The rapid expansion of Artificial Intelligence (AI), automation, and technology-driven manufacturing systems is raising alarms over a major employment crisis in Bangladesh’s readymade garment (RMG) sector.
Without urgent policy interventions and comprehensive skill development initiatives, approximately 1.22 million workers could see their jobs eliminated by the year 2041.
According to a new study by the Centre for Policy Dialogue (CPD), female workers are set to bear the brunt of this technological transition.
The report warns that up to 60% of current female employment in the apparel sector could be entirely wiped out as factories increasingly swap manual labor for automated machinery.
The findings were unveiled on Wednesday, July 15, during a virtual webinar titled "The Changing Workplace: Foresight on the Future of Work in the Global South."
Towfiqul Islam Khan, senior economist and research director at CPD, presented the keynote paper.
The report notes that this technological displacement arrives at a critical juncture.
As Bangladesh prepares to graduate from the Least Developed Country (LDC) status to a developing nation, its labor market is facing a perfect storm of structural challenges.
According to CPD’s empirical data, the labor market is already registering major shifts.
In 2024 alone, total national employment contracted by roughly 1.3 million jobs—and female workers accounted for nearly 90% of those losses.
As technology alters traditional manufacturing, labor-intensive sectors are seeing their employment dynamics shift at an unprecedented pace.
A particularly concerning finding in the CPD study is the decoupling of industrial output and job creation.
While overall manufacturing production volumes in Bangladesh continue to climb, net employment within the manufacturing sector has remained completely stagnant, plateauing at 8.1 million workers.
Concurrently, while the service sector has grown to employ roughly 25 million people, the vast majority of these individuals are trapped in informal, low-productivity, and financially insecure gig roles.
To map out these challenges, researchers analyzed 27 national and global variables to project four potential labor market scenarios for the year 2035.
Across all tested scenarios, key trends remained constant: accelerated digitization, a structural shift toward high-value services, persistent skill deficits, high vulnerability to global economic shocks, and the vital role of state institutional capacity.
Towfiqul Islam Khan pointed out that local policymakers are struggling to keep up with these rapid labor shifts.
There remains a deep, systemic mismatch between the skills taught in academic institutions and the actual technological demands of modern industrial operations.
Compounding the problem, student enrollment in Technical and Vocational Education and Training (TVET) at the secondary school level remains below 20%.
Furthermore, public spending on education and human capital development sits at a mere 1.3% of national GDP—a level experts describe as wholly inadequate for an AI-driven global economy.
Dr Debapriya Bhattacharya, distinguished fellow at CPD, added that global employment frameworks are transforming rapidly, yet national policymaking remains dangerously slow.
The combination of skill deficits, mismatched educational outcomes, and the uninhibited spread of generative AI is creating highly complex vulnerabilities for developing economies.
The report also cited projections from the World Economic Forum, noting that while AI and automation will generate roughly 11 million new tech-centric jobs globally by 2030, they will simultaneously destroy 9 million traditional positions.
In this environment, continuous reskilling is the only path to economic survival.
The CPD report identified several major weaknesses in Bangladesh's current regulatory frameworks:
- Gig Economy Blindspots: A total absence of comprehensive, legally binding guidelines to protect platform and gig-economy workers.
- Automation Neglect: National industrial strategies fail to systematically account for the disruptions caused by shop-floor automation.
- Mismatched Training: Weak administrative links between state-run vocational training centers and the private sector's actual technical needs.
- Lack of Execution: An overarching absence of actionable, time-bound roadmaps to implement existing labor welfare policies.
Policy roadmap for the digital era
To prevent massive technological displacement and ensure long-term stability, the think tank outlined a set of urgent policy recommendations.
Action Arena | Recommended Strategy |
Vocational Reform | Modernize TVET curriculums to match automated industrial setups and high-tech manufacturing. |
Lifelong Skilling | Launch state-funded, continuous reskilling and upskilling programs targeting vulnerable workers. |
Fiscal Incentives | Link corporate tax breaks and export incentives directly to human workforce retention and upskilling metrics. |
Data Architecture | Establish a centralized National Labor Market Information System (LMIS) to map real-time supply and demand. |
Social Safety Nets | Extend formal legal protections, medical insurance, and pension frameworks to platform and gig workers. |
The study concludes that Bangladesh’s labor market has reached a critical turning point.
Transforming future technological disruptions into opportunities for sustainable, inclusive growth will be impossible without aligning the workforce with digital realities, enforcing agile policies, and securing strong political commitment.
