‘Child labour in a country like Bangladesh is primarily a development issue, not so much of enforcement’

Even though our GDP is growing, our employment rate and real wages are not increasing at the same rate. Issues of child labour and lack of labour rights also plague our labour market.

The Business Standard spoke with Rizwanul Islam, Former Special Advisor, Employment Sector, International Labour Office, Geneva, to find out the reason behind low employment rates and wages, child labour, labour practices and the state of the labour market in the country. 

Our GDP is growing, but employment is not growing at that pace. Why do you think this is happening? Is it normal? Where do the problems lie?

Despite the acceleration in GDP growth in the past couple of decades, employment growth has been slowing down. This has been noticeable, particularly for the period between 2010-2017 in comparison to 2005-2010. In a labour abundant country like Bangladesh, where the economy still has surplus labour, this is not only surprising but also not desirable from the point of view of attaining full and productive employment of the entire labour force. But why is this happening? Various factors may be at play. 

Firstly, within the manufacturing sector, only one labour-intensive industry (i.e., readymade garments) is growing and is acting as the main force of labour absorption. Even in that industry, employment growth appears to have stalled in recent years. This has happened mainly due to (i) a change in the composition of the industry – the growing importance of knitwear which is less labour-intensive than woven garments; and (ii) the adoption of labour-saving technology in both segments.  

Secondly, in the manufacturing sector as a whole, capital deepening has taken place – which indicates a shift towards more capital-intensive industries and technologies. The third factor, and one related to the above, is that labour productivity has become a more important contributor to output growth compared to the quantity of labour. That has been the case for both overall GDP and manufacturing industries in recent years. 

Over the last decade, even though the GDP has been growing, the real wage of workers is not increasing. What is the reason behind this? 

Bangladesh is a labour-abundant country with surplus labour. In a situation like this, it is possible to expand employment without raising real wages unless there is an intervention either by the government or through negotiations with the trade unions. 

How can real wages rise when there is surplus labour? In Bangladesh, there is a provision for reviewing wages periodically for different sectors and for adjusting the wage rate. On the other hand, if there is strong demand for labour, the wages of workers can rise without the intervention of the government. 

If one looks at the long-term trend of wages, one can see that there have been ups and downs in real wages. The rise in real wages could not be sustained. The main reason behind the decline in real wages for some years is that money wages have not been adjusted sufficiently to match the rise in prices and cost of living. Weak demand for labour also played an important role and that is linked to a slowdown in employment growth, as I mentioned above.

In 2020 and 2021, one could see a clear impact of the pandemic. Real wages declined in certain sectors like construction, manufacturing and fisheries. So, you see that the situation is a bit complex. While real wages did rise during certain periods, the trend could not be sustained over a long period of time. 

Last March, Bangladesh ratified the ILO convention 138 in a major move to eliminate child labour by 2025. Do we have the capacity to eliminate child labour by 2025?

This is an important step, and the government should be commended for ratifying this convention. By doing so, it has expressed its commitment to an important social goal.  

Regarding the question of the ability to implement this commitment, I would say it is not an easy target to achieve. Here, one has to recognise a few things. First, child labour in a country like Bangladesh is primarily a development issue, not so much enforcement. Of course, the tasks relating to inspection and enforcement should not be underestimated. 

Dr Rizwanul Islam. Illustration: TBS

But we have to start by asking why children work. Basically, people who send their children to work do so because they need the money earned by them. Secondly, we are still not able to ensure that they all will go to school. We need to address such issues rather than trying to eliminate child labour by adopting a legal approach. 

Actually, we do not need to look very far to develop a strategy. There are examples from within Bangladesh of how the issue can be addressed. When this issue came up in the specific context of the readymade garment industry, concerted efforts were made by the government, the employers, the trade unions and international organisations. They worked together to develop a strategy and implement that. And I think the issue of child labour in that industry has been effectively resolved. 

Now we can build on that experience. Of course, I am not saying that it will be easy to replicate the experience of the RMG industry throughout the country. This is a more organised industry where intervention is relatively easy. But at least we know what issues need to be addressed and how we can go about it. 

A broad strategy should be formulated that would combine the two approaches - development on one side and enforcement on the other. And the strategy can be implemented by bringing in a broad array of partners, including employers, trade unions, NGOs and international agencies. 

As for capacity to attain the target, one should take a dynamic approach rather than the static one of looking at what capacity exists. We should work on creating the needed capacity. 

Will our labour practices record stand in the way of EU GSP Plus?

I am aware that the country is facing an issue (labour rights) regarding our graduation from the LDC status, and in that kind of situation, we are looking for GSP+ facilities. The issue of labour standards has come up. 

Here, one should note that the global awareness of democracy and workers' rights has changed considerably compared to what we saw in the 1970s and 1980s. 

Why am I referring to the 1970s and 1980s? Those who are familiar with countries that succeeded in growing in that period, especially the countries of East and South-East Asia, like the Republic of Korea, China, Hong Kong, Singapore and Malaysia, know that their growth was based on the strategy of export-oriented labour-intensive industrialisation. Not much attention was given to labour standards like freedom of association, collective bargaining and safety, etc. Compared to that, the global situation today is very different. 

Today, even the consumers have become much more aware than they were before. Whether they are willing to pay the price for better compliance with labour standards is, of course, a different question. What we hear from the EU is a reflection of this overall change in the global environment. And it is not only the EU; other developed countries are also emphasising this issue. 

So, one has to be prepared to address them. I don't know if it will really stand in the way of the EU GSP+. That will depend on a variety of factors, like whether the country demonstrates sufficient commitment to improving labour standards and whether it is able to negotiate its way through the process. But I would say that this will remain an important issue, and we can no longer afford to take it lightly.

What is the condition of labour rights in Bangladesh? The labour secretary recently said that the government has decided to amend the labour law by December this year? Which areas should the government focus on?

Labour rights are a vast subject. If we focus on what is known as "core labour standards", the most important areas include the freedom of workers to choose their representatives and form unions, and the ability to bargain collectively (i.e., through their representatives), with the employers. There are ILO conventions in these basic areas of workers' rights. Then there are a few other conventions, e.g., on forced labour, discrimination in employment, equality of wages between men and women, and elimination of child labour. Together they form what is known as the core labour standards.  

As for the situation in Bangladesh, even if we focus on the two basic conventions, viz, freedom of association and collective bargaining, I have to say that we don't have enough information. So, I can not say what the condition is. 

But despite the absence of official data, some research has been undertaken on specific industries. If we look at some of these, especially those relating to the RMG industry, we see that a very small proportion of the workers are actually members of unions. 

Also, forming unions is not easy. Then there is the issue of export processing zones where workers are still not fully free to form unions. It is essential to look at these issues in an earnest way. We should remember that the country has already ratified the basic ILO conventions (C87 and C98) relating to the formation of trade unions and collective bargaining). 

Safety of workers and health conditions at work are other key areas that need attention. We need to put an end to the loss of lives while working for livelihoods.