The labor force in Bangladesh has increased over the period from 1995-96 to 2001-03. Total labor force participation rates have also risen, though male rates declined initially. Most workers are employed in agriculture, though non-agriculture employment is growing. Unemployment rates increased in the first period but remained steady in the second period. While employment is increasing, underemployment may also be on the rise.

1. An Assignment
On
THE LABOR MARKET SCENARIO OF BANGLADESH
SUBMITED TO
Mrs. Nigar Nargis
Assistant Professor
Dept. Of Economics
University Of Dhaka
SUBMITTED BY
Md.Shafiqul Alam
Roll No:060
3rd Year Hon`s
Session: 2004-2005
Dept. Of Economics
University Of Dhaka
Date of Submission: 3rd April 2006

2. Acknowledgement
This assignment has been prepared with the help of the data, graphs and
charts taking from Report on Labor Force Survey 2002-2003 which was
published by Bangladesh Bureau of Statistics (BSS). As a result all the tables of
this paper belong to secondary data.
It is also mentioned that the labor force flow diagram used in this paper has
been taken from the book – Modern Labor Economics, Theory and Public
Policy, by –Ronald G. Ehrenberg and Robart S. smith, published by Addison
Wesley.

3. CONTENTS
1. Introduction
2. Report labour force survey
3. Flowing diagram of labour force
4. Labour force participation rate
5. Labour force participation rate by age and sex
6. Broad sector of employment
7. Unemployment rate
8. Conclusion

4. INTRODUCTION:
Labour market is considered as one of the important macroeconomic
markets and labour is the inevitable components of production. Its importance in
broad economical perspective of growth, stability and development cannot be
denied. In the context of Bangladesh its importance is several degree higher for
its being densely population with considerable economically active generation.
In this particular term paper we will try to make brief scenario of the labour
market of Bangladesh during the period of 1995/96 to 2002/03 with the help of
Labour Force Survey (LFS) report conducted by Bangladesh Bureau of Statistics
(BBS).
The usual or conventional definition of labour force or economically
active population of the population aged 15 years and over has been used in the
LFS 2002-03. According to the usual definition any person aged 15 years and
over who was either employed or unemployed during the reference period and
any person of the same age putting in a minimum of one hour’s work in family
farm/enterprise for pay or profit during the reference period is considered
economically active. Only usual definition of economically active population
would followed for the population of age 15 years and over to estimate the labour
force characteristics of Bangladesh. The purpose of the survey, like those of the
earlier ones, is to estimate the size and composition of civilian labour force and
its characteristics such as age and genders specific labour force participation rate,
status in employment, unemployment and duration of unemployment etc.

5. Report labour force survey:
Table 1.a:
Usual definition, population, labour force, employed, unemployed not in
labour force.
LABOUR FORCE SURVEY 2002-2003:
Year Labour survey(15+population)
force
Population 1999-00 2001-
Labour and others 1995-96 03
Labour Male 30.7 32.2 36.0
force(million) Female 5.4 8.5 10.3
total 36.1 40.7 46.3
Employed Male 29.8 31.1 34.5
population(million) Female 5.0 7.9 9.8
Total 34.8 39.0 44.3
Unemployment Male 0.9 1.1 1.5
population(million) Female 0.4 0.7 0.5
Total 1.3 1.8 2.0
Not in labour Male 4.6 6.2 5.2
force(million) Female 28.7 27.3 29.3
Total 33. 33.5 34.5
Total population of 121.8 123.1 127.1
Bangladesh
From the dada it is observed that the population in Bangladesh has been
increased from the period 1995/96 to 2001/03. Population was 121.8 million in
the labour force survey 1995/96. Bu8t by the next five years population increased
by 123.1(million) from 121.8(million)in the period 1999/00.And in the period
2001/03 the population increased by 127.1(million) from 123.1(million). So, in
the 1st phase (1995/96-1999/00) population increased by only 1.3 million and in
the 2nd phase (1999/00 2001/03) population increased by 4 million. So we can see
that the total population of Bangladesh increased significantly during the period.
We can also see that in the labour force survey 1995/96 total civilian
labour force was 36.1million that was 29.64% of the total population and in
1990/00 total civilian labour force was 407 million that was 33.42%of the total

6. population. And in 2001-03 total civilian labour force was 46.3 million that was
38.01%of the total population. We can also see that employed population of total
labour force was 96.4% in the period 1995-96. It was 95.8% of total labour force
in 1990/00 and 95.7%of the total labour force in 2001-03. And unemployment
population was 3.6% of the total labour force in 1995/96, 4.2% of the total labour
force in 1999/00 and 4.3% of the total labour force in 2001-03. Figure: The flow
diagram of labour force survey (15+ populations).
Table 1.b
Usual definition: Labour force
Year Labour Survey
force (15+population)
Population 2001-03
Labour and others 1995-96 1999-00
Labour Male 30.7 32.2 36.0
force(million) Female 5.4 8.5 10.3
total 36.1 40.7 46.3
Table 1.b represents the data of labour force. Total labour force was 36.1
million in the 1995-96. Male and female labour force was 30.7 and 5.4
respectively in that period. Total labour force was 40.7 in the 1999-00 and has
been 46.3 in the 2001-03. It is continuously increasing from 1995-96 to 2001-03.
In 1999-00 and 2001-03 male labour force is 32.2 and 36 and female labour force
is 8.5 and 10.3 respectively. Now it can be concluded that the labour force
throughout the whole period increased. In the first phase (1995/96 – 1999/00)
total labour force increased by4.6 million and in the second phase (1999/00-
2001/03) total labour force increased by 5.6 million. Here the labour force
increasing at a increasing rate. The trends of the labour force are below
represented graphically-

7. Trend of labour force
force(million)
60
Labour
40
20 male
0 female
1 2 3 total
1995-96 1999-00 2001-03
Year
Labour force participation rate:
Labour force participation rate could be defined as the proportion of
the civilian population aged 15 years and over who are in the labour force. That
is-
Labour force participation rate = (Labour force/Population) x 100
Here labour force = Employed Persons (EP) + Unemployed Persons (UP)
Now I will show the LFPR by gender over time in the following data during the
period of 1995-96, 1999-00 and 2001-03.
Year survey(15+population)
Labor force
LFPR 1999-00 2001-03
1995-96
Male 87.0 84.0 87.4
LFPR Female 15.8 23.9 26.1
total 52.0 54.9 57.3
Source: Report labour force survey 2002-03
From the table we can see that labour force participation rate in the1995-
96 was 52.0. Male participation rate was 87.0 and the female was 15.8. In the
1990 / 2000 and 2001/03 total labour force participation rate increased 54.9 and
57.3 respectively. Now it can be concluded that throughout the whole period
labour force participation rate increased as it was 52.0 in the 1995/96 and 54.9in
the 1999/00 and 57.3 in the 2001/03.In the first phase participation rate increased
by 2.9 and in the second phase increased by 2.4. On the other hand both of male

8. and female labour force participation rates also increased throughout the period
but male participation rate decline in the first phase by 3.0. In this period female
participation rate increased by 8.1.In the second phase both male and female
participation rate increased by 3.4 and 2.2 respectively.
Trend of labour force
participation rate
100
50 Male
0 Female
1 2 3 Total
1995/96 1999/00 2001/03
Labor force participation rate by age and sex:
Labour force participation rate by age and sex has been presented in
table 3.1.a It is found that at national level, the highest participation rate was
observed in age group 40-44(65.9%), followed by age groups 45-49 and 35-39(
64.6%). On the other hand, the lowest participation rate was found for age group
65 years and over because in the higher age group people naturally become
physically unable to participate in economic activities for their old age
complications.
Table 3.1.a: Labour force participation rate by age group and sex :
Age group Labour force Participation rates
(%)
Both sexes male Female
Total 57.3 87.4 26.1
15-19 49.7 58.9 38.2
20-24 53.8 84.9 26.7
25-29 58.4 97.7 27.5
30-34 62.1 99.7 27.2

9. 35-39 64.6 99.8 28.1
40-44 65.9 99.7 25.6
45-49 64.6 99.5 22.6
50-54 62.8 99.2 19.9
55-59 61.0 97.3 17.2
60-64 52.6 87.8 13.4
65+ 40.3 66.1 8.7
Sex differential in participation rate by age is pronounced. For the males, the
highest participation rate (99.8%) was observed for age group 35-39 whereas for
the females the highest participation rate (38.2%) was observed for age group 15-
19. It may be mentioned that the participation rate for male ranges from 99.8% to
58.9% compared to 38.2% to 8.7 % for females. It is interesting to note that, for
males the participation rate increases sharply from age 15-19 and reaches s
maximum in the age group 35-39.however , for females it reaches at the top
(38.2%) in the age group 15-19(mostly unmarried) gradually decreases for
marriage and other reasons.

10. 120
100
80 Both sexes
60 Male
40 Female
20
0
15-19 25-29 35-39 45-49 55-59 65+
Broad sector of employment:
Employed persons by broad sectors of employment have been presented
in table 4.1. It is observed from the table that among the employed persons of
both sexes, 51.7 percent mere engaged in agriculture sector and 48.3 percent in
non-agriculture sector. In the non-agriculture sector out of 48.3f percent as high
as 34.6 percent were engaged in service sector and the rest 13.7 percent were
engaged in industry sector.
Table: Employed person 15 years and over by gender broad economic sectors:
Broad Both sexes Male Female
economic sector Percent (%) Percent (%) Percent (%)
Total 100.0 100.0 100.0
Agriculture 51.7 49.8 58.6
Non agriculture 48.3 50.2 41.4
Industry 13.7 12.3 18.4
Among the males, 49.8 percent were employed in agriculture sector and 50.2
percent in non-agriculture sector. Of those employed in non-agriculture sector, as
high as 37.9 percent were employed in service sector and the rest 12.3 percent
were engaged in industry sector. On the other hands, among the females 58.6
percent were in agriculture sector and 41.4 percent were in non-agriculture sector
of which services sector employed 23.0 percent and industry sector 18.4 percent.

11. 60
50
40
30
Series1
20
10
0
Agriculture Industry Services
.
Employment in broad sectors (%)
Unemployment rate:
Unemployment is perhaps the worst scrounge of a modern economy. The
unemployment rate is defined the proportion of the labour force that is
unemployed. The unemployment rate expresses the total labour time lost due to
unemployment as a proportion of total labour time of the entire labour force.
Here the data of unemployment rate –
Table :
Usual definition: unemployment rate %
Year Survey
Labour force (15+population)
Unemployment rate 1995-96 1999-00 2001-03
Male 2.8 3.4 4.2
Female 7.8 7.8 4.9
total 3.5 4.3 4.3
Source: Report LFS-2002-03, BBS
Table represents the data of unemployment rate. Total unemployment rate was
3.5 in the LFS 1995/96. Male and female unemployment rate was 2.8 and 7.8
respectively. In the LFS 1999/00 total unemployment rate increased to 4.3 and

12. male unemployment rate also increased to 3.4.But female unemployment
unchanged 7.8. Total unemployment rate unchanged 4.3 and male
unemployment increased to 4.2 and female unemployment decline 2.8to 4.9.
Now it can be concluded that unemployment rate increased in the first phase
(1995/96- 1999/00) but in the second phase (1999/00 to 2000/03) unemployment
rate unchanged. Here the trend of unemployment represented graphically.
Trends of unemployment rate
Unemployment
10
rate
5
Male
0 Female
1 2 3
Total
1995/96 1999/00
2001/03
Conclusion:
From the above discussion finally we can say that we get a clear and exact
idea about the labour market scenario of Bangladesh during the period 1995/96,
1999/00 and 2001/03. Although employment rate increasing more than
unemployment rate all through the years but interestingly underemployment rate
is increasing. Even considering the contribution of Labour Force in broad
economic sector we see that its contribution is increasing in agriculture but it has
no sufficient contribution to industrial and service sector which economically
leads to inefficient allocation of natural resources.