ISLAMABAD, Sept 23: South Asia will become the largest contributor to global workforce over the next two decades, and eight countries including Pakistan would have to explore adding between 1 and 1.2 million additional jobs every month for the next twenty years, emphasises a new World Bank report published on Friday.
The creation of additional jobs by Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka will be equivalent to about 40 per cent of the increase in the global labour force, according to the report titled “More and Better Jobs in South Asia”.
The report says that South Asia has seen an accelerated job growth and a substantial decrease in poverty over the past three decades, and more and better jobs are needed to sustain growth and reduce poverty.
“The key asset for South Asia is its people. South Asia has a young population and the second lowest female participation rate in the labour force.
The demographic transition will result in more than 350 million people to enter the working age population over the next two decades,” said Isabel Guerrero, World Bank South Asia Vice President.
“Creating jobs for them will contribute to growth, equity, and peace in the region.”
The region created 800,000 jobs per month between 2,000 and 2010.
However, despite growth, the region is still home to the largest number of the world’s poor – a half billion people.
Since labour is the primary asset of the poor, having more and better jobs is the key employment challenge facing the region, says the report.
The report says that among the five large countries in the region, employment growth since 2000 was highest in Pakistan, followed by Nepal, Bangladesh, India and Sri Lanka.
Total employment in South Asia excluding Afghanistan and Bhutan rose from 473 million in 2000 to 568 million in 2010, creating an average of just under 800,000 new jobs a month, the report says.
Nearly a third of workers in India and a fifth of workers in Bangladesh and Pakistan are casual labourers.
Regular wage and salaried workers represent a fifth or less of total employment, the report points out.
The World Bank report further says that increasing proportions of casual and regular wage or salaried workers in Bangladesh, India and Nepal and all wage workers in Pakistan and Sri Lanka are also now in households that are above the poverty line.
The pressure to create better jobs will intensify very substantially over the next few decades.
UN projects that the region’s current population of 1.65 billion will increase 25 per cent by 2030 and 40 per cent by 2050.
Given the region’s generally youth population, the working-age population is projected to increase even more - 35 per cent by 2030 and 50 per cent by 2050.
Pakistan, Nepal and Afghanistan are the countries where proportionate increases are the largest with the youngest population, says the report.
The report went on to say that the employment challenge in South Asia is one of improving job quality rather than quantity, as job growth over long periods tracks the growth of the working-age population.
In the presence of policy reform, the demographic transition can provide a favourable tailwind in support of economic growth and improving job quality.
The World Bank report points out that corruption is among the top five constraints in South Asia.
Firms face high levels of corruption in a range of interactions with public officials, particularly for utilities and tax inspections.
Government interactions that have the highest frequency of bribes vary by country.
In Pakistan, the highest frequency (71 per cent) is for electrical connections; 62 per cent for water connections and 59 per cent for tax meetings.
Other countries are Afghanistan, Bangladesh and India.
The report says that South Asia is characterised by low levels of access, low consumption per capita and wide demand-supply gaps.
Some 600 million people in the region lack access to electricity – more than 40 per cent of the world total.
The toll on the economy is enormous, and in Pakistan the cost of industrial load-shedding is 400,000 lost jobs. The energy sector deficit in Pakistan is estimated at about $2 billion a year, compared to $32 billion of investment needs in 2010-2020.
Measured by the proportion of country-years in conflict since 2000, the report terms South Asia as most conflict-affected major region in the world.
Afghanistan, Pakistan, India and Sri Lanka are among the four top countries in terms of direct deaths from armed conflict in 2008.
Ongoing conflicts affect all of the Afghanistan and parts of Pakistan and, at a lower intensity, India, Nepal and Sri Lanka are in post-conflict status.
The report reveals that almost 60 per cent of firms in South Asia ranked political instability as a major or severe constraint to doing business.
Even when it is already over, armed conflict remains a serious obstacle to job creation in South Asia, it says.