Friday’s blowout jobs report may have quieted claims that the U.S. is in a recession, but it did not end the mystery about the state of the economy or resolve questions about where it is headed.
- Bangladesh is growing rapidly due to smart use of technology to drive a digital transformation.
- The digital inclusion strategy aims to promote the uptake of mobile money.
- Technology is improving the accessibility, quality and affordability of health services.
Bangladesh is continuing its strong development trajectory, marching ahead of other South Asian countries in terms of its ranking on the Inclusive Development Index (IDI), GDP growth rate, and other human development achievements.
The current government’s efforts to use technology to reduce poverty, and transform the lives of the general population in Bangladesh has played a key role in this growth. The government recognizes digital inclusion as the only way to facilitate rural economic activities, and enable rural workers to capture a larger piece of the economic pie. The government very carefully designed digital services to ensure they are relevant for all three groups of Bangladeshi citizens: digital natives – younger, tech-savvy, generations growing up with technology; digital adapters – middle-aged individuals who have adopted technology; and outliers – the minority who stay away from technology.
The government has made a concerted effort towards achieving the Digital Bangladesh Vision by 2021, marking the 50th anniversary of Bangladesh’s independence. The Digital Bangladesh philosophy of the Prime Minister Sheikh Hasina is to protect people’s democracy and human rights, ensure transparency and accountability, establish justice, and ensure delivery of government services to the citizens of Bangladesh through maximum use of technology, with the ultimate goal being the overall improvement of the daily lifestyle of the general population.
The Government has been proactively pursuing the digital penetration of all government portals by the year 2023. The country developed the National Portal in 2014, which now houses over 45,000 websites and services of different government offices, with about 60 million hits a month on average.
Over 5,000 Digital Centres have been set up across the country to cover the “last mile” and ensure the various digital services reach all citizens, addressing the issue of the digital divide. To ensure interoperability, the Bangladesh National Digital Architecture was established.
Digital services like Smart NID, the biometric database of unique IDs, fingerprints and iris scans has been successful in making citizen services run more smoothly, and negating problems like fake IDs and impersonation.
We have issued over 100 million digital IDs to our citizens, which is one of the highest in the world. Machine readable e-passports were launched early this year to enable faster immigration processes, greater accuracy, and better data matching against immigration databases and watch lists.
The “My Village My Town” initiative is one of the notable examples of the Prime Minister’s bottom-up vision. Under the initiative, modern city amenities are being expanded to every village of Bangladesh. For the first time in the history of Bangladesh these marginalized people have been recognized as the centre of economic activity.
Public spaces and urban services are being designed to make cities more inclusive for women and groups of people with special needs. Digital services, access to information and technical and vocational training for less privileged women have been playing a major role in empowering them.
As part of the Digital Island initiative, Moheshkhali, a remote and impoverished island of Bangladesh has been turned into the nation’s first “Digital Island”. The government connected Moheshkhali to the mainland by 14 miles of fibre optic cable and also established an e-commerce centre for the artisans of Moheshkhali to sell their products and earn a living. The island will soon be home to a sea port and power plants.
The government plans to replicate this on other remote islands that dot the country’s Bay of Bengal coastline. Fibre optic connectivity has been established, providing high speed Internet connectivity. The government plans to roll out the fifth-generation cellular network technology (5G) in Bangladesh by 2021, ensuring faster and more reliable internet coverage across the country.
A key component of the government’s digital inclusion strategy is to promote the uptake of mobile money and other digital payment platforms. Efforts are being made to boost the popularity of Mobile Financial Services (MFS) to ensure higher penetration at the bottom of the pyramid.
In recent years, MFS has made a significant impact on reducing the unbanked population, rural-urban capital flow, and growth of online e-commerce transactions. In the last five years, growth of mobile financial services in Bangladesh has skyrocketed, with bKash leading the way. In 2018, registered users of Non-Banking Financial Institutions (NBFIs) were more common among the rural poor than among the adult population as a whole. Mobile money transfers were the most popular digital use case in Bangladesh and uptake of mobile money transfers was three times greater than bank transfers.
Digital health services, including telemedicine, have already been effective in health services delivery as well as diagnostic, promotive and preventive measures. From the private sector, many digital health service startups have come up with innovative solutions including remote diagnostic capabilities, cloud-based health monitoring systems, web portals that disseminate basic health information, etc., to help bridge shortages of trained medical professionals in rural areas.
The country initiated a National Digital Health Strategy last year as an essential step for using technology to improve the accessibility, quality and affordability of health services. The digital health strategy will provide direction for efforts to use digital technologies in a more coordinated way to further strengthen the health system.
The government is implementing a number of mega projects to establish an integrated and uninterrupted communication network in the country. To capture manufacturing investors from home and abroad, the government has taken the initiative to establish 100 special economic zones and 28 IT parks in various parts of the country; many of these are already operational or under construction. These economic zones and IT parks will play an effective role in improving the employment and quality of life of people in every region of the country.
Bangladesh has experienced tremendous growth in the last decade under the leadership of our Prime Minister Sheikh Hasina and her ICT Adviser Sajeeb Wazed. Today, we experience nearly 8% GDP growth, as one of the fastest growing economies in the world. Bangladesh was ranked 34th in the WEF’s Inclusive Development Index, 2018. By 2030, Bangladesh is projected to become the 24th largest economy in the world. The key factor behind this growth has been smartly utilizing ICT to spur growth in all sectors.
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Charting the Global Economy: Job Growth in US Powers Ahead – BNN
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The strongest US job growth in five months and firmer-than-expected worker pay assuaged recession concerns, while also helping clear the path for the Federal Reserve to continue large interest-rate hikes.
In Europe and Asia, factory production weakened on lingering supply-chain constraints that are contributing to persistent price pressures. The Bank of England stepped up its inflation fight with the biggest rate increase in more than a quarter century, while also cautioning that the UK is headed for more than a year of recession.
Here are some of the charts that appeared on Bloomberg this week on the latest developments in the global economy:
Central banks around the world continued raising interest rates this week. Australia, Brazil, India and the UK were among those hiking by 50 basis points, while Romania went for 75 basis points and Madagascar for 90 basis points.
The standoff between the US and China over Taiwan has thrown a spotlight on growing risks to one of the world’s busiest shipping lanes — even a minor disruption could ripple through supply chains. Almost half of the global container fleet and a whopping 88% of the world’s largest ships by tonnage passed through the Taiwan Strait this year, according to data compiled by Bloomberg.
European factory activity plunged and Asian manufacturing output continued to weaken in July amid lingering supply-chain complications and a slowing global economy. Purchasing managers’ indexes for the euro area’s four largest members all indicated contraction, while China, South Korea and Taiwan took the biggest hit in Asia.
Employers added more than double the number of jobs forecast, illustrating rock-solid labor demand that tempers recession worries and suggests the Federal Reserve will press on with steep interest-rate hikes to thwart inflation.
Household debt increased by 2% to $16.2 trillion in the second quarter, with mortgages, auto loans and credit-card balances all seeing sizable jumps, according to a report by the Federal Reserve Bank of New York.
With almost two openings for every person looking for work, US companies are increasingly tapping high school students for skilled jobs. As a result, apprenticeships are seeing a renaissance after failing to gain a foothold over the past few decades.
The Bank of England unleashed its biggest interest-rate hike in 27 years as it warned the UK is heading for more than a year of recession under the weight of soaring inflation. The half-point increase to 1.75% was backed by eight of the bank’s nine policy makers, who also kept up a pledge to act forcefully again in the future if needed.
German factory orders sank for a fifth month in June as rampant inflation and global supply disruptions continued to weigh on the outlook in Europe’s largest economy.
Germany’s presidential palace in Berlin is no longer lit at night, the city of Hanover is turning off warm water in the showers of its pools and gyms, and municipalities across the country are preparing heating havens to keep people safe from the cold. And that’s just the beginning of a crisis that will ripple across Europe.
It’s 2025 in Beijing, five years since the start of the pandemic, and Chinese President Xi Jinping’s Covid Zero policy is still an inescapable part of daily life. As omicron sub-variants become ever-more infectious, Xi’s resolve to avert virus fatalities is growing stronger – leading many experts to warn that Covid Zero could continue well beyond 2022.
Major South Korean firms are agreeing to the biggest pay rises in 19 years, according to a government survey, fueling concerns that a wage-price spiral is taking hold in the economy. Salary agreements at companies with 100 workers or more climbed 5.3% in the first half of the year, exceeding every increase since 2003, a labor ministry poll showed.
Turkish inflation accelerated again and may be months away from peaking, soaring to levels unseen since 1998 as the central bank sticks with its ultra-loose monetary course.
Brazil’s central bank raised its key interest rate by half a percentage point and left the door open for a smaller boost in September as it shifts its focus to the outlook for inflation more than a year ahead.
©2022 Bloomberg L.P.
The economy is growing by one measure, shrinking by another – The Washington Post
Government data showing the economy had contracted for the second consecutive quarter — meeting one informal definition of recession — was still fresh, as the Labor Department on Friday said employers had added 528,000 jobs in July. That was more than twice as many as economists expected.
Only eight days separated the two government reports, yet they seemed to describe entirely different realities.
The first showed a weak economy that — coupled with the highest inflation in 40 years — offered consumers nothing but grief. The second reflected a juggernaut that was minting jobs faster than workers could be found to fill them, with an unemployment rate that matched the pre-pandemic low of 3.5 percent.
“It’s normal for different economic indicators to point in different directions. It’s the magnitude of the discrepancies right now that’s unprecedented,” said Jason Furman, formerly President Barack Obama’s top economic adviser. “It isn’t just that the economy is growing in one measure and shrinking in another. It’s growing incredibly strongly in one measure while shrinking at a pretty decent clip in another.”
In Washington on Friday, President Biden took a victory lap for the job growth while claiming credit for gas prices having declined for more than 50 consecutive days. Yet he also acknowledged the disconnect between the sunny employment report and the inflation headaches that afflict many households.
“I know people will hear today’s extraordinary jobs report and say they don’t see it, they don’t feel it in their own lives,” the president said, speaking from a White House balcony. “I know how hard it is. I know it’s hard to feel good about job creation when you already have a job and you’re dealing with rising prices, food and gas, and so much more. I get it.”
The surprisingly robust jobs number seemed to call into question the president’s argument that the economy is undergoing a “transition” from its faster growth rates last year to a slower, more sustainable pace.
No one expects the economy to continue producing half a million new jobs each month. No one thinks it could without inflation remaining at uncomfortable heights.
Almost five months after the Federal Reserve began raising interest rates to cool off the economy and to bring down the highest inflation since the early 1980s, the labor market report showed that the nation’s central bank has more work to do. Average hourly earnings for private sector workers rose by 5.2 percent over the past year, which hints at the sort of wage-price spiral that the Fed is determined to prevent.
Last month, the Fed lifted its benchmark interest rate to a range of 2.25 percent to 2.5 percent, its highest level in almost four years. Yet in “real” or inflation-adjusted terms, borrowing costs remain deeply negative, which acts as a spur to economic growth.
Fed Chair Jerome H. Powell said last month that additional rate increases are likely when policymakers next meet on Sept. 21. The size of the next increase – either half a percentage point or three-quarters of a point – will “depend on the data we get between now and then,” he told reporters.
Investors see a 70 percent chance of the larger move, according to CME Group, which tracks purchases of derivatives linked to the central bank’s key rate.
On Wednesday, the government is scheduled to release inflation readings for July, which are expected to show a modest improvement compared to June’s 9.1 percent figure, thanks to falling energy prices.
Powell’s decision to stop telegraphing Fed moves by providing “forward guidance” of its plans is itself a sign that the current environment is murkier than usual.
“A lot of what’s happening in this economy is being driven by the pandemic, and then the pandemic response. And so, we are in a very unusual time, in many ways [it’s] challenging to sort of read through those data,” Loretta Mester, president of the Federal Reserve Bank of Cleveland, and a voting member of the Fed’s rate-setting committee, told The Washington Post this week.
Almost 22 million Americans lost their jobs between February and April of 2020 in covid’s first months. The unemployment rate hit 14.7 percent, the highest figure recorded by the Labor Department in a series that began in 1948.
With July’s gains, the economy now has recovered all of the lost jobs.
But the workforce has been reshaped. There are more warehouse and logistics workers today and fewer employees working for hotels and airlines.
Employers are reacting differently than they did before the pandemic to indications that the economy may be slowing, according to Gregory Daco, chief economist for EY-Parthenon. Rather than immediately resorting to significant layoffs, they are instead scaling back hiring or engaging in targeted job cuts.
Weekly first-time unemployment claims are up, but only to 260,000 from their 54-year low of 166,000 in March.
Consumers have also acted differently, buying more goods than normal while trapped at home during the pandemic’s initial wave. Retailers that ordered unusual volumes of furniture, electronics and apparel from overseas suppliers later misjudged the pace of consumers’ return to traditional buying patterns, leaving stores stuffed with unwanted goods.
On top of the pandemic’s lingering ills, the war in Ukraine has disrupted global commodity markets, contributing to higher inflation.
All of these forces combined to produce economic data that is unusual and sometimes contradictory. Friday’s jobs report showed 32,000 new construction jobs and 30,000 new factory jobs created in the month. Yet housing starts have fallen for the past two months and the latest ISM manufacturing reading was the weakest in two years.
“We are in somewhat of a dizzying business cycle. We’re getting economic data that is fluctuating quite rapidly and it’s very hard to get a precise read on where the economy is at any point in time,” Daco said.
Individual data points also provide snapshots of the economy that are out of sync, said Kathryn Edwards, an economist at the Rand Corp.
Friday’s Labor Department report tallied up jobs gained in July. The last consumer price index reading covered June. And the gross domestic product reading that started the recession furor described activity that occurred between April and June – and will be revised twice.
“It’s a challenge for an economist, but also for a reader who wants to understand how at risk they are for an economic downturn,” she said.
Labor market and output data have been telling different stories about the economy all year. After six straight months of shrinkage, the economy is roughly $125 billion smaller than it was at the end of 2021, according to inflation-adjusted Commerce Department data.
Yet employers have hired 3.3 million new workers over that same period.
How could more workers be producing fewer goods and services?
One explanation is that workers are less productive today than during the emergency phase of the pandemic, when companies struggled to keep producing their required orders with fewer workers, Furman said.
Indeed, non-farm business productivity in the first quarter fell 7.3 percent, the largest decline since 1947, according to the Bureau of Labor Statistics. Preliminary results for the second quarter will be made public on Tuesday and are likely to show the largest two-quarter drop in history, he said.
Those figures may overstate the change. During the pandemic, companies may have been able to maintain output with a covid-thinned workforce by exhorting or incentivizing the remaining workers to work harder or longer. But there is a limit to how long bosses can motivate people by citing emergency conditions.
“They worked extra hard, but they wouldn’t work extra hard forever,” Furman said.
Likewise, the labor force participation rate usually rises when employers are adding jobs and the unemployment rate is falling. But since March, it has fallen, according to the Bureau of Labor Statistics.
Some Americans retired instead of risking working during the pandemic. Others — mostly women — who lacked adequate child care, stayed home with young children or other vulnerable relatives.
An April paper by economists at the Federal Reserve Bank of Richmond found that “the pandemic has permanently reduced participation in the economy.”
Participation by Americans in their prime working years, ages 25 to 54, has almost entirely recovered. But for those 55 and older, there has been almost no improvement since the initial plunge at the outset of the pandemic. And for younger workers, age 20 to 24, participation is lower now than at the end of last year.
“I don’t think we have a great handle on why other workers are not coming back,” said Kathy Bostjancic, chief U.S. economist for Oxford Economics. “It’s just such an unusual period.”
Canadian economy sheds jobs for second straight month – BNN
Canada’s economy lost 30,600 jobs in July, according to data from Statistics Canada on Friday. This marks the second consecutive month of employment losses for the country.
The data came in weaker than expected. The median estimate among economists tracked by Bloomberg was for a gain of 15,000 jobs last month and an unemployment rate of 5.0 per cent.
The country’s unemployment rate remained steady at a historic low of 4.9 per cent.
The wholesale and retail trade, health care and social assistance, and educational services sectors collectively saw a loss of 53,000 jobs. The losses were partially offset by the goods-producing sector which gained 23,000 jobs, the labour force survey revealed.
The decline in jobs was roughly the same in both part-time and full-time work, though employment fell the most among women aged 55 and over.
The overall participation rate fell 0.2 per cent to 64.7 per cent in July, compared to the 0.4 percentage point drop in June.
The average hourly wages of employees rose 5.2 per cent on a year-over-year basis, matching the pace set in June.
“This is a notoriously noisy survey, especially in the summer months, July and August. The numbers bounce around a lot. I think what’s important here is that the North American economies are slowing,” Philip Cross, a senior fellow at the Macdonald-Laurier Institute and a former chief economic analyst of Statistics Canada, said in an interview Friday morning.
He also cautioned that Canada’s housing sector is vulnerable to the rising interest rate environment and could lag behind the U.S.
“There are some pockets of resilience in the economy. The resource sector is one,” Cross said.
The Bank of Canada has attempted to rein in runway inflation with aggressive interest rate hikes. Friday’s jobs data will likely help inform the central bank’s next scheduled interest rate decision in September.
“While today’s figures muddied the waters further for policymakers, the Bank of Canada will likely focus on the historic low unemployment rate and still strong wage growth to justify another non-standard rate hike at its next meeting,” Andrew Grantham, a senior economist at CIBC Capital Markets, wrote in a note to clients on Friday.
The Bank of Canada remains committed to reaching its target rate of two per cent inflation.
“Evidence that the economy is slowing due to weakening demand, rather than supply constraints, will bring a pause in this rate hike cycle following the next hike,” Grantham said.
Heat warning still in place for large swaths of central and eastern Canada
Investment industry faces widening skills gap around big data and ESG – The Globe and Mail
Many federal government employees balking at returning to offices – CBC News
Silver investment demand jumped 12% in 2019
Europe kicks off vaccination programs | All media content | DW | 27.12.2020 – Deutsche Welle
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