Bangladesh – Labour Market Profile 2014

Bangladesh
Labour Market Profile
2014
This Labour Market Profile is a yearly updated report that provides a broad overview of the labour
market's situation and development. The report is based on the latest data available and following
trends. Each section has also accesses to the sources' links that can be used to go more in-depth on
selected themes.
1
Bangladesh – Labour Market Profile 2014
Executive Summary
Bangladesh is a poor country, but is achieving a
remarkable economic growth and a noteworthy
decrease of working poor. The informal economy has
been an important component of the growth
dynamics, which has increased and reached 89% of
the total number of jobs in the labour market.
wages, and more remittances is likely a contributing
force in Bangladesh’s remarkable record of poverty
reduction. The country’s four million garment workers
received a wage rise to US$68 in November 2013, an
increase of 64%, after protests and strikes in the crisishit industry. Moreover, European retailers promised to
sign an accord to improve safety conditions in
factories after the Rana Plaza collapse on April 24,
2013. The government, the European Union (EU) and
the ILO launched a Global Sustainability Compact to
improve labour rights, working conditions and factor
safety in the garment industry. Unlike in previous
years, the Ministry of Labour and Employment (MoLE)
has now formally investigated complaints of unfair
union discrimination.
The trade union movement is split along party lines
and political leanings. It has been estimated that trade
union members share of labour force is 3%, while it is
22% among waged workers. Strikes and labour actions
are common and frequently spontaneous. They often
turn violent and policy crack-downs also happen.
The Labour Act was amended in July 2013. Several
provisions to improve workplace safety have been
included in the law. There have also been some
improvements in terms of Freedom of Association and
Collective Bargaining. However, both trade unions and
the International Labour Organization (ILO) have
raised concerns in issues that were excluded by the
amendments. In addition, the labour laws are not fully
enforced. It is to some extent not merely a question of
a lack of capacity issues, but also reflects a deeprooted anti-union bias. The latter is in part due to the
influence that the garment industry has over the
government. Recently, there has been some progress
by the Government in registering enterprise-level
trade unions, which did not require an amendment of
the labour law.
Few contributory social protection schemes exist, and
most forms of social protection are through noncontributory social assistance. The health social
protection coverage is only 1.4% of the population
while the proportion of pensionable age receiving an
old age pension is 40%.
Occupational safety and health standards in the
mostly labour intensive jobs are appalling. Particular
dangerous jobs are the construction, where workers
often migrate around the country for jobs; tanning in
toxic environments; ship-breaking done by hand and
the readymade garment sector with high fire hazards.
The number of students in vocational training has
steadily increased over the last decade. Bangladesh
has a better educated population than many
neighbouring countries and high enrolment rates for
girls. The industries, however, mostly use unskilled
labour, hampering knowledge spill over and
entrepreneurship. Social mobility is still low and the
poor children and teenagers’ do not have any access
to the vocational training and even many of the child
labours do not access primary schooling.
In July 2014, the government approved, in principle,
the draft of the Bangladesh Export Processing Zone
(EPZ) Labour Law to ensure the welfare of the EPZ
workers by allowing them in constitution of
organizations. Trade unions are concerned, though,
that the law does not ensure the rights of trade union
in EPZ while the Welfare Committee has authority to
bargain.
Bangladesh has a trend of rising wages. The
combination of increasing job opportunities, higher
2
Contents
Trade Unions (Updating by SRO) ............................................................................................................. 4
Trade Unions in Bangladesh .......................................................................................................................... 5
Employers’ Organisations ....................................................................................................................... 6
Central Tripartite Structures (Update by SRO) ......................................................................................... 6
National Labour Legislation (Update by SRO) .......................................................................................... 7
ILO Conventions ..................................................................................................................................... 8
Trade Union Rights Violations ................................................................................................................ 9
Working Conditions.............................................................................................................................. 10
Workforce ........................................................................................................................................... 12
Unemployment and underemployment ..................................................................................................... 12
Sectoral employment .................................................................................................................................. 13
Migration ..................................................................................................................................................... 14
Informal Economy ....................................................................................................................................... 14
Child Labour ................................................................................................................................................. 15
Gender ......................................................................................................................................................... 15
Youth ........................................................................................................................................................... 16
Characteristics of the Working Age Population ..................................................................................... 17
Social Protection .................................................................................................................................. 19
General Economic Performance ............................................................................................................ 20
Trade ................................................................................................................................................... 21
Trade agreements ....................................................................................................................................... 21
Export Processing Zones .............................................................................................................................. 21
References ........................................................................................................................................... 22
3
Trade Unions
Legally registered unions are entitled to bargain
collectively with employers; but, this rarely occurs.
Labor organizations have reported that in some
companies workers do not exercise their collective
bargaining rights due to their unions’ ability to address
grievances with management informally or due to fear
7
of reprisal.
Trade unions in Bangladesh
(2014)
Number of trade national union centres
Number of sectoral trade union federation
Number of basic unions
32
169
7,289
Dues (median)
N/A
Members of trade unions
2.3 million
Trade union members share of labour force
3%
Sramik Karmachari Oikya Parishad (SKOP)
Trade union members to waged workers
23 %
Female member share of trade unions
15 %
Affiliated trade unions from the informal
economy
N/A
Number of CBAs
N/A
The SKOP is an alliance of the National Federation of
Trade Unions established in the early 1980s when the
military government of Bangladesh banned all trade
union activities in the country. SKOP is the platform of
joint action on national issues concerning labour
market and trade unions, in which 22 out of 32
national trade union centres are affiliated. It was
established in 1983 as a joint forum for the
mainstream trade union centres to coordinate
demands for restoring workers’ rights during a time
when the country was under martial law. SKOP
launched several strikes in the following years. Today
SKOP represents 16 national centres and functions as
a national coordinator, issuing common trade union
stances on specific topics.
1
Workers covered by CBAs (2006) (wage &
salaried earners)
5.0 %
Share of workers covered by CBA (2006)
1.1 %
2
77,624,000
Labour force (2013)
The trade union movement is fragmented into more
than 32 trade national union centres or federations
3
with links to the rivalling political parties. Unions are
highly politicized, but independent of the government;
and strongest in state-owned enterprises.
Although the government hardly prioritize workers’
rights issues over the issue of industrial peace and
global competitiveness, the SKOP has given
opportunities for its affiliated unions to force the
government and the employers to listen the ‘voices’ of
the workers—both organized and unorganized.
Union density is estimated as 23% of waged workers.
The rate is higher in the public sector of Bangladesh.
Besides, there are numbers of trade unions in private
formal sector. The reason for majority of the trade
unions being in the public sector is because due to the
negligence of private factory owners, most of the
funding of the trade unions comes from regional
branches of the political parties.
The Bangladesh Institute of Labour Studies (BILS)
BILS was established in 1995 with the support and
active participation of 13 National Trade Union
Federations. The organization is the only labour
research institution of Bangladesh. It develops the
capacity of the trade union movement and brings
trade unions with different political views together in
concrete co-operation for i.e. formulation of policy
development, inputs and recommendations.
Trade union rights are not adequately protected in
law. While the Constitution provides for freedom of
association, when registering, unions must represent
an inordinate 30% of the workers in an enterprise and
4
must obtain authorization from the government.
The prominent and labour intensive readymade
garment industry has many industrial conflicts. The
industry only has around 63,000 unionised workers
5
out of 3.5 million, mostly young women. ILO Country
Director stated in a meeting with the Department of
Labour (DoL) in February 2014 that union registrations
rise sharply in Bangladesh garment sector.
As a joint institution for the labour movement BILS has
as such no direct relation with the political parties in
Bangladesh and has a democratic constitution with
regularly free elections for offices at all levels. Policy
recommendations based on BILS research are being
brought forward to SKOP, which enters into
negotiation with government and political parties.
The government denies domestic workers the right to
6
form their own trade unions.
4
The national centres organize approximately 2.3
million workers out of a total workforce of 78 million
people. They mainly organize workers within the
formal sector, though some have started organizing
workers from the informal economy like construction,
rice processing, ship breaking, among others.
The 14 major national trade union centres are the
associate members of BILS. Beyond the associate
organisation BILS has 435 individual support members.
The 14 organisations are:













Aiming to achieve better result in employersemployees relationship, BILS plays an important role
to strengthen the tripartite mechanism between the
government, employers and employees, in association
with a wide range of other national and international
institutions, e.g. ILO.
BILS regularly organize meetings and dialogues
amongst not only the member unions but beyond.
BILS research inputs such as on minimum wage in
garment, shrimp processing, construction and rice
processing sectors, on labour law reform, decent work
had been in widely use by the trade unions and SKOP
in their policy advocacy and workers’ awareness
programs.
Trade Unions in Bangladesh
JSFB: Jatiya Sramik Federation Bangladesh
JSF: Jatiya Sramik Federation
BSSF: Bangladesh Sangjukta Sramik Federation
JSL: Jatiya Sramik League
BJSD: Bangladesh Jatiyatabadi Sramik Dal
BTUK: Bangladesh Trade Union Kendra
BFTUC: Bangladesh Free Trade Union Congress
BLF: Bangladesh Labour Federation
BMSF: Bangladesh Mukto Sramik Federation
JSJ: Jatiya Sramik Jote
BSF: Bangladesh Sramik Federation
BJSF: Bangladesh Jatiya Sramik Federation
BJSJ: Bangladesh Jatiya Sramik Jote
8
Members, Dues, Collective Bargaining Agreements (CBA) and Occupational Safety and Health committees
Trade Union Centre
BFTUC Bangladesh Free Trade Union
Congress
BJSD Bangladesh Jatyatabadi Sramik Dal
BJSF Bangladesh Jatiya Sramik Federation
BJSJ Bangladesh Jatiya Sramik Jote
BLF Bangladesh Labour Federation
BMSF Bangladesh Mukto Sramik
Federation
BSF Bangladesh Sramik Federation
BSSF Bangladesh Sanjukta Sramik
Federation
BTUK Bangladesh Trade Union Kendra
JSF Jatiya Sramik Federation
JSFB Jatiyo Sramik Federation Bangladesh
JSJ Jatiyo Sramik Jote
JSL Jatiyo Sramik League
BTUF the Bangladesh Trade Union
Federation
BTUS Bangladesh Trade Union Sangha
JSJB Jatiya Sramik Jote Bangladesh
JSP Jatiya Sramik Party
NTUF the National Trade Union Federation
NWF the National Workers' Federation
SSF Samajtantrik Sramik Front
TUK the Bangladesh Trade Union Kendra
Dues
Number
of CBAs
Workers
covered
by CBAs
Number of
OSH committees at
workplaces
21.3 %
-
-
-
-
180,000
10,050
82,000
102,000
14.5 %
12.4 %
42.7 %
19.6 %
-
-
-
-
BILS
204,000
31.7 %
-
-
-
-
BILS
5,989
9.9 %
-
-
-
-
BILS
155,000
2.0 %
-
-
-
-
BILS
BILS
BILS
BILS
BILS
80,970
38,000
15,881
2,260
150,000
11.1 %
32.9 %
5.0 %
4.4 %
4.7 %
-
-
-
-
-
1,648
-
-
-
-
-
-
150,000
65,000
110,000
1,798
10,467
2,285
50,180
0.2 %
10.0 %
22.7 %
5.9 %
-
-
-
-
-
National
affiliation
Total
Members
(2012)
Female
Members
BILS
85,000
BILS
BILS
BILS
BILS
5
Employers’ Organisations
Bangladesh Employers’ Federation (BEF)
9
BEF was founded in 1998 and is the national employer
organization, representing 131 affiliates with around
90% of established employers in the private sector.
BEF is represented in most national bi- or tripartite
bodies. BEF is headed by Mr. Tapan Chowdhury during
2013-2014.
In the organization, the garment sector has two very
active employers’ organisations, the Bangladesh
Garment Manufacture and Exporters Association
(BGMEA) and the Bangladesh Knitwear Manufactures
& Exporters Association (BKMEA)
The Federation is also represented on the Council of
International Organization of Employers and through
it, maintains close touch with employers’
organizations in other countries and exchanges views
and information on current issues.
BEF provides advisory services on industrial relations,
productivity improvement assistance, training, labour
court assistance,
minimum
wages
board
representation and inputs to national policy issues.
Central Tripartite Structures
Mediation and Arbitration
appointed by the Government. The Board gives
recommendation to changes in the minimum wage,
which the government can either accept or send back
to review in the Board. The board must meet every
five year.
Collective industrial disputes are governed by the
Labour Law. First the parties have to go through a
settlement overseen by a Conciliator. If settlement
fails the parties may be refer the dispute to an
Arbitrator, or either party may instead conduct strike
or lockout or apply for the Labour Court to adjudicate
the dispute. The Labour Court consists of a Chairman
appointed by the Government and one member each
representing employers and workers.
Wage board covering traditional unorganised sectors
has been established in shrimp processing, metal and
construction after pressure from trade union forums
National Council for Industrial Health and Safety
10
According to ITUC, the system of labour justice in
Bangladesh is slow, sometimes cases have to stay for
years in the backlog, and courts usually fail to provide
remedy for labour abuses.
The Government may establish the National Council
for Industrial Health and Safety. It consists of seven
ministers, seven representatives from industries and
seven workers representatives. The Council prepares
national policy on Occupational Safety and Health.
Minimum Wage Board
Other bi/tripartite organs
The Government must establish a wage board
consisting of a Chairman, an independent member and
a representative each from workers and employers, all
-
6
National Coordination Committee for Workers’
Education (NCCWE)
National Labour Legislation
Constitution
11
provided to employers. In the public industrial sector,
workers are allowed to elect 10% of their enterprise
officers from outside the workplace, although this
right is not extended to workers in the private sector.
Bangladesh constitution is from 1972, and has been
amended 15 times since then. The Constitution
prohibits forced labour and gives the right to form
associations or unions, to reasonable wages, to social
security and equal opportunity in employment. Work
is a right and duty, and local government are
encouraged to institute representation of workers.
However, both the Bangladesh's trade union
movement and ILO have raised concerns in issues that
14
were excluded by the amendments. Among others,
30% of the enterprises workforce still must vote for
the establishment of a union as well as it did not
extend freedom of association and collective
bargaining rights to workers in export processing
zones. It has also been observed that some new
provisions of the law, for example with respect of
rights of workers who are contracted for services and
new exclusions from coverage of the labor law of
certain sectors, may raise additional concerns about
conformity with ratified conventions.
12
Labour Act
The Labour Act of 2006 consolidated 25 separate acts
into one labour code. It regulates employment
relations, working hours, wages, trade unions and
industrial relations. It sets maternity benefits,
compensations for injury and accidents, Occupational
Safety and Health Standards, the labour inspectorate
and prohibits child labour. It also establishes the Wage
Board, the Labour Court, the National Council for
Industrial Health and Safety, the procedures for
industrial disputes including strikes and lockouts.
15
Overseas Employment and Migration Act
The Overseas Employment and Migration Act from
2013
promotes
opportunities
for
overseas
employment and to establish a safe and fair system of
migration, to ensure rights and welfare of migrant
workers and members of their families.
In response to the demand of national trade unions
movement as well as international pressure,
Bangladesh’s Government amended the Labour Act in
13
July 2013. Several provisions to improve workplace
safety have been included in the law. There has also
been some improvements in terms of Freedom of
Association and Collective Bargaining, e.g. allow
workers to call on outside experts for advice during
collective bargaining and there is no longer a
requirement that the names of union leaders are
The Labour Act is the most important labour
legislation. Several other legislations exists which
regulates and sets standards and restrictions for the
16
labour market.
7
ILO Conventions
Ratified ILO Conventions17
Subject and/or right
Ratification
date
Convention
Fundamental Conventions
Freedom of association and
collective bargaining
Elimination of all forms of
forced labour
Effective abolition of child
labour
Elimination of discrimination
in employment
C087 - Freedom of Association and Protection of the Right to Organise, 1948
C098 - Right to Organise and Collective Bargaining Convention, 1949
C029 - Forced Labour Convention, 1930
C105 - Abolition of Forced Labour Convention, 1957
C138 - Minimum Age Convention, 1973
C182 - Worst Forms of Child Labour Convention, 1999
C100 - Equal Remuneration Convention, 1951
C111 - Discrimination (Employment and Occupation) Convention, 1958
1972
1972
1972
1972
Not ratified
2001
1998
1972
C081 - Labour Inspection Convention, 1947
C129 - Labour Inspection (Agriculture) Convention, 1969
C122 - Employment Policy Convention, 1964
C144 - Tripartite Consultation (International Labour Standards) Convention, 1976
1972
Not ratified
Not ratified
1979
Governance Conventions
Labour inspection
Employment policy
Tripartism
Up-to-date Conventions
Working time
C014 - Weekly Rest (Industry) Convention, 1921
C106 - Weekly Rest (Commerce and Offices) Convention, 1957
1972
1972
Social Security
C118 - Equality of Treatment (Social Security) Convention, 1962
1972
Specific categories of workers
C149 - Nursing Personnel Convention, 1977
1972
Seafarers
C185 - Seafarers' Identity Documents Convention, 2003
2014
Fundamental Conventions are the eight most important ILO conventions that cover four fundamental principles and rights at work. Equivalent to
basic human rights at work.
Governance Conventions are four conventions that the ILO has designated as important to building national institutions and capacities that serve to
promote employment. In other words, conventions that promotes a well-regulated and well-functioning labour market.
In addition, there are 71 conventions, which ILO considers “up-to-date" and actively promotes.
8
Trade Union Rights Violations
The International Trade Union Confederation (ITUC)
has surveyed some cases of violations of trade union
rights in the period 2013-2014 (October): i) There
were police attacks against protesters in August 2014
and workers were hindered from getting to their
factory where they had been on an indefinite hunger
strike for 11 days demanding their overdue wages and
Eid bonus. ii) There was policy brutality in November
2013 when workers protested against employers’
refusal to pay higher minimum wages and the rate
announced by Minimum Wage Board. Police fired water
cannon and rubber bullets to break protests injuring
more than 50 people. About 250 factories were shut
down in the Ashulia industrial zone on the outskirts of
the capital Dhaka.
statements stating they would terminate their union
were also noted.
BILS registered 797 incidents of inhuman torture on
domestic workers took place in the last 10 years. Of
those, 398 died of torture, 299 were wounded and
21
100 others faced other forms of torture.
Compliance and enforcement of labour laws have
been insufficient, and companies are often
discouraging the formation of labour unions.
Although the government has approved the
Bangladesh Export Processing Zone (EPZ) Labour Law,
2014, with a claim that it will ensure the rights of trade
union in EPZ, different labour rights groups have
alleged that still no fundamental change have been
brought to the law and it has not ensured freedom of
association and the right to form trade union.
On 24 April, 2013, the Rana Plaza building in Dhaka
burned down and more than 1,100 workers were
killed and thousands more injured. It demonstrated
not only the high risks of unacceptable working
conditions workers operate in, but also the battle for
18
full and fair compensation continues.
ILO has no active case with Bangladesh in the
Committee of Freedom of Association. The follow-up
case is from 2010 by the Bangladesh Cha-Sramik Union
(BCSU) alleging interference by the authorities in the
election of officers to its Central Executive Committee,
as well as the violent suppression of demonstrations
organized to protest this interference. The election of
the BCSU Central Executive Committee was
implemented in August 2014 and the amended
constitution has also been approved. ILO's Committee
of Freedom of Association requested the Government
and BCSU in June 2014 to be kept informed on the
case.
Generally the labour market has been marred by
workers’ rights violation, e.g. police attack and injuring
during demonstrations actions, anti-union campaigns
by employers as well as violence and interferences in
19
collective bargaining.
The U.S. Country Reports on Human Rights Practices
20
also registered several cases: i) Between January
and September 2013, employers terminated 1,405
garment workers for demanding increased wages; ii) it
law enforcement officials confronted factory workers
in the garment industry who held protests to demand
increased wages; iii) labor organizers reported acts of
intimidation and abuse, the firing of employees, and
increased scrutiny by security forces and the NSI.
Employers harassment and threaten union members
with physical violence, forcing union members to sign
22
ILO Complaints Procedure
Freedom of Association cases (2013)
9
Active
Follow-up
0
1
Closed
14
Working Conditions
estimated, though, that nearly 40% of garment
factories in the Bangladesh capital are failing to pay a
28
new minimum wage. The trade unions have assessed
that 7,000 taka (US$84) is a minimum that can be
29
considered as a living wage , while the national
poverty income level is measured to be 1,487 taka
30
(US$18). There was no mechanism to keep the
minimum wage in line with inflation.
Wages and earnings
Monthly average, median and legal minimum wages
Source
Average wage
(2010)
Minimum wage
Garment sector (2013)
Minimum wage
Not covered by
industry
Minimum wage for a
19-year old worker or
an apprentice (2014)
Ratio of minimum
wage to value added
per worker (2014)
Real wage growth
(Average 2006-2010)
Growth of real
minimum wage
(Average 2006-2011)
Global Wage
Database23
U.S. Human
Rights Report24
Taka
US$
2,553
42
5,128
66
1,500
19
2,596
34
Minimum wages in the Export Processing Zones are
31
between 2,700-7,600 taka (US$34-US$96), slightly
higher than the national minimum wages.
Doing
Business25
0.36
The average wage continues to be lower than the
minimum wage for garment workers, and US$42 is a
low monthly wage in international comparison.
Minimum wages are also too low to meet the living
cost.
3.1 %
Global Wage
Database
17 %
The average value added per worker is the ratio of an economy’s
gross national income per capita to the working-age population as
a percentage of the total population.
Since 2005 both males and females’ rural real wages
have improved significantly with an annual growth
rate of 10%. In this sector the rate of growth in female
real wages has overtaken the rates of men; thus,
narrowing the male-to-female wage gap from 1.57 in
2005 to 1.37 in 2010. In the urban areas men and
females’ real wage growth rate increased from 2005
32
to 2010 on 10% and 3%, respectively.
Formal and informal monthly wages and earnings
26
From Wage Survey 2007
2007 Taka / 2011 US Dollar
Formal wages
Male
Female
Both
Informal earnings
Male
Female
Both
Median
Average
Tk 3,500 / US$ 55
Tk 2,400 / US$ 38
Tk 3,200 / US$ 50
Tk 3,906 / US$ 62
Tk 2,781 / US$ 44
Tk 3,766 / US$ 59
Tk 3,390 / US$ 53
Tk 1,826 / US$ 29
Tk 3,130 / US$ 49
Tk 3,573 / US$ 56
Tk 2,374 / US$ 37
Tk 3,417 / US$ 54
On average, wages from the informal economy are 8%
lower than wages in the formal sector; and in the
former, women’s wages are only two-thirds of men’s
earnings.
By law, the average should not exceed 56 hours.
Workers in factories receive one day off every week
while shop workers have 1½ days off per week. These
legal rules are often not followed, though; e.g. in the
garment sector workers can be required to work 12
hours a day and not always receive compensation for
their time.
Bangladesh has a trend of rising wages. The
combination of increasing job opportunities, higher
wages, and more remittances is likely a contributing
force in Bangladesh’s remarkable record of poverty
27
reduction over the past decade.
The authorities established the minimum monthly
wage at 1,500 taka (US$18.75) for all economic sectors
not covered by industry-specific wages. In principle,
The National Minimum Wage Board (NMWB) must at
least meet every five years in a tripartite forum to set
wage structures and benefits industry by industry. The
government agreed in November 2013 to raise the
minimum monthly wage for the country’s four million
garment workers to US$68, an increase of 64%, after
protests and strikes in the crisis-hit industry. It is
The rules of occupational health and safety standards
are routinely not enforced. Although workers can
invoke legal mechanisms to enforce the law, it has
only registered few cases. The labour market is
currently covered by only 91 inspectors nationwide,
which is equivalent to 1 per 836,000 workers in the
labour force. The ILO recommends 1 per 40,000
33
workers in less developed countries.
10
A technical team of the Accord on Fire and Building
Safety in Bangladesh was signed between IndustriALL,
UNI Global Union and more than 120 global garment
companies in January 2014 and finalized the standards
to be used for factory inspections. The Accord is
committed to inspect 1,500 factories by September
34
2014 for fire, electrical, and building safety.
garment, and ship recycling sectors are often singled
out with respect to low occupational safety and health
standards due the sectors growth and visibility, but it
is a problem in all sectors.
Human Rights Watch has documented toxic working
conditions in tanneries, invalidating workers and
37
polluting the environment.
Bangladesh also has a rising trend of precarious and
casual forms of employment. Wages of casual workers
35
are around two-fifth of regular workers. Working
hours are long for most workers, with 52% working
more than 48 hours per week. Because of the
competition of jobs due to high unemployment and
inadequate enforcement of labour laws, workers who
have complaint their working conditions risked losing
36
their jobs.
Safety conditions at many workplaces are extremely
poor. For example the prominent industry with
appalling occupation safety and health standards is
the ship breaking industry off the cost of Chittagong.
About half the world’s ships put out of commission are
stranded here and recycled. The process gives work to
around 200,000 workers and provides recycled
material. However, the work kills and injures
disproportionately many, as the scrapping is done with
simple hand tools and the ships often contains
hazardous materials, making it one of the most
38
dangerous industries in the world.
ILO’s Decent Work Country Programme also
recognises compliance with the labour law, the
minimum wage and occupational safety and health
standards as concerns. The construction, ready-made
11
Workforce
39
Employment rates
(2012), Age and Sex distribution
Sex
Male &
female
Male
Female
Employment
rate
Age
Total
Youth
Adult
Total
Youth
Adult
Total
Youth
Adult
15+
15-24
25+
15+
15-24
25+
15+
15-24
25+
68%
54%
73%
81%
61%
89%
54%
46%
58%
58
25+
89
73
46
15-24
61
54
54
15+
81
68
00
20
Female
Bangladesh has a total population of 157 million
people out of which the labour force covers 78 million
workers. Job creation is challenged by a steady labour
force growth of 2.2% during the last decade, meaning
1.7 million more entered the labour market in 2012. In
employment, women have lower employment rates
than men, both young and adults.
Bangladesh
South Asia
2005
51 %
80 %
2010
43 %
77 %
2005
38 %
73 %
2012
24 %
61 %
100
Unemployment, youth unemployment rate,
and underemployment42
Unemployment
(2013)
Youth
Unemployment
(2013)
Underemployment
(2010)43
Total
4.3 %
9.2 %
20.3 %
Male
3.9 %
9.0 %
14.4 %
Female
5.0 %
9.5 %
34.2 %
Underemployment is widespread. The labour force
survey from 2010 indicates that 20% are
underemployed, whereas other sources estimate as
many as 40%.
Share of workers
in total employment
2 US$ a day
80
Unemployment and underemployment
40
1.25 US$ a day
60
Male & female
13% lived for US$2-4 a day and 3% for US$4-20 in
2000. In 2010 19% lived for US$2-4 a day and 4.2% for
41
US$4-20. The dollars are in purchasing power parity.
The latest data on working poor from 2010 showed a
decrease of 4% in the moderately poor in employment
living with less than US$2 a day. The share remains
high on 77%, though. It remains much higher than the
average in South Asia, which reduced the moderate
working poor on 12% in the period 2005-2012.
Working Poor
40
Male
It is estimated that 4.3% of the labour force is in
unemployment, which is higher among youth with a
9.2% rate. There is a slight unemployment gap
favouring men in comparison with females. The
unemployment rate indicates the proportion of the
labour force that does not have a job and is actively
looking and available for work.
Working poor measures employed people living for less than
US$1.25 and US$2 a day, as proportion of total employment in that
group.
Main causes of unemployment in Bangladesh are
related to the rapidly increasing population growth
and the capacity to increase the resources for capital
formation; the backward method of agriculture; land
is very limited and with a heavy pressure of large
population; and the educational system is not job
oriented, but more degree oriented.
Asia has seen a strong growth in the middle class
during the last decade. Bangladesh has a smaller
middle class than the average for South Asia, but it has
grown faster: In South Asia 18% lived for US$2-4 a day
and 3.9% for US$4-20 in 1999, while in 2008 23% lived
for US$2-4 a day and 5.7% for US$4-20. In Bangladesh
12
Sectoral employment
44
45
Employment (2005) & GDP share (2012)
Sector & Sex distribution – (Graph without Agriculture)
Male
employment
Female
employment
GDP share
per sector
44,000
7,000
1.1 %
3,926,000
1,298,000
17.0 %
73,000
3,000
1.0 %
1,421,000
104,000
8.3 %
6,705,000
403,000
14.2 %
3,910,000
66,000
11.1 %
392,000
115,000
1.9 %
778,000
104,000
2.8 %
Other services
3,747,000
1,495,000
22.0 %
Agriculture
15,084,000
7,683,000
17.1 %
Sector
Mining and quarrying
ufacturing
Electricity, gas and water
Construction
Trade, restaurants and
hotels
Transport and
communication
Finance, real estate and
business services
Public administration,
education & health
Agriculture is a sector with a declining GDP share from
23% in 2002 to 17% in 2012. It is estimated that 48%
of the employed still work in agriculture, i.e. 15 million
men and 7.7 million women. It is noteworthy that the
informal economy is dominating agriculture, mining,
46
construction, and private households. Increasingly
random floods have decreased agricultural
production, affecting the many already impoverished
farmers, while at the same time food prices are
47
increasing.
0%
0
4%
Male
8%
12%
1.900.000 3.800.000 5.700.000
Female GDP share by Sector
16%
7.600.000
Policy Drafting Committee formed by the Ministry of
Labour and Employment. The policy has recognized
informal sector workers and aims to create ample
opportunity for the social protection and other rights
of them.
The majority of formal jobs are in semi- to high skilled
professions, whereas informal jobs are concentrated
among the 62% of jobs with low skills and low
productivity in common places of informal work such
48
as in farms, markets, bazaar stalls, and trade fairs.
Outside the agriculture sector, women largely find
work in other services and in the manufacturing
sector, which is almost only readymade garment
production. The garment exports are actually
the backbone of Bangladesh’s industrial
sector. The sector has remained resilient in
recent years amidst the previously mentioned
series of factory accidents
Sector Share (% of GDP)
49
60
50
40
30
20
The employment in the formal sector is to a large
degree covering the sectors: business & finance and
the public administration. The size of the public
administration employees is close to 2% of the worker
force.
10
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Agriculture
Due to the rising labor costs in China and India,
Bangladesh’s comparative advantage in laborintensive industries has seen a growth in
industrialisation. But, as previously mentioned, the
wages are also on a rise in Bangladesh.
The Government has adopted the National Labour
Policy 2012. BILS was an active member of the Labour
13
Services
Industry
Migration
Migration
50
Net migration
(2008-2012)
Net migration to
average population
per year (2008-2012)
Personal transfers
i.e. remittances
received, % of GDP
(2012)
Bangladesh
-2,040,559
Bangladesh
- 1 : 371
inhabitants
South Asia
- 1 : 1,135
Inhabitants
Bangladesh
12.1 %
South Asia
4.7 %
Remittances play a very important role in the
Bangladesh's economy: Around 12% of GDP is coming
from remittances. These are mainly used to purchase
consumptions goods, with few making it into
investment. The Government have therefore set up a
financial institution, the Probashi Kallyan Bank to
address this issue.
Factors leading to this large migration are
overpopulation, a large overseas diaspora, an
agricultural sector that is often unable to sustain the
livelihood. Diverse factors, which also lead to large
labour migration inside Bangladesh, give an almost
limitless supply of unskilled labour. The construction
sector in particular has many workers who migrate
from site to site.
Net migration is the net total of migrants during the period, that
is, the total number of immigrants less the annual number of
emigrants, including both citizens and noncitizens.
Bangladesh is one of the world’s countries with the
highest emigrants, with between 5–7 million migrants
abroad. The net migration rate is decreasing and has
reached 1 out 371 inhabitants in the period 2008-2012
comparison with 1 out of 250 in 2006-2010. It remains
much higher than in South Asia's average.
Bangladeshis migrate to very different countries, with
the top three destinations being India, Saudi Arabia,
51
and the United Kingdom.
Though remittances play a very important role for the
economy, unskilled women was banned from
migrating abroad until 2006, increasing unregulated
migration. Migration of unguarded women is still
52
frowned upon. Unregulated migrants are also at
53
higher risks of exploitation.
Informal Economy
The latest Economic Census 2013 shows that the
informal economy has been an important component
of the growth dynamics in Bangladesh. Findings reveal
that household based economic activities have
54
expanded tremendously over the last decade.
sector. With reference to the social protection
coverage, workers from the informal economy receive
less than formal workers.
The ISS has also shown that the labour productivity of
a typical worker in the informal enterprises is only
one-sixth (17%) of the productivity of their
counterpart in the formal sector. The main reasons for
engagement in informal activities are family traditional
56
(39%) and due to knowledge of the activity (37%).
The informal sector has been growing from 79% in
2002 which reached 89% of the total number of jobs in
the labour market, and accounts for 43% of GDP. It is
more prevalent in the rural areas than in the urban
areas. Women’s employment in the informal economy
has a higher incidence at 93% compared to males’ at
55
87%.
As the informal ‘sector’ is not covered by the Labour
Law, a very few unions operate in the informal
economy. However, a number of non-traditional
groups have started activities, including women in the
informal sector, within the WCL national affiliate,
Bangladesh Sanjukta Sramik Federation (BSSF).
Women’s organizations have set up cooperative
structures for their members and have taken a series
of initiatives, including in the areas of adult education,
mother and child care and productive work.
Data from the Informal Sector Survey (ISS) 2010
demonstrated a linkage between education level and
informal work, i.e. as the level of education of a
worker improved, the worker is more likely to hold a
formal job.
Workers from the informal economy receive on
average at least 35% lower wages than in the formal
14
Child Labour
Child labour is basically similar in rural (13%) and
urban areas (12%), whereas boys (20%) are much
more likely to be engaged in child labour than girls
61
(5%). Child labour is more common among the
poorest quintile of households (16%) than the richest
(8.2%).
Working children
Proportion of all children in age group
Region
Year
Type
Bangladesh
(age 5-17)57
2006
Child labourers
Asia and the
Pacific58
(age 5-17)
2008
Children in
employment
Child labourers
Hazardous work
Proportion
13 %
20.4 %
Poverty is the main reason for child labour in
Bangladesh, with poor households having to make
their children work, to sustain themselves. This, in
turn, increases the labour supply and likely keeps the
wages lower in the industries. It also decreases the
children’s future earnings due to lack of education and
their increased risk of occupational disability.
13.3 %
5.6 %
Children in employment includes all children who conduct some
kind of work, whereas child labourers is a narrower term
without mild forms of work. Hazardous work is the worst from
of child labour as defined in ILO C182.
Bangladesh is notorious for its child labour and more
than 5 million (13%) are child labourers, but in fact it is
about the same level as the average for Asia and the
Pacific average. Other estimations are around 7 million
child labourers (18%) with around 1.3 million in hazard
59
work (3.3%).
Child labour is popular among employers because
children are docile and submissive and above all either
not paid at all or very low paid. They can be tasked
with duties that adults would not undertake and as
they are free or very cheap labour they can perform
job functions with a very low margin of return on the
employer’s investment. On the other hand, children
often join small businesses as apprentices. They learn
a trade e.g. auto mechanic or electricians. It is often
the only option to get an education since the country
only has around 100 vocational training schools. The
apprentice system does on a positive note secure that
the children receive some kind of education but it also
keep them illiterate and poor as they get no salary for
years.
The child labour is common in services and the large
export textile industry. It is also more incompatible
60
with schooling.
According to the Labour Law 2006 no children below
the age of 14 are allowed to work and the types of
work adolescents between 14 and 18 can be engaged
in are specified. This group is not allowed to work with
anything dangerous or damaging. Certain types of
employment in certain industries such as heavy
industries are prohibited. Even then, a massive 86% of
all children aged 15-17 work in hazardous industries.
In 2005, 98% of recorded child labour was found to be
hazardous..
Based on the Parents Care Act from 2013 each of the
children will have to pay 10% of their total income
regularly to their parents if they do not live with their
parents. Overall, legal protections of child labour are
still insufficient and the capacity to enforce child labor
62
laws remains weak.
Gender
Bangladesh has made some progress on gender
equality. New legislation has been introduced,
including laws on violence against women, equal pay,
maternity leave, and parliamentary quotas. It is also
observed that the female literacy rate has increased.
But, the gender gaps remain in employment as well as
63
enforcement of the law is weak.
much lower for women, especially in the informal
sector. More girls also enrol in primary and secondary
education than boys; the latter is also four times more
likely to be engaged in child labour.
The readymade garment industry employs at around
80% women, and is the main employment option for
women outside agriculture. These women, at an
average age of 19, usually unmarried, and with little
education, are prone to exploitation, sexual
harassment, and discrimination. They earn 60% of
their male colleagues, and low occupational safety and
64
health standards. Around only 1.8% are members of
union.
As previously mentioned only about 15% of trade
union members are women. Women have
considerably lower rates of employment than men,
and have around double the rate of unemployment,
youth unemployment, and underemployment. Fewer
women are working poor, though. Wages are also
15
On the other hand, the industry has provided millions
of jobs, increased the women’s real earnings and more
economic freedom. It has also decreased fertility rate
and a study suggests that opening of a garment
factory within a village’s commuting distance,
65
increases schooling of girls in the village.
Females in management and ownership, 2013
67
40%
30%
20%
A recent Enterprise Survey from 2013 reported that
13% of firms had female participation in firm
ownership compared to the South Asia’s average of
17%; and that 16% of full time employees were
66
women, more than South Asia's 13%. It shows that
women in Bangladesh have a both lower ownership
participation and full time employment in comparison
with the Enterprise Survey from 2007.
10%
0%
Firms with female top manager
Bangladesh
Firms with female participation in
ownership
South Asia
Low income
Youth
The youth constitute one third of total population in
Bangladesh. The labour force on the age group 15-24
years old is 18.3 million youth with an unemployment
rate of 9.2%. The share of youth unemployment in
total unemployment is 50%. The unemployment rate
gap between male (3.9%) and female (5.0%) youth is
more or less equal and has been somewhat stable
since 1991.
subsume the youth into the general adult population
or to ignore their efforts to forge a livelihood through
enterprise activities. The potential benefits of youth
entrepreneurship as a means of improving youth
68
livelihoods remain unreached.
The Government published a National Youth Policy in
2003. The government suggested revisiting the youth
policy in 2010 to link it up with the political manifesto
69
of the Bangladesh Awami League party's Vision 2021.
It appears that the government has placed higher
attention on youth empowerment and increasing
finance on this area. On the other hand, the policy has
lacked concrete steps for achieving goals and its
implementation has been uncertain. Also a review and
70
revising of the policy have not been clear.
The youths of Bangladesh are confronting multifarious
problems that are rooted in social structure and
economic conditions, which fosters frustration among
youth.
Generally the government has not had a systematic
attempt to focus on youth. The tendency has been to
16
Characteristics of the Working Age Population
Highest level attained and years of schooling in the population
(2010), Population 25+, Total and Female
Highest Level Attained
Total
Female
No Schooling
Primary
42.0 %
1.4 %
21.4 %
12.2 %
18.5 %
1.6 %
2.8 %
46.6 %
1.5 %
21.0 %
10.9 %
16.1 %
1.3 %
2.5 %
4.8 years
4.3 years
Secondary
Tertiary
Begun
Completed
Begun
Completed
Begun
Completed
Average year of total schooling
Educational Gini Coefficient
0.52
71
Total
Female
0%
20%
40%
No Schooling
Secondary - Begun
Tertiary - Completed
0.56
60%
Primary - Begun
Secondary - Completed
80%
100%
Primary - Completed
Tertiary - Begun
Primary, secondary and tertiary is the internationally defined distinction of education. In Denmark these corresponds to grundskole, gymnasium &
university.
The educational Gini Coefficient is similar to the Gini Coefficient, but instead of measuring the distribution of income in a population, it measures
the distribution of education measured as years of schooling among the population. 72
Bangladesh has a high average years of schooling per
capita for South Asia, nevertheless over 40% of the
population have never been to school. Of those that
have education almost all have completed primary
school and many have progressed to secondary and
tertiary school.
Enrolment in Secondary and Tertiary schools (2000-2011)
Total and Female, Bangladesh and South Asia
Though women are underrepresented in almost all
types of education the gender difference in education
is rather small.
The graph above shows the educational attainment of
all Bangladeshis above 25 years, therefore gives a
glance of the human capital of the labour force.
73
Net secondary school enrolment
Gross tertiary school enrolment
60%
20%
50%
15%
40%
10%
30%
5%
20%
0%
Bangladesh , Total
enrolment
Bangladesh , Female
enrolment
South Asia , Total
enrolment
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
South Asia , Female
enrolment
Net enrolment is the ratio of children of official school age, who are enrolled in school to the population of the corresponding official school age.
Gross enrolment is the ratio of total enrolment, regardless of age, to the population of the corresponding official school age. Gross primary
enrolment is therefore sometimes higher than 100%.
Data from UNICEF suggests a net primary school
enrolment for boys at 83% and 93% for girls, which is
about the same for South Asia where total enrolment
is about 88%. Between 67% and 80% manage to
complete primary education. Primary education and
compulsory is free and compulsory until the age of 10,
but many children are drop out of school and work as
child labourers to help support the household.
Secondary school enrolment is also about the same
level as for South Asia, though it fell somewhat after
2003. Bangladesh also has a higher enrolment for girls,
which is uncommon.
Enrolment into tertiary schools is a little smaller than
the average for South Asia, but in expansion.
17
Vocational training
Vocational Training
74
Pupils in vocational training
(2012)
Ratio of pupils in vocational
training to all pupils in
secondary education
(Average 2008-2012)
Ratio of pupils in
vocational training out of
15-24 year olds.
Bangladesh
The number of vocational students has steadily
increased from 105,000 in 2000 to 429,000 in 2012.
The ratio of pupils in vocational training to all pupils in
secondary education is 3.4%, while the South Asia's
average is 1.2%. Overall, Bangladesh has a
considerable higher vocational training rate than the
average for South Asia.
428,459
Bangladesh
3.4 %
South Asia
1.2 %
Bangladesh
1.2 %
South Asia
0.5 %
Ratio of pupils in vocational training to all pupils in secondary
education in South Asia is based on an average during 2008-2009.
The ratio of the 15-24 year olds covers the period 2005-2015,
while in South Asia presents an average from 2005-2010.
Secondary education, vocational pupils
Still the country has only around 100 vocational
training schools, which make it difficult for most of the
poorer younger people to get vocational training.
Data from a survey from 2012 estimated that
approximately 80% of the workforce had not received
any training and among the 20% that had, only 11%
had received training which was classifiable under the
76
NTVQF. It was also registered that TVET institutions
under the Directorate of Technical Education (DTE) are
in crisis in terms of teachers, not only in numbers but
also in terms of their competence for delivering skills.
75
2000000
1500000
1000000
500000
0
2000 2011 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Bangladesh
South Asia
The government’s Technical Vocational Education and
Training (TVET) went through an overhaul in 2006. It
produced a National Skill Development Policy and a
National Technical Vocational Qualification Framework
(NTVQF). Traditionally vocational training has not had
a strong links to industry.
18
Social Protection
There are several non-contributory social assistance
programmes exists, mainly for women and girls, and
many are donor funded. These include payment of
school fees for girls, food programmes providing
wheat or rice to destitute women, income transfer for
public works, a poverty reduction programme through
training and transfers, a cash transfer programme
conditional on children’s school attendance and
82
marks.
Public spending on social protection schemes77
(2011)
Bangladesh Taka
131 billion
US$
1.8 billion
% of GDP
1.6 %
Public social protection
expenditure, excl. health
per capita
11.6 US$
% of government
expenditure
26 %
% of GDP
1.1 %
% of population
1.4 %
% changes per
year (2007-2011)
8.6 %
Public health care
Health social protection
coverage
Trends in government
expenditure in health
In addition, a publicly paid Old Age Allowance
programme exists for persons who had an annual
income less 3,000 taka per year (US$40), providing a
83
250 taka per month (US$3.4). It has 2 million
beneficiaries and covers 7% (US$81 million) of the
total social protection programs expenditures. The
system is valuable for the country’s vulnerable older
people, but also has weaknesses in the form of means
testing, low benefits and not effectively reaching its
target population due to abuse of power and
84
corruption.
Benefits, coverage and contributions to pension
78
schemes (2011)
Social benefits for the active age
% of GDP
0.5 %
Labour market programs
% of GDP
0.5 %
Proportion of
total
40 %
15-64 years
0%
Pensionable (65+; 62+ for OA
allowances for women) age
receiving an old age pension
Active contributors to an old age
pension scheme
The retirement pensions or benefits for government
employees and family members of retired persons
have currently 325,000 beneficiaries. It is less than 1%
of the total social protection beneficiaries. On the
other hand, it is the single largest expenditure of all
social protection programs covering 19% (US$227
million).
Few contributory social protection schemes exist in
Bangladesh, and most forms of social protection are
through non-contributory social assistance. The health
social protection coverage is only 1.4% of the
population while the proportion of pensionable age
receiving an old age pension is 40%.
There are five major labour market programs and they
cover 35% of the total social protection expenditure.
They have 10.2 million beneficiaries, which is a quite
large number of total social protection beneficiaries,
85
i.e. 36%.
Employers are required to provide a termination
benefit. Permanent employees receive half their
average wage for 120 days, causal workers for 60 days
79
and temporary workers for 60 days.
In 2012, the government has drafted a national social
protection strategy, which is yet to be finalized.
Employees in the formal sector are entitled to
disability and survivor benefits, for accidents in
employment. Employers bear the full cost.
Disagreements on compensation can be settled at the
80
Labour Court.
Although Informal sectors workers are not entitled for
any forms of social protection, in November 2013, the
government introduced a five-year group insurance
scheme for the construction workers. The annual
premium per worker has been set at Tk 1,300 out of
which each worker has to deposit Tk 450 and the
ministry Tk 850. BILS was actively involved in the
whole process of insurance.
There are national policies, which aim to provide social
security for all workers and employees in the form of
provident funds, gratuity and retirement pensions, for
the private and public sector. Formal sector workers
currently enjoy some social protection, but informal
sector workers and casual workers do not have access
81
to such benefits.
The government has supported occupational victim
workers from Labour Welfare Foundation. BILS had an
active involvement in the whole process.
19
General Economic Performance
86
The Doing Business indicator ranks Bangladesh as 173
out of 189 countries, which are three steps down since
2014. Protecting Minority Investors has the highest
Key Facts
(2013 est.)
GDP
GDP
Human
Gini Index
per capita
real
Development
(2010)88
(PPP, US$)
growth
Index87
2,100
0.515
32.1
140
5.8 %
194 of 228
146 of 187
106 of 141
billion
countries
countries
countries
The Human Development Index (HDI) measures the average of a
long and healthy life, access to knowledge, and a decent standard of
living.
A Gini Index of 0 represents perfect equality, while an index of 100
implies perfect inequality. In terms of the ranking, the first country
has the highest inequality, while the number 141 has the highest
equality.
GDP
(US$)
Doing
business89
Control of
corruption
Government
effectiveness
ranking at 43 out of 198 countries, while both
Getting Electricity and Enforcing Contracts are
extremely low at 188 out of 189 countries.
Bangladesh has declining low scores on the
Governance Indicators of Government Effectiveness
and Rule of Law. Although Control of Corruption has
improved, it remains a low ranking, and one of the
most problematic factors for doing business.
GDP per Capita (PPP), trend and forecast92
Rule of Law
10000
173 of 189
-1.05 (2007)
-0.68 (2007)
-0.83 (2007)
countries
-0.87 (2012)
-0.83 (2012)
-0.91 (2012)
A high Doing Business ranking means the regulatory environment is
more conducive to the start-up and operation of a local firm.
The selected Governance Indicators cover the years 2007 and 2012
and ranging from ‐2.5 to 2.5; i.e. negative tendencies below the zero
mean and unit standard deviation, score negative measurements. 90
Current USD
8000
6000
4000
2000
0
2017
2016
2015
2014
Bangladesh
2013
2012
2011
2010
2009
2008
India
2007
2006
2005
2004
2003
2002
2001
2000
Bangladesh has experienced growth rates at around
6% for over 15 years. Although millions are lifted out
of poverty, the country remains poor. Compared to
the rest of developing countries in Asia, with the
regional economic powerhouses India and China,
Bangladesh has fallen behind on GDP per capita
measured in Purchasing Power Parity (PPP) and the
gap is projected to widen. Here, Bangladesh is more
comparable to a Sub-Saharan African country.
Developing Asia
Inflation, trend and forecast92
12%
10%
8%
6%
4%
2%
Bangladesh combines widespread poverty and
economic backwardness with remarkable social
progress. The progress has been caused by improved
status of women, increased rural incomes, maintained
social spending and influential non-governmental
91
organisations, in particular BRAC.
0%
2016
2017
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
Bangladesh
28
27
27
27
Developing Asia
Gross fixed capital formation (% of GDP)93
35
30
Inflation has been growing for years but is curbed
below 10%. Capital formation has been on a slow and
stable increase.
28
29
30
30
29
28
29
27
25
23
22
24
23
23
23
23
24
25
25
24
24
24
24
25
20
With a Gini Index at 32.1, the income equality is
relatively high medium level. It indicates that the
economic growth is spread more evenly in
Bangladesh. Likely because labour intensive textile
manufacturing plays such an important part of
Bangladesh’s economy.
15
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Bangladesh
20
South Asia
Trade
Products share of exports (2012)
Trade and Foreign Direct Investment
(2013 est.)
95
T-shirts; 17%
Exports
Import
FDI flow
FDI Stock
27
billion US$
33
billion US$
1.2
billion US$
7.0
billion US$
19 % of GDP
24 % of GDP
0.8 % of GDP
5.0 % of GDP
Others; 31%
Sweathers,
pullovers,
sweatshirts,
etc.; 16%
Bangladesh’s export sector is dominated by labour
intensive textile production, mostly going to the EU.
The production of textiles for export has often
attracted international attention for its poor working
conditions and use of child labour.
Men's shirts;
3,1%
Women's suits;
3,2%
Men's shirts,
not knit; 6,4%Women's suits,
Men's suits, not
knit; 15%
not knit; 8,4%
Bangladesh's main export markets (2013)
Exports play an important role covering 19% of GDP.
The foreign direct investment (FDI) flow and stock are
low relative to GDP.
96
Others; 30%
Under the international textile quota system, i.e. the
Multi Fibre Agreement, Bangladesh was exempt from
quotas to the EU and the sector grew large. After 2004
when the agreement was phased out, Bangladesh has
retained a large share of international textile trade.
EU; 45%
Japan; 2,4%
Turkey; 2,4%
Canada;
3,8%
Due to increased labour costs in China, the world’s
textile production is still moving South to countries
like Pakistan, India, and Indonesia; and especially
94
where labour cost remains very low.
US; 16%
Export Processing Zones (EPZ)
Bangladesh has had eight EPZs since the 1980s, run by
the Bangladesh Export Processing Zone Authority
(BEPZA). According to an ILO survey from 2007, the
EPZs had 188,000 employees. In addition, there are
5,341 bonded warehouses, which are similar to EPZs,
and have over 3.2 million employees.
Trade agreements
Bangladesh benefits from the United States’
Generalised System of Preferences (GSP). These are
unilateral trade benefits from the U.S. government,
allowing duty and quota free access for some
products. The American Federation of Labor and
Congress of Industrial Organizations called since 2007
the United States' government to suspend trade
preferences to Bangladesh under the GSP, unless the
government took steps to ensure respect for the rights
of workers. The disaster in Rana Plaza triggered the
decision and the United States imposed trade
sanctions in June 2013 due to the recurring failure to
respect fundamental workers’ rights.
Collective bargaining is virtually non-existent in the
97
EPZ because the BEPZA discourages it. Special
legislation prohibits workers from joining unions in
EPZs. On the other hand, they can form Workers’
Welfare Associations. Legislation, which the ILO
monitoring system has observed, violates freedom of
association and collective bargaining.
In July 2014, the government approved in principle the
draft of the Bangladesh Export Processing Zone (EPZ)
Labour Law to ensure the welfare of the EPZ workers
by allowing them in constitution of organizations.
Trade unions are concerned, though, that the law does
not ensure the rights of trade union in EPZ as the
Welfare Committee has authority to bargain.
Bangladesh also benefits from the EU’s unilateral
Generalised System of Preferences, Everything But
Arms (EBA), which allows duty and quota free access
for all products except arms. The EU is also in the
process of reviewing to suspend trade preferences to
Bangladesh.
21
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