preparedness for the future world of work.
. . .
Even before Covid-19 hit, Bangladeshi youths were struggling to find productive employment. While a large share of the Bangladeshi labour force had been stuck in a low-skill, low-productivity cycle, technology had been profoundly changing the global job market and changing it fast.
Technology is creating many new jobs requiring higher skills. Meanwhile, many lower-skill jobs, particularly those requiring predictable skills, are disappearing. While the demand for unpredictable low-skill jobs, e.g., cleaners, janitors, and security guards, is likely to remain strong, these jobs usually do not pay well. Because the demand for many other low-skill jobs is anticipated to go down, the competition for the remaining low-paying jobs may increase, further dampening low-skill wages. On the other hand, technology is creating a large number of new occupations, which need various levels of technological, knowledge-oriented, and cognitive skills—from basic digital skills for participating in the platform economy (Food Panda, Uber, for example) to intermediate skills (for online freelancing, for example) to sophisticated, advanced skills (data analyst, software designer, for example)
Skill premium—the ratio of wages between skilled and unskilled workers—has always existed for good reasons. But in the new world of work, skill premium has already become astronomical and will continue growing because of the opposite effect of technology on low and high-skill jobs—the dwindling of the former and the growth of the latter.
It is true that technology is changing the job market in developed countries at a faster rate, but eventually, the change is going to be global. Besides, changes in developed countries directly impact the required skills of migrant workers from countries like Bangladesh.
In Bangladesh, the overwhelming majority of young people are involved in informal, low- productive, low-pay employment. Less than 5% of Bangladeshi youth have tertiary education, yet only about a third of these youth find employment within 1-2 years after graduation. On the other hand, employers struggle to find the right skills to fill professional positions. According to one estimate, 40% of the positions in the IT sectors remain vacant due to skills shortages. Our youth employment sector had been crying for a major overhaul long before Covid.
Covid has only worsened the skills crisis in Bangladesh. The pandemic has expedited the process of the so-called fourth industrial revolution—information and communication technology fundamentally transforming the world. For example, businesses moving online during the pandemic may never return to their brick-and-mortar format, and the skills for the new types of businesses are different. McKinsey and Company estimate that 25% more workers than what was estimated before the pandemic will need to switch work due to e-commerce, automation, and remote work.
To make the skills crisis worse, educational institutions were closed for almost two years in Bangladesh, with very limited distance learning facilities.
Improving traditional skills, e.g., cutting and sewing in the RMG sector is not enough. To safeguard low-skilled workers from future shocks in their sectors and to claim a share in the expanding high-skill, high-tech, highly paid job market, it is imperative to train/retrain a vast number of the population in new/superior skills.
Investing in preparing the youth of Bangladesh for the post-Covid future world of work is not
only critical for Bangladesh to break out of the ‘middle-income trap’, also for the sustainable,
equitable flourishing of our citizens.
_________________________
Imran Matin
Executive Director, BRAC Institute of Governance and Development, BRAC University
Nusrat Jahan
Head, Knowledge Management and Communications, BRAC Institute of Governance and Development, BRAC University
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