The service sector, which contributes to more than half of the country's gross domestic product, has suffered the most in the Covid-19 pandemic and left 11.22 lakh workers unemployed last year.
The income of those employed in this sector has decreased by 17.6% and they have lost 21.6% working hours.
This sector suffered such a big loss due to a 66-day general holiday and its subsequent failure in making a turnaround.
The Bangladesh Bank quarterly (January-March) report has revealed this information in a review of Covid-19 impacts on the labour market.
Dr Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue (CPD), told The Business Standard that the major sub-sectors of the service sector are transport, tourism, hotels, motels, restaurants, housing, and construction.
"These sectors have been directly affected by the Covid lockdown. Transportation and tourism are still at a loss. So, naturally, Covid's impact in the service sector has increased, which has resulted in a higher number of unemployed and a reduction in income," he added.
Dr Mustafizur Rahman said most of the stimulus given by the government has gone to the productive sector. Again, a large part of the service sector is informal, meaning they are not in the government's accounts. The government will have to provide direct cash assistance to offset their losses.
"For this, we have to make a list. The government has to take up this challenge even though it is a big task to prepare the list," he added.
The economist also said it would be difficult for the service sector to turn around until Covid's prevalence diminished.
He said the government needs to complete the vaccination programme as soon as possible.
Stating that there is no alternative, he said the current strict lockdown is a good initiative but it should be noted that the government needs to reduce health risks only after tackling the risks of food security.
According to the central bank, last year's losses in agriculture and industry were comparatively less than those in the services sector. Although 7.81 lakh people are unemployed in the agriculture sector, the income of those employed in this sector has not decreased but has increased by 1.2%. However, working hours have decreased by 3.8%.
The number of unemployed in the industrial sector is 6.95 lakh, and the income of workers in this sector has decreased by 7.1%.
In this context, Mustafizur Rahman said, many people have left the city and gone to the villages after losing their jobs in the service sector. Again, many of them have joined agriculture. Still, their income did not go up to the level they had while working in the service sector.
The central bank said the various stimulus packages by the Bangladesh Bank at the initiative of the government are helping the economy to turn around.
But a further study is needed to assess the impact of the implementation of stimulus packages targeted for retention of labour markets in a way to ensure an even recovery across the sectors, areas and gender in near future, it added.
The report said the foreign labour market in the pandemic fell to almost zero. On the other hand, more than 4 lakh migrant workers returned to the country from April to December last year. Despite all this, remittance growth in 2020 was 27%.
The central bank has suggested new initiatives to export manpower to foreign markets. Policymakers can take further actions on how to make a convenient environment for migrant workers, it said.
The report also mentioned the study results of various research institutes on the cottage, micro, small and medium enterprise (CMSME) sector, saying that like in the first wave of Covid, CMSME is the most affected sector in the second wave too.
But the central bank believes that the current policy coupled with the stimulus package is enough to turn the sector around.