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Structure of labour demand of the host countries to be changed as they are experiencing demographic shifts: Mustafizur Rahman

Published in The Financial Express on Saturday, 7 May 2016

Post-editorial

Challenges facing manpower export

Rahman Jahangir

Remittance earned by Bangladeshi expatriate workers is one of the two strongest pillars of the country’s economy, the other being readymade garment exports. That is why the economy is bound to be shaken if any of the two faces jolts due to adverse external development. While displacement of workers due to severe economic crisis in the host countries will seriously affect Bangladesh, it is now proper time for the government to design well-thought-out strategies to meet the challenges before its fallout leaves a pall of gloom on the country.

Saudi Labour Minister Mufrej al-Haqbani’s disclosure on Tuesday last of the Kingdom’s new set of labour quotas and incentives to reduce Saudi unemployment as it tries to wean its  economy  off oil exports has to be taken note of by Bangladesh with due importance.

The ensuing changes are part of a wider reform plan  announced by Saudi Deputy Crown  Prince Mohamed bin Salman and reflect the difficulties the Kingdom has faced for years in  creating jobs for Saudi nationals. He was  referring to the possibility of restricting certain jobs to Saudis and pressing companies to  employ higher ratios of Saudis to foreign workers.

Cutting  the  jobless  rate  to 7.0 per cent by  2030,  and raising   women’s participation in  the  labour force to 30 per cent from  22 per cent,  are among  a raft of targets in Prince Mohamed’s reform plan.  Under    a    government    programme called Nitaquat (Categories), launched in 2011, companies are already encouraged to hire Saudis  rather  than  cheaper foreign  workers.  Firms  employing more Saudis receive preferential  treatment  from  the Labour Ministry in   processing work permits.

Similar squeeze in hiring overseas workers is discernible in other member-states of the Gulf Cooperation Council (GCC). Incidentally, Saudi Arabia is the highest employer of Bangladeshi manpower. It is against this backdrop that Bangladesh’s prospects of more manpower exports to traditional countries of the Gulf Cooperation Council have become almost dim as drastic fall in oil prices has shaken these countries so much so that they are not keen on any more intake.

These countries are even thinking of reducing manpower imports by encouraging their own citizens to take up those jobs. And the fact remains that about 87 per cent of Bangladesh’s  migrants did not receive any training prior to their departure. The government, in view of the situation, needs to recast its manpower export strategy giving more thrust to imparting skills to the foreign job-seekers.

Experts have already urged the government to equip aspirant migrant workers with the right set of skills and languages before they depart for jobs so that they can earn more and avoid exploitation. As many of the host countries start to experience demographic shifts, the structure of their labour demand is expected to undergo important changes, said Prof Mustafizur Rahman, executive director of CPD, in a presentation. “This has important implications for the development of needed skills and catering to the emerging demand for financial inclusion.”

For example, skilled Filipino migrant workers  send home four times more in remittance compared to Bangladeshi workers. Sri Lankan workers earn up to 70 per cent more than their Bangladeshi counterparts because of their skills and fluency in English.

It is against this backdrop that Bangladesh needs to go for accelerating vocational education at SSC and HSC levels and collaborating with worker-receiving countries so they can be trained according to their specifications. Extensive skills training programmes can help Bangladesh gain demographic dividends with more remittances from Western and industrialised Asian countries. The ever shrinking young and productive workforce in Europe, Japan and South Korea has given huge opportunities to skilled Bangladeshi workers.

Latest reports say, the working-age population of Germany – Europe’s biggest economy – is expected to shrink by 6.3 million by 2030 as the country’s overall population dwindles from 82 million to 65-70 million by 2060. Policymakers are warning of a looming shortage of skills that the Cologne-based IW institute has estimated is already costing 22 billion euros ($27 billion) a year. There is a particular deficit of workers with adequate qualifications in maths, computing, science and technology.

During a speech in Belgium, European Commission (EC) Digital Single Market chief Andrus Ansip said Europe might face a huge deficit in skilled ICT workers. “Despite rapid growth in the ICT sector, creating some 120,000 new jobs a year, Europe could face a shortage of more than 800,000 skilled ICT workers by 2020”, he said. “We still see big differences in skills levels between EU countries, and different implementation of national skills programmes designed to minimize Europe’s digital divide”.

Even South Korea’s economic growth has slowed along with the formerly explosive development of the dominant manufacturing sector, and the government will need to consider ways to attract skilled foreigners as it seeks to boost the competitiveness of the services sector, said Kwon Young-sun, an economist. “If Korea wants to upgrade its services sector like Singapore did, we may need highly educated, highly skilled foreign workers,” he said. Japan too is facing an acute shortage of skilled workforce.

Happily, the issue of migration is now more focused in the 7th Five-Year Plan of Bangladesh. It has been identified as a driver for growth and poverty reduction, and as a potential factor to boost the economic development of those regions of Bangladesh that are lagging behind. But then real progress is badly needed in executing the plan’s objective.

It is time that Bangladesh undertook and implemented a comprehensive skills development policy after making a survey of what is actually needed in host countries.

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