Unemployment Crisis: Youth in South Asia at Risk
The demographic dividend in nations like Nepal, Bangladesh, Sri Lanka, and Indonesia faces a significant threat due to rising unemployment rates and persistent corruption. These countries have a young population eager to enter the job market, but the growth experienced has not translated into job creation. This disparity has led to youth-led protests, showcasing the frustration of the younger generation, especially against the backdrop of lavish lifestyles displayed by the elite.
In Nepal, the situation is particularly dire. With a high reliance on remittances from foreign employment, the country struggles to create jobs domestically. The National Statistics Office of Nepal reported a rise in unemployment to 12.6% in 2022-2023, up from 11.4% in 2017-2018. The limited job opportunities in the formal sector mean that many young Nepalis are looking abroad for work, which accounts for almost a quarter of the country’s GDP.
Similarly, Bangladesh and Sri Lanka face their own challenges. While Bangladesh's unemployment rate remains at 3.35%, the youth unemployment rate is significantly higher at 8.24%. In Sri Lanka, public unrest has erupted over issues of corruption and economic mismanagement, further exacerbating the difficulties faced by young individuals seeking work.
Indonesia presents a stark example of the disconnect between the ruling class and the average citizen. Following violent protests against a proposed housing allowance for parliamentarians, the finance minister was dismissed. Such actions only intensify the perception of corruption and inequity, leading to growing discontent among the youth.
Despite the potential for economic growth that a young workforce represents, these nations are failing to capitalize on this advantage. Reports from the Asian Development Bank note that significant economic growth hasn't led to sufficient job creation—the traditional industries that once provided entry-level jobs are now mechanized.
As countries depend more on technology and automation, the job market shrinks, leaving young people without opportunities. The World Bank has emphasized that South Asia risks squandering its demographic dividend, having created only about half of the jobs needed in the past two decades.
Without immediate and effective measures to create jobs in emerging sectors, countries like Nepal, Bangladesh, Sri Lanka, and Indonesia face the impending danger of missing out on the economic benefits associated with their youthful populations. Addressing these challenges is critical for ensuring that the demographic dividend does not turn into a demographic disaster.
