# **1. Introduction**

Employment is at the center of multiple debates across South Asia. Are sufficient jobs being created to absorb the numerous young entrants to the labor force? To what extent is economic growth translating into employment growth? Is all employment growth happening in the services sector, or are manufacturing jobs growing too? How many of the jobs being created involve regular wage employment? And is the female share of employment declining with economic development?

If anything, the debate is made more acrimonious by the scarcity of reliable employment data. Highfrequency labor force surveys are still uncommon in the region. Employment data is typically generated out of statistical instruments that are better geared to measuring population, economic activity, poverty or human development. These instruments rely on different definitions of key employment indicators, making comparisons difficult. And often the data is released years after it is collected.

In this paper we try to address these shortcomings by generating comparable employment figures across South Asian countries from 2001 to 2017, out of over 60 primary data sources.<sup>1</sup> We curate the data directly from population censuses, household surveys, and labor force surveys, in a transparent and replicable way. Each individual respondent to these censuses and surveys is classified as employed, unemployed or inactive based on standard labor definitions, matched as closely as possible to the corresponding questionnaires. In addition, we include information on the type of the employment, the sector of activity, and the institutional sector – public or private.

Part of the paper is devoted to explaining in some detail the data harmonization process on which our dataset is built. We also assess differences between the resulting indicators and the readily-available national estimates and model-based estimates reported by the International Labour Organization (ILO). By going into this detail, we hope to reassure readers and potential users about the reliability of the dataset, while at the same time encouraging researchers to further improve it.

The paper also aims to show the usefulness of the dataset to analyze some of the questions recurrently arising in policy debates around the region. In that spirit, we provide a rigorous assessment of the employment characteristics, of changes in employment over time, and of the relationship between economic growth and employment growth in South Asian countries.

Ours is certainly not the first attempt to shed light on employment trends and characteristics in the region. For instance, the World Bank regularly conducts Jobs Diagnostics that discuss labor market issues in selected countries. These multisectoral studies aim at identifying country priorities regarding their labor markets, and often propose policy actions to address them.<sup>2</sup> The World Bank also regularly publishes reports dealing with broader economic issues but touching on employment trends.<sup>3</sup> Other government agencies and international organizations produce similar reports. And numerous academic papers examine specific topics in South Asian labor markets, from the impact of schooling on earnings to youth

> 1  We define South Asia as including Afghanistan, Bangladesh, Bhutan, India, Nepal, Pakistan, and Sri Lanka. The number of observations varies for each country.

> 2  For example, a _Jobs Diagnostic_ for Bangladesh was recently published (Farole and Cho 2017).

> 3  In South Asia’s case, _Development Updates_ have recently been produced for Afghanistan (World Bank 2018b), Bangladesh (World Bank 2018c), Bhutan (World Bank 2018d), India (World Bank 2018e), Nepal (World Bank 2018f), Pakistan (World Bank 2018g) and Sri Lanka (World Bank 2018h).

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