Solving the youth unemployment conundrum

We have failed our youth.

According to the latest Labour Force Survey Report (LFSR) from the National Statistical Bureau, Bhutan’s youth unemployment figure stood at  11.9 percent in 2019, an  improvement from 15.7 percent in 2018. Although the Covid-19 situation makes any economic numbers meaningless, I read the report and was hugely saddened. Why do I say that?

The decline in the unemployment rate is, partly due to our youth staying out of the labour market. This means that the youth are giving up prospecting and applying for jobs at the threshold of building their lives and careers when they should be most optimistic and full of hope about their futures. They are dis-disillusioned and uninspired. They are leaving the workforce, discouraged after long periods of unemployment looking for jobs or by the suboptimal opportunities that are available.

This should worry all of us very deeply and shame our collective conscience.

Close to 50 percent of our population are below the age of 25, and over 20 percent fall in the age range 15 to 25, typically considered as youth. These cohort will form the foundation of Bhutan’s society and economy for the next few decades. If we are to reap the ‘demographic dividend’ that many talk about, it is essential that we have a happy and engaged youth population with meaningful platforms and avenues to grow and develop. Our youth will need to have the confidence that their future is promising and that Bhutan will provide them the right opportunities to lead the possible life they can and contribute to the economy.

Bhutan has seen excellent GDP growths in the last decade averaging 6.5 percent annually, putting us consistently in the top cohort of countries performing well. During the same period, disappointingly, we have experienced persistently high youth unemployment rates averaging over 10.7 percent. This is a dismal figure for a fast growing country like ours. We have hugely failed to translate our economic growth into tangible opportunities for youth.

Youth unemployment is a major economic challenge for Bhutan. This will become more pressing as we get more graduates – leave alone the additional pressure that the Covid-19 pandemic generates. We spent the best part of last decade talking about youth unemployment. It is on the agenda of the current government as it was on the agenda of the first and the second elected governments.

Yet, we haven’t made any meaningful progress in addressing this problem. Why is this so? I believe there are three main reasons.

Firstly, there is a significant misalignment between the training and education and our economic and development objectives including the needs of the job market. This is often casually cast as the fault of the youth citing ‘mismatch of skills and experience’ by policy makers and the job market. Actually, we have been citing this excuse for over 10 years without doing anything substantial to address it. There may be some mismatch but it is nothing that is un-addressable. It is inevitable that new job seekers will need some training to adapt. The youth do not lack basic qualifications. A MoLHR-UN study from a few years ago found that over 50 percent of the unemployed youth have a degree and 87 percent have a high school qualification.

Secondly, youth employment has been limited by the lacklustre growth and the nature of our private sector.  We would have expected our private sector to expand and provide more employment opportunities. However, our fledgling private sector has struggled to grow with problems of their own, ranging from challenges to market access, lack of finance through to competition with state owned enterprises.

Thirdly, we have been constrained in our thinking and imagination around what our youth can do. Instead of challenging them to take up new ideas and providing them opportunities, our politicians and the government default to asking them go into agriculture and construction. Granted there are opportunities in these sectors but there are also some ground realities. For instance, 54 percent (over 16,000 people) of those employed already work in agriculture. I don’t think agriculture is short on labour. In addition, our terrains do not lend itself well to a commercially viable farming without significant investments and mechanisation. In addition, working in the construction sector requires retraining and then competing with workers from neighbouring India, who are in the country for a short term (often seasonally) with the objective of earning as much as possible.

In a bid to solve the youth unemployment problem, the government, over the years, has embarked on a number of initiatives, which at best are tactical and unsustainable, such as organising job and career fairs, at one time supporting guaranteed employment programmes and direct employment schemes with the private sector, and placing jobseekers overseas in markets such as the Middle East and Japan. The direct employment scheme has been discontinued and replaced by another programme which provide lower levels of support. As for the overseas programme, some undertakings have spawned many problems for the youth, parents and the government.

While these initiatives have provided some respite in the short and the middle term, we haven’t addressed the fundamental problems. There is a risk that we end up reliving the last 10 years as we face a crisis of lost generation – young productive and ambitious people either unemployed or underemployed.

The Covid-19 pandemic doesn’t make it easy but Bhutan will require a long term strategy to address the issues of youth unemployment. Towards that end. we should:

1.  Recognise that human resources are the most important resource for a small country like ours. We need to be ambitious in terms of our human capital development goals and commit to investing as much as possible into skills and capabilities of the future, particularly  focused on building a knowledge based economy. Only such an economy promises flexibility and scalability for Bhutan.

2. Identify and institute, in the short term, a comprehensive skills development programme across multiple areas that will enable the youth to explore, train and retrain themselves for the private sector. This could be undertaken in partnership with the private sector and be part funded by the Government. Simple schemes such as encouraging part time roles will also allow the youth to explore and understand what they like.

3. Develop and implement a coherent strategy and a roadmap for addressing youth unemployment. This should be anchored to our long term economic plan, identifying talent needs for specific sectors that will drive Bhutan’s economic and social agenda.

4. Most importantly, retool our education system and capabilities development approach to equip our youth with the right knowledge and skills to be competitive not only in but also outside the country.

5.  Youth unemployment cannot be resolved without working with the private sector. Therefore, make the private sector a key partner in formulating long term solutions. Support the private sector development by encouraging them and providing opportunities to participate in our development agenda across multiple sectors.

6. It is time we confront this challenge head on. We owe to our youth and our future to inspire them and give them the confidence and hope to take the nation forward.

 

Contributed by  Dorji Wangchuk

dorji.wangchuk@outlook.com

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