Bangladesh lifted 34 million people out of poverty between 2010 and 2022, but the pace of progress has slowed dramatically since 2016, with rising inequality and weakening job creation leaving nearly 62 million people at risk of sliding back into poverty, according to a major new World Bank assessment released Tuesday.
The “Bangladesh Poverty and Equity Assessment 2025” finds that extreme poverty fell from 12.2% to 5.6% and moderate poverty dropped from 37.1% to 18.7% over the 12-year period, one of the country’s most significant development achievements.
Living standards also improved through wider access to electricity, education, and sanitation.
But since 2016, economic growth has become less inclusive, income inequality has widened, and labour income has weakened, especially for women and young people.
The report warns that one-third of Bangladeshis, nearly 62 million people, remain highly vulnerable, at risk of falling back into poverty due to illness, disasters, or economic shocks.
“For years, Bangladesh has been known for its success in poverty reduction,” said Jean Pesme, World Bank Division Director for Bangladesh and Bhutan.
“But a business-as-usual approach will not accelerate poverty reduction. The fastest path forward is through job creation, particularly for youth, women, and vulnerable populations. A pro-poor, climate-resilient, job-centric strategy will be essential.”
Rural gains strong
Rural Bangladesh led poverty reduction, driven largely by agriculture. But urban progress lagged far behind.
By 2022, one in four poor Bangladeshis lived in a city, reflecting slower job creation outside Dhaka and falling labour participation, particularly among women.
Job creation in manufacturing has stalled and shifted toward less productive sectors.
One in five young women is unemployed, and one in four educated young women lacks a job.
Meanwhile, half of all youth aged 15–29 work in low-paid, low-skill jobs, pointing to a structural skills mismatch.
Both domestic and international migration have been strong pathways out of poverty.
Remittances lifted income for poorer households. But domestic migrants often endure overcrowded, unsafe living conditions, while international migration remains accessible mostly to the better-off due to high upfront fees.
Social protection still missing the poorest
While Bangladesh has expanded its social assistance programs, a new report highlights serious gaps in targeting.
In 2022, 35% of the richest households received social protection benefits, while half of the poorest households were left out.
Subsidies for electricity, fuel, and fertilizer also disproportionately benefited wealthier families.
To reduce poverty and narrow inequality, the World Bank outlines four priorities: strengthening the foundations of productive employment, creating more and better jobs for vulnerable populations, enabling markets that work for the poor through improved regulations and agricultural value chains, and improving resilience through better-targeted social protection and stronger fiscal policy.
“Bangladesh has reduced regional disparities, including the traditional East–West divide,” said Sergio Olivieri, World Bank Senior Economist and report co-author.
“But climate risks are creating new spatial inequalities, especially between rural and urban areas.”
