guidelines, which consider individuals who work at least one hour per week as employed.

Dr Fahmida argued that this approach doesn’t accurately reflect unemployment in Bangladesh, where short-term employment is uncommon.

“The unemployment rate in the country, as per BIDS data, stands below 4%, based on the International Labour Organization (ILO) guidelines, which consider individuals working at least one hour per week as employed. However, this figure does not accurately reflect the true unemployment scenario in our country, as it is uncommon for people to hire someone for just an hour,” she explained.

She further said, “The economic recession has significantly impacted our country’s overall economic stability. Despite this, our growth trajectory remains positive. However, private sector investment in our country is notably lower compared to GDP, standing at about 23.5%. While we have witnessed GDP growth over the last decade, employment growth has not kept pace, particularly evident in the declining employment opportunities in the agricultural sector.”

“Approximately 90% of total employment in the industrial sector and about 68% in the service sector are informal,” she noted, adding that informal recruitment practices hinder the creation of decent employment opportunities.

As a panel discussant, Fahim Mashroor, CEO of bdjobs.com, expressed grave concern over the alarming state of youth unemployment in the country.

He warned that the current trajectory of the country’s economy could exacerbate the unemployment crisis further.

“Our job market has remained stagnant since the onset of the pandemic, despite our transition from a less developed country to a developing one,” he lamented.

He highlighted a significant skills gap among students, noting that many college and university graduates aspire to work for multinational companies but lack the necessary language and communication skills.

“In the past, government jobs were preferred by individuals from rural areas. However, even urban students now show a strong inclination towards government employment over private sector jobs,” Fahim observed.

He pointed out the challenge faced by organizations in sifting through a large number of applications for a single job posting, attributing this to the lack of adequate skills and training among applicants, despite their institutional education.

He further said, “While the government is allocating a significant portion of the budget towards skill development, I believe that directing industry-centric funding through the private sector, rather than solely focusing on institutional programs, would yield more impactful results.”