Pandemic doubled unemployment rate but a fight back is on

The State of The Nation report (SOTN) emphasized on how the COVID-19 pandemic has impacted the unemployment rate in the country.

The impact was immediate and widespread, and worsened by layoffs, new entrants into the labor market and overseas returnees. Moreover, the closure of businesses, both temporary and permanent, rendered many individuals jobless, whereby the government’s focus on investing in ideas and creating employment opportunities has been minimal.

The unemployment rate almost doubled in 2020 from 2.7% in 2019 to 5% in 2020 with youth unemployment jumping from 11.9% in 2019 to 22.6% in 2020. Besides unemployment, there has been no review on the issues of underemployment and underpayment despite the inflation and increasing burden of high rental costs, SOTN added.

SOTN states, “The sharp decline in economic output would have translated into a far worse scenario, had it not been for His Majesty The King’s leadership and timely interventions. The Accelerated De-Suung Integrated Training Programme absorbed a huge number of youths who were either unemployed or displaced because of the pandemic.”

7,922 individuals were trained in the general category under the program and 3,947 were trained for water management.

The report further states that the expanded opportunities under the Economic Contingency Plan, which was started right after the pandemic, has engaged 1,300 individuals in tourism and 930 under the Build Bhutan Project (BBP).

“With a number of interventions in place to counter the impact of COVID-19 on unemployment, the unemployment rate is expected to remain within 3 to 5 percent in the medium term. Much of the focus is also on preparing for the new jobs and industries that define the post-pandemic period,” the report adds.

In line with this, TVET is expected to play a critical role in nurturing a smart and knowledgeable workforce, ready for the 21st century economy. A TVET Policy was finalized in June 2021. It is designed to reform the TVET system to create a work-ready and future-ready workforce.

The labour ministry has designed and launched Skills Development Plan in October this year to mitigate the socio-economic impact caused by the pandemic and ensure an effective, inclusive and sustainable recovery.

This came into place after the His Majesty commanded the ministry to diversify opportunities through skills training for the unemployed and those affected by the pandemic on 31 May this year. The intent was to meaningfully engage the trainees and enable them to contribute to the socio-economic development post pandemic.

“The plan targets individuals by supporting them through relevant skills training. In phase one, the ministry has identified 21 courses in sectors of tourism, agriculture, ICT, traditional arts, manufacturing, construction, electrical, mechanical and business services. Under these, 95 of the 266 individuals have been trained,” the SOTN highlighted.

The Department of Employment and Entrepreneurship has initiated ‘Gowa’, a monthly event to orient the youth towards crucial information pertaining to the labour market. The ministry has also established 46 specialized firms through BBP.

The firms are currently operating in the market, whereby 350 Bhutanese youth workers are employed.

Furthermore, after the inception of BBP in July 2020, the report shows that BBP has employed 1,973 individuals under the project. The five TTIs have been giving foundational courses in seven construction related trades. So far, the TTIs have trained over 1,117 people.

Under the CSI flagship, 508 youth were trained on entrepreneurship.

There are two business incubation centers located at Jigme Namgyel Engineering College and Sherubtse College, and as of now, 87 new startups have begun operation, creating 150 employment opportunities.

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