Looking to the future: Ensuring better job opportunities for Tajikistan’s youth

The World Bank
Mohamed Ihsan Ajwad, Victoria Strokova

A significant share of Tajikistan’s workforce works outside the country. Photo: Gennadiy Ratushenko / World Bank

My colleague Victoria and I had an opportunity recently to meet with students at the Tajik-Russian Slavonic University in Dushanbe, Tajikistan, as part of our research and preparation for a new report called Tajikistan Jobs Diagnostic: Strategic Framework for Jobs.

Curious to learn about their future professional ambitions, we asked one class of students how many of them would like to work in the private sector after they graduate. Only about 10% of the students raised their hands. We also asked them how many would like to work for the government. This time, around 20% raised their hands.

Honestly, we were quite surprised at the low showing of hands, and it begged the question: What were these future university graduates actually planning to do? We were told that, after graduation, about 70% of the students are planning to migrate abroad to find work.

"Isn’t that a rather large percentage?" we thought. Yes, but as it turns out, a significant share of Tajikistan’s workforce – including, by some estimates, one-third of men aged 20 to 39 years – actually works outside the country. The majority (about 90%) of these migrants work in the Russian Federation – mainly in the areas of construction, trade, housing and maintenance services, and agriculture.

Remittances from migrant workers abroad play a hugely important role in Tajikistan’s economy, making up almost 30% of GDP, and in recent years have helped to significantly reduce poverty. During the period 1999 to early 2014, poverty fell from over 80% to about 31.3%.

However, the recent economic slowdown in Russia has had a significant impact on the income of Tajik households. And it has also ignited a debate in the country about developing an effective “domestic jobs strategy”.

Tajikistan, with one of the fastest growing populations in the Europe and Central Asia region, urgently needs to accelerate the pace of domestic job creation. And, not only that: many of those new jobs need to be higher quality jobs.

Of all employed in the country, 39% work as wage employees in the informal sector – without an employment contract and without making social security contributions. An additional 18% are unpaid workers, who usually comprise family members engaged in the family farm or business.

Formal wage employment in the private sector makes up only 13% of total employment, and the number of newly registered businesses per 1,000 working-age people is one of the lowest in Europe and Central Asia.

Interestingly, a recent study by some of our colleagues called Back to Work: Growing with Jobs in Europe and Central Asia finds that almost 40% of the labor force in Tajikistan has a preference for self-employment – although the share of those interested in entrepreneurship and who actually took steps to start a business is only 11.8%.

But, thinking back now to the university students we met in Dushanbe — who will soon be faced with making decisions about entering the labor market in Tajikistan or going abroad — what can be done to help them and other young people looking to get a job at home?

To answer this question, we present three broad recommendations in our report, summarized below:

First of all, Tajikistan could do more to promote private sector growth. Ensuring that the macroeconomic fundamentals are in place, further improving the business environment and governance, promoting trade, expanding access to finance, and improving investment policy coordination are all key to boosting the private sector.

Secondly, more can be done to promote productivity and earnings, and to increase access to formal sector jobs. It is important to invest in local value chains, especially those that support rural small and medium enterprises (SMEs), and to incentivize formal job creation, for example, by ensuring that the tax system does not discourage formalization.

Thirdly, there needs to be a focus on connecting jobseekers to jobs. Here, a number of policies are worth considering: doing more to increase labor force participation by improving access to childcare, and to early childhood development; using the education and training system to improve the skills of the current and future labor force; using labor market policies to improve access to jobs, especially for youth and women; and leveraging migration and remittance incomes, which is an important jobs strategy for households.

All of that said, we do recognize that the jobs agenda is huge and complex, and requires the involvement not only of the Government of Tajikistan, but also of the private sector, NGOs, donors, and yes … youth!

Those bright young students at the Tajik-Russian Slavonic University have already helped to shape the jobs debate, and we suspect that going forward they will do so even more, if given the right opportunity.