Thousands of expatriate workers, who were forced to return home or failed to return to their workplaces abroad due the Covid-19 pandemic, are now struggling to make their ends meet as many have almost no savings and remain knee-deep in debt.
According to government data, a total of 141, 036 migrant workers returned home till September 18 this year following the pandemic.
Without any source of income, these returnee workers are now struggling to feed their families and manage daily expenses. On top of that, many of them also cannot find ways to pay off existing loans they took on high interest rates.
Experts say that not only will this huge number of returnee workers create more pressure on the country’s already saturated labour market, but a reduction of consumption by their families will also reduce the flow of money in the market which will have an impact on the entire economy.
Talking to Dhaka Tribune, Md Rubel Islam, who returned home from Saudi Arabia on December 2019, said he failed to return to his workplace in April due to the pandemic.
Rubel went to Saudi Arabia three years ago after spending Tk800,000 and his monthly income was Tk30,000.
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Facing a shortage of funds at that time, he took a loan of Tk400,000 from a local money lender after agreeing to pay Tk20,000 as interest for every Tk100,000 in every six months.
“My employer said I can join work if I can enter Saudi Arabia before the expiry of my visa and Iqama (work permit). My visa expired on September 30 and Iqama will expire on October 18 of this year respectively,” he said in a saddened voice as he is yet to pay back Tk300,000 of his debt.
“We are poor. I am the only earning member in the family. I managed to find work only for a few days during paddy harvesting season. Apart from that, I remained unemployed,” he said.
“For the last nine months, we are struggling to manage daily food. I know pipe fitting work in the construction sector, but I could not find any such job in Bangladesh. Now tell me, how I can feed my family and how will I pay back my debt with such a high interest rate?” he questioned.
Haider Hossain, who had served in Abu Dhabi of the United Arab Emirate (UAE) for a decade and returned home in January on leave, also became a victim of the global catastrophe as he failed to rejoin work despite having a valid visa.
“I was not given a green signal from UAE authorities for returning to my workplace. I have to feed a family of eight on my own. Since my return to Bangladesh, I have remained unemployed. Now, I do not even have the money to buy an air ticket for my return,” said Haider, who hails from Chittagong.
“Seeing no other way, me and my family have resorted to cutting down on our consumption. I now go for cheaper food items. Education of my siblings has fallen into uncertainty due to the lack of funds,” he said.
According to the Refugee and Migratory Movements Research Unit (RMMRU), some 85% of the daily expenditure of families of overseas migrants is met by the remittances they send, while 60% of these families are totally dependent on remittance.
Most returnee migrants have no savings
A majority of these returnee migrants have little or no savings at all as most of their earnings are spent on catering to the needs of their families and repaying loans they took to meet the high immigration costs.
Generally, a worker spends from Tk300,000 to Tk800,000 for migrating to different gulf countries for work. According to a RMMRU study, a male worker spends Tk342,000 on an average to go abroad.
According to a Brac survey on returnee migrant workers, 34% of them have no savings at all, 19% had savings that could meet their living expenses for only two months, while 10% of them said they have already borrowed money to meet their daily needs.
“Bangladeshi workers have to spend much more to go abroad compared to other countries. Most people manage this money by taking loans from money lenders at a high interest rate. On the other hand, family members also depend on the income of migrants in many cases,” RMMRU chair Dr Tasneem Siddiqui said while talking to Dhaka Tribune.
Migrant workers spend most of their money looking after their families and repaying their loans. That is why only a small portion of these families manage to have savings. Only 0.9% migrant families have fixed deposit savings, she added.
Overflow of workers in local job market to reduce wages
According to statistical data available, each year some two million youths are set off to enter the job market, of which some 700,000-800,000 job seekers find employment abroad.
However, this year the scenario has been very different as these aspiring workers failed to secure their spot abroad due to the Covid-19 pandemic.
According to a study covering 12 districts by the International Organization for Migration (IOM), nearly 70% of migrants who returned to Bangladesh between February and June have remained unemployed.
According to government data, a total of 700,159 Bangladeshis went abroad for work in 2019, 734,181 in 2018 and 10,08,525 in 2017.
But in 2020, only 181,273 migrant workers managed to go abroad between January and August, compared to 406,962 over the same period the previous year.
“At least 300,000 aspiring migrant workers were expected to leave the country from March this year till now. Of them, some 100,000 has their visa and papers ready. Moreover, many migrant workers returned home for a vacation. All of them failed to go or return abroad after international flights were suspended due to the pandemic” Brac Migration head Shariful Hasan told Dhaka Tribune.
“Now, all these people will try to enter the local job market. But, the country does not have the capacity to employ all of them as we have a per-existing labor force in the country. Moreover, many people went to their village homes from big towns following job cuts during the lockdown period. All these issues have created an overflow of unemployed labour in the rural economy,” he added.
Zahid Hussain, former lead economist for the World Bank in Bangladesh, said “Among 20,00,000 new laborers entering the market each year, 30% to 50% of them would go abroad if the situation had been normal. But this year, this percentage will join the domestic labor force. This might continue till 2022 until economic recovery of worker receiving countries.”
“It will halt the wage growth in rural economy, as many of them who failed to go abroad or had returned from abroad, will work in the agriculture sector,” he said
Impact on national economy
A provisional estimation of Bangladesh Bureau of Statistics (BBS) said the GDP growth rate of Bangladesh has reached 5.24% in the last fiscal year (FY20) while the economy of Bangladesh, however, grew by a record 8.15% in the fiscal year (FY19).
RMMRU chair Professor Dr Tasneem Siddiqui said: “In our study, we found that many families of returnee migrants have reduced food consumption, which indicates lesser money flow in the national economy. In the long run, it will affect the normal economic growth of the country.
With families reducing consumption of milk, egg and meat, it will have an adverse effect on the growth of poultry and dairy farming, she said.
“Like this, reduction in different product consumption will affect the growth of different sectors,” she added.
A total of 14 million Bangladeshi have gone abroad to find work since 1976.
