Ashiq Ahmed, 27, has a degree and no formal job. He passed post-graduation in political science four years ago; still, he is looking for a decent job. But he is not getting it. He has worked as a salesman, at a little-known regional company, and in a small shop to support his family.
Ashiq is not alone. Lakhs of young Bangladeshis are in the same position, and the World Bank, in its latest report, says time is limited. According to the Labour Force Survey, some 22 lakh people enter the workforce every year. Around 40% are educated youth and most of them fail to get a formal job.
The WB report also reflects this issue. About 80% of prime-age workers are in informal jobs, and informal workers earn far less than formal ones.
The report says Bangladesh’s working-age share of the population is projected to peak in 2045, later than India’s 2034 but earlier than many assume. Economists call this the “demographic dividend”: the period when more people are working than are dependents.
The report says small firms in Bangladesh shed workers on average, while employment in medium-sized firms shrank.
By 2050, the report projects more people available to work than needed to maintain a ratio of 2.5 workers per older adult, raising the risk that job creation falls short.
Titled “Demographic Change in South Asia: From Tailwinds to Headwinds for Development”, the report was launched at the Pan Pacific Sonargaon Hotel in Dhaka today (3 November). Franziska Lieselotte Ohnsorge, WB chief economist for Asia, presented the keynote address.
Rapid ageing threatens demographic dividend
Bangladesh’s demographic window of opportunity is expected to peak around 2045, while the country is projected to transition from an ageing to an aged society within just 24 years, creating significant economic, social and healthcare challenges, the WB says.
The report warns that Bangladesh has a limited period to capitalise on its growing working-age population by creating productive jobs, improving skills and increasing labour force participation, while building financial and healthcare support systems for its rapidly ageing population.
This extended demographic window offers an opportunity to accelerate economic growth through higher employment, improved skills and greater labour market participation, it says.
However, the transition to an ageing society is expected to begin in 2027, when people aged 65 and above will account for 7% of the population, says the WB. By 2051, their share is projected to reach 14%, marking the country’s transition to an aged society, it says.
The pace is considerably faster than in developed economies, the report says.
Demographic dividend gradually declining
According to the report, changes in Bangladesh’s age structure contributed approximately 0.4 percentage points annually to per capita GDP growth between 2000 and 2024.
However, this contribution is projected to decline to 0.2 percentage points annually between 2025 and 2044 before turning negative from 2045.
Old-age financial security remains weak
Financial security among older people remains precarious, with limited pension coverage, inadequate social protection and high healthcare costs, says the WB.
According to illustrative figures from 2018 cited in the report, only 3% of adults in Bangladesh reported saving specifically for old age. Although social pensions cover around half of the older population, the benefits remain insufficient to ensure adequate financial security.
Informal employment threatens demographic dividend
According to the report, structural weaknesses in the labour market could prevent Bangladesh from fully benefiting from its demographic window.
Although employment among the working-age population is higher than the South Asian average, it remains below the average for other emerging market and developing economies. The gap is particularly pronounced among women and in non-agricultural sectors.
Around 84% of employment in Bangladesh is informal, limiting workers’ access to job security, social protection and retirement benefits.
Healthcare challenges and the silver economy
According to the WB, Population ageing is expected to create new opportunities in healthcare, elderly care and other services catering to older consumers, commonly known as the silver economy.
However, the gap between life expectancy and healthy life expectancy in Bangladesh remains around 10 years, meaning many people spend a substantial part of their later lives dealing with illness and health limitations.
Demographic transition a wake-up call for urgent reforms: Experts
In a panel discussion, Hossain Zillur Rahman, executive chairman of Power and Participation Research Centre, described Bangladesh’s demographic transition as a major wake-up call, warning that the country has a limited timeframe to address emerging social and economic challenges. He stressed that healthcare, education and employment must be treated as interconnected priorities rather than isolated sectoral issues.
Nazneen Ahmed, executive director of the Centre for Policy Dialogue, called for greater investment in practical skills, entrepreneurship and workplace training rather than relying solely on expanding higher education.
She also urged policies to improve women’s employment through childcare and safe transport, while extending social protection and pension coverage to informal and gig-economy workers.
Cem Mete, regional practice director, WB, emphasised the urgency of preparing Bangladesh for its demographic transition, warning that the country has less time than many other nations to establish the necessary social protection and pension systems.
Social Welfare Minister Abu Zafar Md Zahid Hossain said Bangladesh must mobilise its large population as a national resource while preparing for the challenges of demographic transition.
Zonayed Saki, state minister for planning, said the government is adopting a full life-cycle policy approach, covering people from childhood to old age, to address the challenges of demographic transition.
Recommendations
The WB recommends pursuing two policy priorities simultaneously: maximising the remaining demographic dividend and preparing institutions for an ageing society.
Bangladesh needs to generate more productive jobs, increase women’s participation in the labour market, improve education and skills, strengthen healthcare and harness emerging technologies, including artificial intelligence.
At the same time, it must develop stronger pension and social protection systems, promote healthy ageing, extend productive working lives and improve long-term care services.
The report also highlights the importance of early childhood nutrition and development, labour mobility, effective social protection and stronger fiscal capacity to mobilise public and private financing.
With its demographic window expected to peak around 2045 and the transition to an aged society projected to be completed by 2051, Bangladesh has a narrowing opportunity to turn its favourable population structure into sustainable economic growth while preparing for the needs of an older population.
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