Dr. Atiur Rahman :
Governor, Bangladesh Bank
Growth path and economic transformation mattering most for labor income (job creation) and higher labor productivity for bottom 40 percent of population: The bottom 40 percent of the population of my country Bangladesh is still in poverty even as the economy keeps growing at gradually increasing pace in stable macroeconomic environment with moderate inflation. Predominantly agrarian at her birth in 1971, Bangladesh economy has transformed over the decades into a manufacturing and services dominated economy, annual real GDP growth rate has edged up from low single digit levels of early years to a little above six percent for over a decade now. Over a third of the estimated 2010 labor force of 56.7 million was in the 15-29 year age group. Less than ten percent of the labor force was in professional, technical or managerial jobs, with the large bulk in low end informal employment or self employment; their productivity remaining depressed by poverty driven disadvantages in health, education and job training.
In such a context, inclusive equitable socioeconomic development is the obvious choice of option for job creation and labor productivity. Bangladesh government’s private sector led inclusive development strategy pursues empowerment of the poor with social sector public expenditure outlays in healthcare, education and job training; alongside support initiatives for job creation in agriculture, manufacturing and services. Much of the support initiatives are focused on SMEs, as these typically create lower end jobs matching the available lower end skills in the labor force, at lower capital outlays than possible in large industries. Inadequacy in access to finance is a typical constraint for SMEs even in developed economies; both the government and central bank in Bangladesh are proactive in addressing this constraint.
Support measures for farm and off-farm SME financing include (i) a Bangladesh Bank (BB) led motivational initiative of ingraining an inclusive and environmentally responsible financing ethos in the country’s financial sector, (ii) consultatively set indicative credit disbursements targets for agricultural, SME and green financing, (iii)low cost refinance lines from BB for banks and financial institutions against their lending to farm/off-farm SMEs and to environmentally benign ‘green’ projects, the refinance support against SME financing also conditional on significant involvement in financing women owned SMEs (iv) similar low cost refinance line from the government funded PKSF to licensed MFIs against their lending to micro enterprises,(v) a special refinance line for agricultural lending to landless sharecroppers by a reputed large MFI, and(vi) government funded interest subsidy on loans to growers of spices and some other exotic high value crops. External development partners like the ADB and JICA are co financing some of the refinance lines from BB against loans to SMEs and ‘green’ initiatives.
These support measures for farm and off-farm SME financing and for green financing are creating new jobs in hundreds of thousands annually. BB led massive upgrading of the country’s payments system and financial sector IT infrastructure to facilitate cost efficient mobile phone/smart card based inclusive financing is also spawning new jobs in financial service delivery outlets countrywide in hundreds of thousands.
Sustained strong trends of private and public sector construction of residential, commercial, industrial and physical infrastructures are likewise creating jobs in hundreds of thousands in the construction subsector in the first round; and in repair, maintenance and upkeep thereof in the second round.
With support of development partners the government is pursuing a comprehensive plan for upgrading education and skills development training of the labor force with sharper focus on actual needs in the job market.
While the streams of tens of thousands of tech savvy young science and technology graduates from our universities newly entering the labor force every year are steadily enriching the skill sets at the higher end; Bangladesh will need to maintain sustained focus on job creation in farm and off-farm SMEs and green initiatives, for inclusivity and environmental sustainability in her development efforts.
Identifying a country’s most pressing job challenges- given demographic and structural challenges-data needs: Regular periodical rounds of censuses, labor force surveys, household income and expenditure surveys are available to policy makers, think tanks and others interested in analyzing job creation and labor productivity enhancement challenges.
Skills and experience in carrying out systematic impact assessments of the various initiatives taken up for supporting job creation and upgrading labor productivity are however in short supply in Bangladesh; capacity building assistance of the WB group and other development partners will be welcome in this area.
Ingredients of successful job strategies in different contexts; roles of public and private sector; key knowledge gaps: There are significant contextual diversities in labor market conditions and intervention needs across regions, even in a largely homogeneous, geographically moderate sized country like Bangladesh. Development initiatives in Bangladesh try to take due account of these diversities and design appropriate mix of public and private sector initiatives.
For example, job challenges specific to seasonal flood prone low lying North Eastern region and the cyclone, salinity and coastal tidal surge prone South Western regions of Bangladesh are receiving concerted special attention of the public authorities, private sector civil society NGOs and the development partner community.
Totally free mobility of labor and capital between various regions keeps the regional divergences more easily addressable and hence less worrisome in Bangladesh, which may not be the case in larger, less homogeneous countries with rigidities in labor and capital mobility across regions.
How can the international community best organize knowledge, technical assistance, advice, investments and interventions to help find improve and share global solutions to tackle the jobs agenda: A short answer will be: by building up a global repository and clearing house of knowledge on country experiences and approaches gleaned through continuous close engagements at country level with concerned public authorities, private sector business chambers, labor unions, civil society organizations and think tanks.
Governor, Bangladesh Bank
Growth path and economic transformation mattering most for labor income (job creation) and higher labor productivity for bottom 40 percent of population: The bottom 40 percent of the population of my country Bangladesh is still in poverty even as the economy keeps growing at gradually increasing pace in stable macroeconomic environment with moderate inflation. Predominantly agrarian at her birth in 1971, Bangladesh economy has transformed over the decades into a manufacturing and services dominated economy, annual real GDP growth rate has edged up from low single digit levels of early years to a little above six percent for over a decade now. Over a third of the estimated 2010 labor force of 56.7 million was in the 15-29 year age group. Less than ten percent of the labor force was in professional, technical or managerial jobs, with the large bulk in low end informal employment or self employment; their productivity remaining depressed by poverty driven disadvantages in health, education and job training.
In such a context, inclusive equitable socioeconomic development is the obvious choice of option for job creation and labor productivity. Bangladesh government’s private sector led inclusive development strategy pursues empowerment of the poor with social sector public expenditure outlays in healthcare, education and job training; alongside support initiatives for job creation in agriculture, manufacturing and services. Much of the support initiatives are focused on SMEs, as these typically create lower end jobs matching the available lower end skills in the labor force, at lower capital outlays than possible in large industries. Inadequacy in access to finance is a typical constraint for SMEs even in developed economies; both the government and central bank in Bangladesh are proactive in addressing this constraint.
Support measures for farm and off-farm SME financing include (i) a Bangladesh Bank (BB) led motivational initiative of ingraining an inclusive and environmentally responsible financing ethos in the country’s financial sector, (ii) consultatively set indicative credit disbursements targets for agricultural, SME and green financing, (iii)low cost refinance lines from BB for banks and financial institutions against their lending to farm/off-farm SMEs and to environmentally benign ‘green’ projects, the refinance support against SME financing also conditional on significant involvement in financing women owned SMEs (iv) similar low cost refinance line from the government funded PKSF to licensed MFIs against their lending to micro enterprises,(v) a special refinance line for agricultural lending to landless sharecroppers by a reputed large MFI, and(vi) government funded interest subsidy on loans to growers of spices and some other exotic high value crops. External development partners like the ADB and JICA are co financing some of the refinance lines from BB against loans to SMEs and ‘green’ initiatives.
These support measures for farm and off-farm SME financing and for green financing are creating new jobs in hundreds of thousands annually. BB led massive upgrading of the country’s payments system and financial sector IT infrastructure to facilitate cost efficient mobile phone/smart card based inclusive financing is also spawning new jobs in financial service delivery outlets countrywide in hundreds of thousands.
Sustained strong trends of private and public sector construction of residential, commercial, industrial and physical infrastructures are likewise creating jobs in hundreds of thousands in the construction subsector in the first round; and in repair, maintenance and upkeep thereof in the second round.
With support of development partners the government is pursuing a comprehensive plan for upgrading education and skills development training of the labor force with sharper focus on actual needs in the job market.
While the streams of tens of thousands of tech savvy young science and technology graduates from our universities newly entering the labor force every year are steadily enriching the skill sets at the higher end; Bangladesh will need to maintain sustained focus on job creation in farm and off-farm SMEs and green initiatives, for inclusivity and environmental sustainability in her development efforts.
Identifying a country’s most pressing job challenges- given demographic and structural challenges-data needs: Regular periodical rounds of censuses, labor force surveys, household income and expenditure surveys are available to policy makers, think tanks and others interested in analyzing job creation and labor productivity enhancement challenges.
Skills and experience in carrying out systematic impact assessments of the various initiatives taken up for supporting job creation and upgrading labor productivity are however in short supply in Bangladesh; capacity building assistance of the WB group and other development partners will be welcome in this area.
Ingredients of successful job strategies in different contexts; roles of public and private sector; key knowledge gaps: There are significant contextual diversities in labor market conditions and intervention needs across regions, even in a largely homogeneous, geographically moderate sized country like Bangladesh. Development initiatives in Bangladesh try to take due account of these diversities and design appropriate mix of public and private sector initiatives.
For example, job challenges specific to seasonal flood prone low lying North Eastern region and the cyclone, salinity and coastal tidal surge prone South Western regions of Bangladesh are receiving concerted special attention of the public authorities, private sector civil society NGOs and the development partner community.
Totally free mobility of labor and capital between various regions keeps the regional divergences more easily addressable and hence less worrisome in Bangladesh, which may not be the case in larger, less homogeneous countries with rigidities in labor and capital mobility across regions.
How can the international community best organize knowledge, technical assistance, advice, investments and interventions to help find improve and share global solutions to tackle the jobs agenda: A short answer will be: by building up a global repository and clearing house of knowledge on country experiences and approaches gleaned through continuous close engagements at country level with concerned public authorities, private sector business chambers, labor unions, civil society organizations and think tanks.
