Recovery and Advancement of Informal Sector Employment

active

Prospective

Despite rapid economic and social progress in recent decades, Bangladesh faces significant structural challenges in job creation, job quality, skills shortages, and skills mismatches. Slowing job creation has stunted transformation of the labor market, where informality and poor job quality remain the norm. Just one in five workers are wage employed, and both formal and informal workers experience poor working conditions and vulnerability. Gender disparities remain acute with female labor force participation half of that of men. Care responsibilities are cited as one of the main constraints for women not being in the labor force. As the working-age population begins to decline from its peak and the dependency ratio rises in the coming decades, significant improvements in youth unemployment through the creation of opportunities will be crucial. Globally, government-led economic inclusion programs targeting youth entrepreneurs, with a combination of training and access to finance, have shown positive impacts, including initiation of new businesses, lower chances of reporting negative income changes, and longer business survival. The Additional Financing (AF) supports the economic inclusion program and the necessary institutional capacity building to implement the program equitably, efficiently, and transparently. The program targets low-income, less-educated youth, including those whose livelihoods have been affected by shocks. This is implemented by the Palli Karma-Sahayak Foundation (PKSF). The parent project's progress in achieving its development objectives is highly satisfactory. The AF responds to the Government of Bangladesh's request to expand and scale up selected parent project activities. The AF would address identified vulnerabilities, including those exacerbated by climate change, to support economic inclusion of targeted beneficiaries in urban and rural locations across the country. With the informal sector continuing to play a significant role in the country over the medium term, the project’s approach recognizes it as an asset for job creation and providing economic mobility opportunities at scale. By leveraging its potential for employment and inclusion, project interventions can impact the productivity of the sector while introducing measures for better occupational health, safety, and worker welfare. Moreover, innovations introduced under the AF would provide an opportunity to determine benefits resulting from additional support, such as improved access to quality childcare services.

FY17 - Financial Sector,FY17 - Social Protection

World Bank

Project

Road, Commercial, Government