And what about Human Capital?

Guest Post by Tahmina Shafique, WB-SAES  Youth Delegate from Bangladesh

South Asia is the story of a massive workforce, rising youth population- ours is the story of people, their hard work, their contributions. South Asia, in economic terms, is the story of human capital. It is the integral part of economies. Yet, harnessing human capital, and investing on human capital, remains to be at the far end of the critical agendas of each economy. In a way, we have lost that L (Labour) in our production functions, as Shekhar Shah, the chair of this afternoon’s session, rightly pointed out. The L within our production function has just become a random, sweeping arena.

How long will these economies really be able to sustain with low levels of investment, low quality public education, low levels of skills development and more?

Employment, jobs seems to be an “easy” issue in South Asia, but the time has come to look at this issue with eyes wide open. With increased number of youth population in South Asia, it is important to look at the issue of employment. Are there enough jobs for the large and growing youth population? Even if jobs are created through informal sector, can we produce good quality and productive workforce?
Now there are multiple areas to think about- we have an informal sector and formal sector, the education system, skills training and finally the cross cutting arena: politicization.

The informal sector dilemma: Starting with the informal sector, million of workers in Asia, account for almost two third of the total workforce who are engaged to informal work. The growing size and scale of the informal economy shows that it has become the normal and predominant economic activity for workers in Asia. When investments are being made, how does one attempt to increase the productivity levels of these informal markets which are characterized by low levels of productivity? A lot of the learnings do happen through spillovers, in that case, does greater integration help?

The story of formal sector: Meanwhile in the formal sector, informalization is institutionalized through deregulation of labour law promoting flexibilization of the labour market. As a result, the power of trade unions is dismantled. The absence of the right to collective bargaining and freedom of association then exacerbates the working condition of informal workers. Isn’t it time to address these collectively? Does the private sector have a responsible role to play here?

Education systems: The education sector in South Asian countries remains to be weak. The public education does not have enough expenditure allotted to this sector, which results in poor quality education. To add to that, politicization within the education sector remains to be rampant where for example, vice chancellors are appointed in accordance to political influence rather than the experience and required qualifications. In the private sector, while the quality of education starts off well, they are expensive which means access is a major issue. In addition to this, private sector education institutes grow at a fast rate, as in case of Bangladesh. In this case, the overall quality drops significantly.
Skills development: While private and public institutions are in place, they remain to be characterized by poor quality and majority are inadequate to respond to the growing and changing demand and market patterns and employment needs.

Having explored all of the above, which were discussed this afternoon in the plenary session, it is important for all stakeholders to think about that diminishing and decaying L. Are we doing enough? What role does the civil society have to play here? There is clearly an urgent need for higher expenditure by each of the governments? Can the civil society advocate for this? Who will work towards ensuring that bomb that is ticking doesn’t explode?