Bhutan’s Unemployment Rate at Historic Low of 2%

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A majority of the persons (300,831) in the labour force are employed. Unemployment rate is the proportion of unemployed persons in the labour force. This corresponds to 5,970 persons who are unemployed.

Bhutan’s Unemployment Rate at Historic Low of 2% (Source: http://thebhutanese.bt)

 

According to the Bhutan Living Standards Survey (BLSS) report done from March to April 2017, the unemployment rate of the country has hit the lowest at 2 percent compared to 2.7 percent in 2012.

This lower than the 2.1 percent unemployment rate of the 2016 Labour force survey is done with a smaller sample size by the Ministry of Labour and Human Resources.

A majority of the persons (300,831) in the labour force are employed. Unemployment rate is the proportion of unemployed persons in the labour force. This corresponds to 5,970 persons who are unemployed.

In other words, 2 percent or 5,970 person aged 15 years and above who are looking for work and available for work could not get work during the reference period.

Breakdown of unemployment rate according to age groups and gender

The highest employment rate of 11 percent is observed in the age group (15-24 years). In the same age group, female unemployment (11.7 percent) is somewhat higher than male unemployment (10.4 percent).

In other age groups, except in the age group 25-34, unemployment rates are as low as one percent, including for both males and females.

As per Labour force survey (LFS) 2016, by the Labour Ministry, youth (15-24) unemployment rate was 13.2 percent. The difference in unemployment between BLSS 2017 and LFS 2016 could be attributed to the sample size and seasonality.

The BLSS sample size is much bigger and the survey is done by a specialised technical organization which is the National Statistical Bureau.

Overall, in the BLSS, there is a marginal difference in unemployment rates for males (1.8 percent) and females (2.2 percent).

For those who were employed, information about their main occupation status was gathered. Among the occupational statuses, own-account worker (60.7 percent) accounted for the largest proportion of all employed persons, while regular paid employees made up a little over 26 percent.

Seven out of ten (70.7 percent) employed females and five out of ten (53.4 percent) employed males are own-account workers. In contrast, more than three out of ten (32.7 percent) employed males and just about two out of ten (17.8 percent) employed females are regular paid employees.

Unemployment rate in the rural and urban areas

In urban areas, a majority of the employed persons accounted for own-account workers (74.9 percent), while in rural areas, regular paid employees (63.6 percent) made up the largest proportion.

A difference is observed between males and females in these two occupational statuses. A majority of the rural females (82.7 percent) are own-account workers as compared to their male (68.7 percent) counterparts, while a majority of the urban males (70.8 percent) are regular paid employee in comparison to urban females (51.5 percent).

The working-age population which includes all persons’ age 15 years and above is estimated at 506,611 persons, of which, 239,833 are males and 262,778 are females. About one third (32.8 percent) of working- age persons are in urban areas and two thirds (67.2 percent) in the rural areas.

Therefore, more people within the working-age group are found in the rural areas. Labour force participation is estimated at 61 percent for the country, 64 percent in the rural areas and 56 percent in the urban areas, which means a high proportion of the labour force is employed.

The working age population is highest in the age group 25-34 years, and declines thereafter. However, slightly over one fourth (26.2 percent) of this age group are economically inactive, which means that these people are out of the labour force.

Similarly, the highest number of the people employed is in the age group 25-34. It comprises of the economically active as well as the economically inactive population. The economically active or labour force or work force includes the sum of employed and unemployed person.

The labour force represents the current supply of labour for the production of goods and services in the country.

The economically inactive includes those who are not part of the labour force or who fall outside the labour force, which is, economically inactive person are neither employed nor unemployed.

Labour force participants rate is 61 percent throughout the country. The labour force participation rate for females (49.6 percent) is significantly lower than their males (73.6 percent) counterparts.

This indicates the prevalence of gender disparities in the labour force participation in the country.

The unemployment rate is significantly higher in urban areas (4.6 percent) as compared to rural areas (0.8 percent). This shows that unemployment is more of an urban phenomenon.

In urban areas, female unemployment rate is estimated at 6.1 percent as compared to 3.6 percent for males.

Gender disparities in labour force participation

Gender disparities in labour force participation (73.6 percent for males and 49.6 percent for females) are greater than urban-rural disparities.

It is observed that unemployment is more predominant in urban areas than in rural areas in almost all the age groups, irrespective of sexes. Specifically, in the age group 15-24, urban females are more unemployed than urban males.

Unlike in urban areas with higher unemployed females, rural men’s unemployment is somewhat higher than women’s unemployment for the age group 15-24 years.

Across Dzongkhags, labour force participation rates, range from 55 percent to 73 percent. It is highest in Tsirang (72.8 percent) and Gasa (70.8 percent), while the lowest rates are found in Trashigang with labour force participation rate of little more than 55 percent and Thimphu with 56 percent.

Among the Dzongkhags, Thimphu has the highest unemployment rate with about 6 percent, followed by Chhukha at 3 percent and other Dzongkhags have rates of 2 percent and below.

According to the highest educational attainment, slightly more than half (51 percent) of the working-age population did not attend formal schooling or have had no schooling.

While a majority of the employed persons have no schooling, about 60 percent of the unemployed have secondary education and above. This is because a majority of those who are employed and have no schooling, are farmers.

Among the economically inactive, almost half (48.1 percent) have had no schooling. Overall, the unemployment rate increases gradually from lower towards higher levels of education.

The unemployment rate is 2 percent among those with primary education, 3 percent in the case of secondary education, and over 4 percent in the case of education level above secondary level.

A similar trend of gradual increase in the unemployment rate, from lower towards higher level of education, is observed for both males and females, especially in rural areas. In urban areas, there is not much difference in unemployment rates among people with primary level schooling (5.4 percent), secondary schooling (4.7 percent), and above secondary schooling (5.1 percent).

The current labour activity status of the sub-populations of the working-age group according to their highest level of education shows that a majority of the working-age population, irrespective of level of education, are employed.

Among those with no schooling, about 63 percent are employed, while about 37 percent are economically inactive. The proportion of economically inactive is highest among those with secondary education (43.9 percent) and above secondary (40 percent), the lowest proportion is among those with primary level schooling (35.3 percent).

Employment is highest among those with no schooling (62.6 percent) and primary schooling (63.5 percent).

 

By Kinley Yonten (This article has been edited for the New Bhutan Times)

This article first appeared on The Bhutanese.

 

 


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