Eight in ten Bangladeshi workers have no formal job — and almost every working woman is among them

Introduction

Bangladesh’s economic story is usually told through factories, exports and growth. The labour force survey tells a different one. In 2024, 84.0% of all employed people were in informal employment, according to ILOSTAT estimates based on the national Labour Force Survey.¹ With about 69.1 million people in work, that is roughly 58 million workers without the formal protections, such as a contract, social insurance or paid leave, that define a formal job.²

84.0%

Share of employed Bangladeshis in informal employment, 2024 (ILOSTAT).

Informality is not a marginal problem here; it is the condition of most work. This article sets out who is affected, where informality is concentrated, and what recent earnings data suggest about the cost of it. A note on method: these are survey-based estimates. “Informal employment” follows the ILO’s definition, which counts jobs that lack formal legal or social protection, whether they are in informal enterprises or in formal ones. DEEPLAB’s headcount of informal workers multiplies the 2024 rate by the 2024 employment total and is approximate.

A near-universal condition, especially for women

The informal share has been above 84% in every survey year since 2010. It stood at 86.4% in 2010, climbed to 94.4% in 2017, and was 84.9% in 2022 and 84.0% in 2024.¹ The series was revised in methodology around 2010 and 2013, as the source notes, and the sharp fall between 2017 and 2022 is not explained in the data, so the direction of that change should be read with caution.

The fall was not shared equally. Men’s informal share dropped from 93.5% in 2017 to 78.1% in 2024. Women’s barely moved: 96.3% in 2017 and 96.0% in 2024.³⁴ In 2024 about 96 of every 100 employed women worked informally, against 78 of every 100 men, a gap of 18 percentage points.

Part of the explanation is where women work. In 2024 an estimated 17.2 million of Bangladesh’s 22.9 million employed women, about three in four, worked in agriculture, against about three in ten men (13.6 of 46.2 million).⁵ In farming, informality is almost total: 99.5% for women and 93.5% for men.⁶ The data show this concentration; they do not by themselves show why women are in these jobs.

Where informality runs deepest

Informality is highest where most people work. In agriculture, which employed 30.9 million people in 2024, 96.9% of jobs were informal. In construction (3.7 million workers) the share was 93.4%, and in manufacturing (8.1 million) 86.9%.⁷⁸ Among manufacturing’s women workers, 92.3% were informal, a little higher than the 85.1% for men.⁶

Only a few areas of the economy approach formality. Public administration, which employs about 0.7 million people, had the lowest rate at 19.2%, and education was 48.4%.⁷⁸ Even in wholesale and retail trade, the largest service industry with 8.8 million workers, 54.1% of jobs were informal.⁷⁸

The picture is one of an economy where the formal sector is small in employment terms, even where it is large in output or exports. The source does not break informality down by firm size or by export-oriented factories, so this analysis cannot say how much of manufacturing’s informal employment sits inside the export sector.

What informality costs: earnings

The labour force survey also gives average monthly earnings for employees, which are a narrower group than all workers. These estimates are in current taka and are not adjusted for inflation.

Average monthly earnings of employees rose from 11,229 taka in 2013 to 15,517 taka in 2024.⁹ That is a nominal rise of 15.8% since 2022 (13,403 taka), a period in which consumer price inflation was 9.9% in 2023 and 10.5% in 2024.⁹¹⁰ Compounded, those two years of inflation amount to about 21%, so on these figures average pay rose more slowly than prices. The comparison is approximate: earnings come from a survey and inflation is an annual average, but it points to a squeeze on real pay.

The gap between women and men has widened over the longer run. In 2013 women employees earned 96.7% of what men earned on average (10,953 against 11,331 taka). By 2022 the ratio was 79.1%, in 2023 it was 74.2%, and in 2024 it was 78.6%, with women at 12,635 taka and men at 16,067.¹¹¹² Men’s average earnings rose 42% between 2013 and 2024; women’s rose 15%.

The earnings data do not link pay directly to informality, and employees are only part of the workforce. Many informal workers are self-employed or contributing family workers, who are not covered by this series at all. What the data do establish is that both conditions, a lack of formal protection and slower-growing, lower pay, fall hardest on women.

What it will take

The data point to where the gaps are widest. The following are options for investigation and policy, not proven fixes:

• Publish informality in more detail. Regular, public breakdowns by firm size, export and domestic sector, district and employment status would show which informal jobs are in formal firms, and where extending legal protection is most feasible.
• Extend basic protection beyond the contract. Pensions, injury insurance and maternity benefits that do not depend on a formal employer would reach the 58 million workers outside the formal system.
• Look at farm work first. With 31 million people and 97% informality, agriculture is where any broad improvement in social protection would be largest, and where three in four working women are.
• Track the gender pay gap. An annual published gap by industry, occupation and education, using the survey, would separate differences in jobs from differences in pay for the same work.
• Monitor real wages. Report earnings adjusted for inflation each year so that nominal increases are not mistaken for gains in living standards.
• Resolve the series break. Ask the Bangladesh Bureau of Statistics to explain the 2017–2022 change in measured informality, so that trends can be relied upon.