Bangladesh’s Deepening Livelihood Crisis: Rising Prices, Shrinking Incomes and Growing Poverty

For millions of Bangladeshis, earning enough to meet basic needs has become an increasingly difficult struggle.

Day labourers, agricultural workers, construction workers, rickshaw pullers and small traders face irregular employment and inadequate earnings, while middle-income families are also struggling with rising food prices, housing costs, medical bills and education expenses.

The result is growing economic insecurity, deteriorating diets and mounting pressure on household budgets.

The warning signs are clear: poverty reduction has lost momentum, inflation continues to erode purchasing power, and decent employment remains insufficient.

Families are borrowing to cover everyday expenses, cutting essential spending and compromising their nutrition. For those living close to the poverty line, illness, unemployment or a natural disaster can quickly turn hardship into destitution.

The World Bank’s Bangladesh Poverty and Equity Assessment 2025 reported that the national poverty rate declined to 18.7 per cent in 2022, from 37.1 per cent in 2010. Yet nearly 62 million people remained vulnerable to falling into poverty after an economic shock.

In October 2026, the WB warned that poverty and inequality had increased during fiscal year 2026, with approximately 2.1 million additional people falling into poverty compared with the previous year. This reversal threatens years of progress.

A 2025 survey by the Power and Participation Research Centre (PPRC), covering 8,067 households, estimated that 27.93 per cent of the population lived below an adjusted upper poverty threshold, while 9.35 per cent fell below the lower threshold.

It also found that the poorest 10 per cent of households earned an average of Tk 8,477 a month but spent Tk 12,294. Although these estimates use different poverty thresholds from official national statistics, they illustrate the financial distress facing the poorest households.

A separate Bangladesh Bureau of Statistics survey conducted in 2025 found that 47.42 per cent of households had borrowed money to meet living expenses.

Average monthly household income was Tk 33,513, against expenditure of Tk 35,311. In rural areas, more than half of households reported borrowing to cover expenses.

When families must borrow to buy food, pay rent or meet medical costs, their financial security deteriorates and their ability to recover from future shocks diminishes.

Inflation remains a major driver of this hardship. According to the BBS, general inflation reached 8.34 per cent in September 2026, while non-food inflation stood at 9.30 per cent.

After several years of price increases, even a slower rate of inflation leaves essential goods expensive relative to many households’ earnings. For people whose wages have not kept pace, purchasing power continues to suffer.

Low-income families spend much of their earnings on rice, vegetables, fish, eggs, cooking oil, transport and housing. Rising costs leave little for healthcare, education or savings.

Middle-income households face similar pressures as salaries struggle to cover rent, school fees, medical bills and other necessities. Many families that previously managed without debt are now increasingly vulnerable to financial shocks.

Food insecurity is particularly concerning. The State of Food Security and Nutrition in the World 2026 estimated that 45.4 million people in Bangladesh experienced moderate or severe food insecurity during 2023–2025. It also estimated that 67.8 million people could not afford a healthy diet in 2025.

These figures highlight a fundamental problem: millions cannot consistently obtain food that is both sufficient and nutritious.

When budgets tighten, families often reduce their consumption of fish, meat, eggs, milk and fruit, relying instead on cheaper staples. Parents may skip meals so their children can eat.

Such compromises can contribute to malnutrition, anaemia and impaired child development. Pregnant women and young children are particularly vulnerable because inadequate nutrition can have lasting consequences for health and learning.

The employment situation compounds the crisis. Bangladesh needs not merely more jobs, but more secure, productive and adequately paid work.

The unemployment rate alone cannot capture underemployment, irregular earnings or the struggles of people who work but still cannot afford basic necessities.

The World Bank’s October 2026 economic update estimated that economic growth slowed to 3.4 per cent in fiscal year 2026.

It also warned that job creation had stalled and women had lost employment. Weak investment and subdued economic activity are adding pressure to the labour market.

Without stronger investment and productive employment, household incomes will remain vulnerable and poverty reduction will be harder to sustain.

Informal workers are particularly exposed. Construction workers lose earnings when projects stop; agricultural labourers face seasonal unemployment; and rickshaw pullers depend on daily demand and their physical ability to work.

Most lack paid sick leave, unemployment benefits and reliable pension coverage. A few days without work can leave a family unable to buy food or pay rent.

Climate change adds to these vulnerabilities.

Floods, cyclones, river erosion, drought and extreme heat can destroy homes, damage crops and interrupt employment. Illness, medical expenses, debt repayments and education costs further weaken household finances. Families with little savings may become trapped in a cycle of borrowing that makes escaping poverty increasingly difficult.

Economic distress can also intensify public frustration and social unrest. When people struggle to secure food, find decent work and meet their families’ basic needs, insecurity deepens and confidence in institutions may weaken.

Economic hardship is not the sole cause of unrest, but persistent livelihood insecurity can aggravate public discontent, particularly when people believe that opportunities and development benefits are distributed unfairly.

Addressing the crisis requires more than temporary relief. The government must strengthen social protection and ensure that assistance reaches low-income workers, vulnerable families, older people and households affected by disasters.

Public employment programmes can provide temporary earnings during agricultural lean seasons while improving rural infrastructure, irrigation and flood protection.

Equally important are policies that encourage productive investment, support small and medium-sized enterprises, improve vocational training and create decent jobs for young people and women.

Fair wages, better working conditions and stronger protection for informal workers are essential. The authorities should also improve market monitoring, promote competition and address unnecessary costs in food supply chains. Affordable healthcare, school meals and maternal and child nutrition programmes can further ease household pressures.

Bangladesh’s development cannot be measured by economic growth and infrastructure alone. Its success must also be judged by whether ordinary people can find decent work, afford nutritious food, educate their children and live with dignity.

When millions remain vulnerable despite years of development progress, making growth inclusive and resilient must become a national priority.

The immediate challenge is to protect livelihoods, restore purchasing power and create decent employment.

No family should have to sacrifice food, healthcare or education simply to survive. Safeguarding people’s economic security and dignity must become a central measure of Bangladesh’s development.

(The writer is the Editor and
CEO of News Network)