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Demographic dividend: The clock is ticking

Homo Sapiens

Feb 3, 2015

Demographic dividend: The clock is ticking

According to the preliminary census report, the percentage of people aged between 20-29 decreased since 2011, possibly foreshadowing a loss in demographic dividend. The Business Standard speculates the impacts​

Infographic: TBS

Infographic: TBS

Bangladesh's population growth is slowing down.
According to the preliminary report of the "Population and Housing Census 2022" done by the Bangladesh Bureau of Statistics (BBS) released on Wednesday, our annual population growth rate is 1.22%. The report also tells us that Bangladesh's population has increased by 2 crore 11 lakh in the last 11 years.

This slowdown, however, should not come as a surprise to anyone. The population growth rate has been decreasing gradually, not overnight. In fact, not just in Bangladesh, but the population growth rate is down globally as well.

Bangladesh has been enjoying a high percentage of the work-age population for some time now. But as the population growth rate decelerates, concerns about how long Bangladesh will enjoy this high work-age population have been raised. So how will this slowdown impact our labour market? How do we make the best of this demographic dividend until the work-age population dwindles and dependency increases, and how long do we have?

The population growth rate is the difference between the birth rate and the death rate, and the migration rate is factored in as well. According to the preliminary census report, the average population growth rate now stands at 1.22%; the previous census conducted in 2011 was 1.37%. The rate was as high as 2.84% when the second census was conducted in 1981.

Our birth rate is decreasing due to a combination of factors. One is people bearing a lower number of children than before thanks to family planning, education and modernisation. In 1974, each family had 6.4 children on average, which has come down to 2.1. The credit for this success goes to long-term planning.

Simultaneously our life expectancy has risen continuously and the survival rate of women at birth has increased a lot. All these factors have combined to bear the fruit called demographic dividend - a boost in economic productivity that occurs when there are growing numbers of people in the workforce relative to the number of dependents.

"As the population growth rate declined due to lower fertility and mortality rates over the past decades, the working age population increased. According to the preliminary census, the working-age population makes up 65.15% of our total population," said Dr Mohammad Mainul Islam, Professor and Former Chairman, Department of Population Sciences, University of Dhaka. "The globally working age population means people aged between 15-64; in Bangladesh, it is 15-59."

"This working-age population will continue to grow until 2037-2038. Population aged 0-14 will wane due to fertility decline, but the working age population will increase. Today who is aged five, 10 years later, will be aged around 15. On the one hand, the young dependent population will decline," he added.

Although the number of working-age people is expected to grow for some time, the percentage is already on decline.
According to the preliminary report, the percentage of people aged between 20-24 dropped from 9.23 in 2011 to 9.08 in 2022, and the percentage of people aged between 25-29 fell from 9.36 to 8.71. The percentage of people aged between 30-34 has remained nearly the same, while the percentage of people aged 35-39 rose from 6.63 to 7.7. The trend of an ageing population continued as the percentage of people aged 40-44 increased to 6.08 from 5.74.

As the younger populace is showing a declining trend in terms of percentage, how worried should we be?
In fact, so far, we have not been able to use the high work-age population fully. A large working-age population is not necessarily an asset for the country. Why? Experts argue they are not an asset unless you can provide them employment.

"We have a working-age population of around 65%, but how many jobs are we generating each year? How many jobs were supposed to be created under the '8th Five-Year Plan' by the government? What plans do we have for 2041? I have observed that unemployment among the youth group is quite high in Bangladesh. Compared to 1993-94, youth unemployment has doubled according to the labour force survey 2016-2017," said Dr Islam.

"There has been a surge in graduates in recent times, but technical and vocational studies remain largely ignored. However, skilled workers with technical know-how are in demand. It can be argued that this mismatch between job requirements and candidate qualifications is contributing to unemployment.

Our dependency ratio on paper is decreasing, but this is being measured using the proportions of the population. However, "whether the population is employed or not, whether they are properly educated or not, if they are healthy or not, these factors also need to be taken into consideration," Dr Islam continued.

"In the long run, people aged more than 65 years or more will increase as our life expectancy is on the rise. Then you will have to consider keeping this older population involved with the labour market. You will have to think about the health and social welfare system. You have to plan beforehand. There should be two types of plans, one long term and the other short term," explained Dr Islam.

Why can't we take advantage of the demographic dividend?
According to Dr Islam, "If we don't get investment, especially FDI (Foreign Direct Investment), if new employment is not generated, if market-based and technical education is not given importance, if your labour force is not healthy, your population will not be very productive. As a result, they will not be able to contribute much to the economy."

The professor is of the opinion that we also have to consider whether the government has a sound economic policy in place and has ensured good governance.

So how do we reap the benefits of the demographic dividend?
Experts suggest we have to integrate this work-age population properly into the labour market; this includes both the local and the international labour market. We have to prepare this work-age population in accordance with the demands of the global market.

Dr Islam said, "For example, there are 10 members in your family. Out of these 10, seven are part of the work-age population. However, they are not in the labour market because they are not healthy enough to work; they are malnourished as they can't have calorie-rich foods and are not properly educated. If this is the situation, will you get the benefit [of a high work age population]?"

"This means to reap the benefits; we also have to invest in health. If you take a look at our budgetary allocation, you will see we invest very little in health; one of the lowest in South Asia. It is the same situation when it comes to education. Our policymakers need to invest more in these two sectors," he added.

We need to focus on the jobs that are in high demand in the changing global labour market. "In many scenarios, private organisations complain that they don't get skilled graduates who are technically sound. So the industry and academia need to have a proper link. From the country's point of view, we need to assess the situation and make our move appropriately," implored Dr Islam.

Nasif Tanjim. Sketch: TBS



Apr 18, 2012
United Kingdom
United Kingdom
We need to propel our economy forward.

Demography dividend will be there for the next 20-30 years.

Planning and execution of proper policy is the key. I am not worried about drop in population, we have enough and drop in growth is a positive.

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