The Centre for Policy Dialogue (CPD) has questioned the outcome of GDP growth saying the country has entered into income-less employment from an era of jobless growth.
CPD explained what they meant by “income-less employment” by saying that previously jobless growth accompanied GDP growth. Now there is low income employment growth.
The independent think-tank said, according to the latest labour force survey, around 1.3 million additional jobs were created between 2015-16 and 2016-17. However, the real income of people has declined.
CPD revealed the above at a budget recommendation press conference at CIRDAP Auditorium on Tuesday.
Dr Debapriya Bhattacharya, distinguished fellow of the CPD, said: “To date, we ran after higher GDP – which is important – but the more important thing is decent employment."
“The employment generated in the last two fiscal years was in the informal sector, where workplace status and labour rights are of poor quality.”
He said: “We can debate the GDP growth rate, but more importantly, we have to look into the outcome of it. According to our findings, the country is generating low income employment instead of jobless growth.”
He further said: “As we are not well equipped to measure GDP, we have to analyze economic development by matching growth, income, job, and production rates.”
“If the four components do not match up, it indicates that the development is a matter of concern.”
Towfiqul Islam Khan, a research fellow at CPD, presented budget recommendations while he described how low income employment has been generated in the country.
He mentioned four trends: 1) a majority of additional jobs have been created in informal sectors such as services, 2) there has been an increase in the unemployment rate among the relatively more educated labour force, 3) there has been more employment of men compared to women and more employment of people in urban areas compared to those in rural areas, and 4) disparities between regions in terms of employment generation persist.
“More than one-third of the total youth labour force [34.3%] with tertiary education remained unemployed during the 2016-17 fiscal year,” said Towfiqul.
He urged the government to refocus development objectives from the existing “GDP growth acceleration”-centric strategy to a “high economic growth from decent employment”-centric strategy to reduce low income employment.
“Budgetary allocations for social sectors must be coherent with the overall development needs of the economy,” he added.