Importing Workers, Exporting Youth

The full numbers

Youth unemployment (ages 15-24): 28.6% in 2022 — over 70% of youth jobseekers consider overseas work (13th FYP). Simultaneously, the Bhutanese economy issues work permits to foreign workers (primarily Indian, some Bangladeshi) for construction, agriculture, hospitality service, and domestic work. The exact current count is not separately disaggregated in NSB data, but estimates suggest several thousand active foreign workers at any time.

Imagine this

A 22-year-old graduate in Thimphu finishes his degree in business administration. He applies for jobs at half a dozen Bhutanese employers. The pay offered is Nu 18,000-22,000 per month (about USD 250). He considers Australia — where the same role pays AUD 4,000-5,000 per month (about USD 2,700). He applies for an Australian work-study visa. Meanwhile, in the same week, a 30-year-old Indian construction worker arrives in Phuentsholing on a Bhutanese work permit. He will earn Nu 15,000-25,000 per month doing physical labour on a road project — close to what the Bhutanese graduate was being offered for office work, but the Indian worker accepts it because in his home village in Assam the equivalent earning power would be much lower. The Bhutanese youth leaves; the Indian worker arrives. The country loses skilled labour and imports unskilled labour. Neither flow is large, but both are visible.

Where this came from

Several factors converge: (a) Bhutanese youth find domestic wages uncompetitive vs Australia; (b) Bhutanese youth have skills suited to white-collar/services work, but the bulk of domestic demand is for manual labour; (c) foreign workers are willing to do the manual labour at wages Bhutanese youth find unattractive; (d) construction (especially hydropower projects) requires large pools of manual labour that the Bhutanese workforce cannot fully supply at acceptable wages.

Why this matters now

The 13th FYP commits to USD 26B in hydropower expansion through 2040 plus GMC build-out — both labour-intensive. Where will the labour come from? If from foreign workers, Bhutan’s construction sector becomes dominated by Indian labour. If from Bhutanese workers, wages need to rise to make construction work attractive — which the projects’ economics may not support. The current pattern (Bhutanese youth out, foreign workers in) suggests no clear answer.

What it should be

• Productivity per Bhutanese worker needs to rise to the point where Bhutanese can compete domestically.
• Skills-job matching needs improvement — vocational training in construction skills, not just business and IT.
• Wage policies for manual labour need to evolve to keep Bhutanese in those sectors.

How others do it

• Singapore — explicit foreign worker policy with quotas, dependency ratios, and clear separation between citizen labour and foreign labour markets. Many manual jobs done by foreign workers; citizens move to higher-value work.
• Gulf states (UAE, Qatar, Saudi) — extensive foreign worker labour (often majority of workforce). Citizens employed in state sector and high-value private roles.
• Switzerland — small country with significant foreign worker share, but well-regulated and integrated into productive economy.
• Bhutan currently has no explicit foreign worker policy framework calibrated to the migration outflow and construction-sector needs.

The question we should be sitting with

If our youth are leaving to do manual work in Australia and foreign workers are coming to do manual work here — what does that say about our wage structure, our skills training, and our economic design? Is the answer to keep our youth, or to formally accept that we are a labour-importing economy?