December 12, 2024
DHAKA – The past government had been relying on international definitions and standards that are over four decades old to measure labour data, painting a rosy picture of low unemployment and an improved labour market.
While the numbers produced by the state-run statistics bureau data may have conferred a favourable global ranking, experts warn that it undermines Bangladesh’s overall planning and job creation efforts.
Ignoring global standards, the Bangladesh Bureau of Statistics (BBS) is still using the 13th International Conference of Labour Statisticians (ICLS) of 1982, rather than the latest 19th version from 2013.
The ICLS is a global standard-setting body for labour statistics, hosted by the International Labour Organization (ILO) every five years.
Most countries now use the 19th ICLS, which provides more accurate and up-to-date figures.
For instance, according to the final report of the Labour Force Survey 2022, unemployment in Bangladesh stood at 3.5 percent, or 25.8 million people, based on the 13th ICLS.
But using the 19th ICLS definition, the unemployment rate would rise to 5.9 percent.
Besides, the youth unemployment rate would rise from 8 percent to 17.7 percent if the latest standards are adopted.
The BBS also uses a different age range for youth and the working-age population than international standards.
A BROADER DEFINITION TO DOWNPLAY UNEMPLOYMENT
The definition used by the Bangladesh statistical agency produces a lower unemployment rate, according to a recently published white paper on the state of Bangladesh’s economy.
This is because the 13th ICLS has a broader definition of employment.
For example, individuals engaged in the production of goods for their own final consumption are classified as employed under the 13th ICLS definition.
However, they are excluded from the employment definition in the 19th ICLS resolution and instead categorised as engaging in “own-use production work”, separate from “employment work”.
“These discrepancies in standards and definitions have enabled the BBS to report an inflated employment rate for years, thereby downplaying the extent of the unemployment issue in the country,” the paper said.
According to the paper, the reliance on outdated standards distorts the actual representation of labour and employment conditions, affecting several key indicators, including the labour force participation rate, employment rate, unemployment rate, youth unemployment, youth not in employment, education, or training (NEET) and informal employment.
“Some countries still use the 13th ICLS, but most of those countries do not have a population size like Bangladesh,” said Tuomo Poutiainen, ILO country director for Bangladesh.
“Because Bangladesh’ population size affects regional and sub-regional numbers and averages,” he told The Daily Star.
The ILO country director said the International Labour Organization encourages the use of the 19th ICLS and is already providing technical support to the BBS to adopt it.
Not only the 19th, but the latest ICLS, the 21st, held in Geneva in 2023, focused on informal sector and informal economy data, he added.
“We encourage the BBS to also start adopting some of those relevant definitions,” he said.
IGNORING THE UPDATE MAY LEAD TO WRONG POLICIES
Admitting the use of old data in labour force surveys, the statistics bureau said it needs time to adopt new standards.
However, experts called for the agency to shift to new standards as soon as possible.
Sayema Haque Bidisha, a professor of economics at the University of Dhaka, said the BBS should adopt the updated definition to portray the real picture. “If we ignore the updated definition, it will lead to wrong policymaking decisions.”
Bidisha, also pro-vice-chancellor of Dhaka University, suggested the BBS calculate backdated data using updated definition to avoid providing misleading information.
Echoing similar sentiments, Rizwanul Islam, a former special adviser for employment at the ILO in Geneva, called for the adoption of the updated definition while maintaining data consistency.
The white paper said the 19th ICLS method makes more sense from a policymaking perspective and the BBS should follow it in the future.
Towfiqul Islam Khan, a senior research fellow at the Centre for Policy Dialogue (CPD), said, “BBS labour data is useless in terms of policy making. It doesn’t reflect the real picture of the market.”
He, however, expressed optimism about the BBS’s step to adopt some of the 19th ICLS standards following the publication of the white paper.
“We need elaborate data on previous years, which will guide proper policy-making decisions,” Khan said.
Mohammed Mizanur Rahman, director general of the BBS, said they have already inserted a new chapter in the latest final report of the LFS 2023.
Rahman said, “We have started to move to new standards gradually. It will require some time.”
In reply to a query about whether the outdated definitions were employed as a political favour to the past government, he said: “We had no intention to provide any political benefits to any party. Besides, we had the ILO monitoring our previous labour data publication.”
However, Selim Raihan, executive director of the South Asian Network on Economic Modeling and also a member of the white paper panel, believes there were political pressures on BBS to show positive labour market indicators.
“This might have pressured the bureau to refrain from adopting the latest definitions so that it reflects a positive picture,” he told The Daily Star.