Female Labor Market Participation in Bangladesh: Structural Changes and Determinants of Labor Supply

Abstract

Bangladesh has experienced moderately sustained economic growth (annual GDP growth of 6–7%) over the past two decades, as well as a fairly rapid demographic transition that began earlier, leading to sustained and steep declines in fertility levels and mortality rates. An accompanying feature of these socioeconomic trends has been the rising participation of women in the labor market, with the female labor force participation expanding from around 8% in the mid-1980s to 30% in 2010. While rising female labor force participation in Bangladesh denotes progress for women in a relatively conservative society, and has significant implications for economic growth and poverty alleviation of the country, there remain critical aspects that need examination. First, women’s workforce participation is still very low compared to men’s, despite the fact that women attach value to having their own independent incomes. Moreover, compared to men, women remain locked into fewer sectors and types of activities that offer fewer hours of employment and lower remuneration. Often, women have little choice but to contribute as unpaid labor to the family enterprise. Second, and related to the first, is that increase in formal school enrolment, better health, lower burden of childbearing (more time) are not translating into secure full-time employment, indicating that expansion in participation is supply driven rather than demand driven. Hence, female labor market participation and its dimensions deserve an in-depth analysis from both an academic point of view and also from a policy perspective. In this paper, we attempt to examine the change over time in the nature of the female workforce and to identify factors affecting the labor supply decision of women in Bangladesh using Labor Force Survey data of several rounds (2005 and 2010 in particular) conducted by the Bangladesh Bureau of Statistics.