Bangladesh’s window to accelerate growth through its favorable age structure is narrowing, the World Bank has warned.
The country’s demographic dividend is expected to peak in 2045, but Bangladesh is lagging in job creation, women’s labor participation and development of skilled workers, according to a report released Tuesday.
Health care and social protection are also inadequate for a growing elderly population, raising the risk that the demographic advantage could become an economic burden.
The report, Demographic Change in South Asia: From Tailwinds to Headwinds for Development, says Bangladesh has about two decades to capitalize on the opportunity.
South Asia’s working-age population is expected to peak and begin declining within a decade. By 2049, the region will become an ageing economy, with 14 percent of its population aged 65 or older. Bangladesh is expected to reach that stage by 2051.
Growth in the working-age population has added an average 0.4 percentage point to South Asian GDP growth each year since 2000, while labor productivity rose 1.1 percent annually.
Between 2000 and 2050, however, the demographic contribution to annual GDP growth is expected to fall to 0.1 percentage point.
World Bank Vice President for South Asia Johannes Zutt said governments must create better jobs, invest in young people and prepare for the needs of older populations.
For Bangladesh, the bank identified weak job creation as a major barrier. Limited formal employment, low female participation and skill shortages are constraining progress.
About 84 percent of Bangladeshi workers, or 58 million people, are employed informally. Even among university graduates, 44 percent work in informal jobs.
World Bank Country Director for Bangladesh and Bhutan Jean Pesme said institutions need support to create quality jobs, young people need market-relevant skills and barriers to women’s employment must be removed.
Bangladesh must also strengthen health care and retirement income for older people and increase domestic revenue, Pesme said.
Across South Asia, only 17 percent of workers contribute to a pension system and only 10 percent of older people receive pension benefits, among the world’s lowest coverage rates.
The World Bank recommended a two-track approach: expand productive jobs, finance for small and medium enterprises, simpler business rules, skills and women’s employment; and improve health care, long-term care and pensions for older people.
Without timely reforms to employment and social protection, South Asia will struggle to preserve the benefits of its changing population structure, the report said.
বাংলায় মূল প্রতিবেদন পড়ুন · Read the original Bengali report