Industries face 30% skill gaps: BIDS

The industrial sectors of the country are moving with a 30% skills gap, according to a recent study by the Bangladesh Institute of Development Studies (BIDS).

As productivity declines due to inefficiencies, many educated youths remain unemployed. Meanwhile, private sector organisations are struggling due to a lack of skilled manpower, the study finds.

Dr Kazi Iqbal, a senior research fellow of the BIDS, presented the findings of multiple studies conducted by the organisation at a Dhaka hotel on Sunday.

Presenting the keynote titled "Research Findings of the Labor Market Studies for SEIP on Skill Demand, Supply and Mismatch", Kazi Iqbal said, "Only 3.65% of the labour force in Bangladesh receives training each year, but the rate is only 1.35% in specific 10 sectors.

"The incidence of training for males is 1.29% and for females is 1.48% in these sectors. The rate is even below 1% for the people engaged with the RMG and textile, construction and shipbuilding sectors."

Due to the low skills and training, productivity in Bangladesh is substantially lower than the average of other Asian countries, Iqbal said.

"Separate reports have been prepared through surveys on industries and workers in 10 sectors including agro-food industry, electronics, construction, light engineering, ICT, RMG, tourism, ship-building, leather and footwear, and nursing," he said.

"We have identified five more sectors – furniture, renewable energy, pharma, jute and plastic – where untapped growth potential and skill improvement is needed. Some 23 economists, along with 13 experts of the Skills for Employment Investment Program (SEIP) were involved in the research," he said, adding that the studies have been conducted in 1,138 industrial firms and on 7,018 labourers.

Kazi Iqbal said the extent of the skill gap in the economy is about 30% and it increases with the level of technological sophistication of sectors. The skill gap, however, is lower in construction, light engineering, small-scale electronics and leather sectors.

Agro-food processing and RMG sectors are facing a relatively moderate skills gap. But the gap is higher in ICT, Ship-building, and the large-scale electronics sectors, he said.

The skill gap is higher among professionals and technical persons like managers, professionals, technicians, salesmen, clerks, and craftsmen.

"Female workers are more proficient than male workers in female-dominated industries like RMGs. About 9.22% of the males in the RMG sector face low proficiency problems while 25.22% of them have moderate proficiency and 65.56% have high proficiency," said the BIDS fellow.

On the other hand, 70.78% of females in RMG have high proficiency and 19.85% have moderate and 9.37% have low proficiency, he said.

The skill gap is higher in senior-level positions. It can be observed in the IT and other industries that require sophisticated skills, he added.

Workers for white-collar jobs like managers and professionals are harder to find, he said, marking the lack of skilled people for the industrial sector. "About 9.43% of managerial posts in the agro-food processing sector would be recruited instantly, and it requires more than a week in 61.29% cases and more than a month in 11% cases."

Dr Kazi Iqbal stressed a comprehensive programme by the government, private sector and NGOs to improve the skills of human resources. 

"Only 8.28% of labourers in the light-engineering sector receive any training in their entire service life, while 6.77% receive training arranged by the employers," he said, adding that similar scenarios can be found in the construction sector.

Firms in the private sector have no incentive to provide training on general skills. Thus, the government should provide such training, he said.

He also stressed the social recognition of technical and vocational education to increase the rate of enrollment in this field.

In the 70s, about 47.4% of our migrant workers were unskilled and it still remains at 46.56%. Expatriate income will increase if skilled people can be sent abroad, he said.

Speaking as the chief guest on the occasion, Planning Minister MA Mannan said that along with everything else, skills development is also being done slowly. Nothing can be changed overnight.

"I think development is important before good governance. Because a large part of the country's rural population lacks access to food, clean water and justice. They will be happy to get these things. For this, development must be done first," he said.

Md Ekhlasur Rahman, additional secretary of the Finance Division and executive project director of the SEIP, said the government has prioritised skills development and launched the Skills for Employment Investment Program (SEIP) in 2014.

With this programme, financed by the Asian Development Bank (ADB) and the Swiss Agency for Development and Cooperation, the government provided training to more than five lakh youths, of which over 3.5 lakhs are employed at home and abroad, he said.

Dr Sayema Haque Bidisha, a professor at Dhaka University, said, "We still have to talk about the labour market with the data from 2016. Although there is no census, data should be released in some cases through some models."

Zafrullah Chowdhury, the founder of Gonoshasthaya Kendra, said the number of educated youths in the country is very high. They should be trained. As the number of elderly people increases, they should be given service training where there are high-paying jobs."

BIDS Director General Dr Binayak Sen presided over the event. He said, "A fair wage in the labour market increases the desire for training among workers. We need to match training to labour market wages."

"Measures should be taken from now on according to the demand of workers in the next 10 years. Besides, workers should be made more efficient before sending abroad," he said.

"Unskilled workers in industrial factories are reducing productivity as they are not able to adapt themselves to technology. This leads to the possibility of falling into a low-productivity trap similar to the middle-income trap," the BIDS DG added.