DHAKA -- Bangladesh is stepping up cooperation with China on technical and vocational education to equip workers with job-ready skills as thousands of the South Asian Nation's graduates struggle to find employment in an increasingly competitive labor market.

The two countries have agreed to modernize eight technical education institutions in Bangladesh, establish a joint technical and technological university, and introduce various joint training programs under a memorandum of understanding signed on Oct. 17.

"The government plans to draw on global best practices, including China's experience in linking industry with academia, to strengthen technical skills, build institutional capacity and expand employment opportunities," Mahdi Amin, the education adviser to the Bangladeshi prime minister, told Nikkei Asia. "Our priority now is to translate the agreement into concrete action and create meaningful employment opportunities for young people." For years, Bangladesh's graduate job market has offered little hope to the country's youth, contributing to the frustrations that led to the student-led uprising of 2024 that brought down former Prime Minister Sheikh Hasina's government.

The country's higher education institutions produce hundreds of thousands of graduates each year, but predominantly in arts and humanities, social sciences and business studies rather than the vocational fields employers are looking for. Data from the Bangladesh Bureau of Statistics' 2024-25 information technology survey showed that nearly half of university graduates had never used a computer.

Many graduates struggle to find appropriate work or even any job at all -- 36% of educated young Bangladeshis are unemployed, according to the International Monetary Fund. Every year, over 750,000 new graduates come into the market, but fewer than 200,000 new graduate jobs are created, according to Fahim Mashroor, CEO of Bdjobs.com.

But for those that do attend a vocational school, government data shows that 42% of learning is focused on basic computer literacy, even though such institutions are supposed to impart practical, job-ready technical skills in areas such as manufacturing, electrical engineering and automotive services. Concerns over the level of education have been heightened by industries' moves toward artificial intelligence, automation and advanced digital tools.

A study by the Bangladesh Institute of Development Studies found that 40% of positions in the information technology sector remain vacant because of skills shortages, despite around 10,000 IT graduates entering the job market each year.

"The roots of Bangladesh's youth unemployment crisis lie in a long-standing mismatch between education and labor market needs," said Fahmida Khatun, distinguished fellow at the Centre for Policy Dialogue. "The education system continues to prioritize academic qualifications over practical, job-ready skills, leaving many graduates without the competencies employers require."

"Bangladesh's cooperation with China could help reduce skills mismatches through practical, digital and work-based training," Khatun continued. "Modernizing the eight institutions and introducing joint programs could help graduates meet employers' needs. Internships and regular consultation with businesses will be essential." Hannan Hossain, who completed his master's degree in sociology at Jagannath University in Dhaka three years ago, is among those struggling to secure a foothold in the job market. He now relies on providing private tutoring to make ends meet.

"Finding a job is extremely difficult in such a competitive market. Thousands of candidates compete for a single government job," he said. "My parents, who live in a village and depend on me, are increasingly disappointed that I have yet to find work. I feel frustrated and uncertain about my future." The Bangladesh China Chamber of Commerce and Industry has proposed that the government add a further 20 technical and polytechnic institutes to the roughly 115 that it already runs. BCCCI President Mohd. Khorshed Alam envisages cooperation with China that could help young people develop skills in manufacturing, from vehicle parts to toys, while also preparing for technological developments in Bangladesh's key garments sector.

"AI is replacing human workers in fashion and design tasks. In China, around 80% of fashion-related work in the garment industry is being done by AI. Bangladesh is heading in the same direction, so we need to act now," Alam said. "Otherwise, joblessness could rise further in the future." To address these employment challenges, Bangladesh is working to widen students' opportunities for employment and higher education abroad. The government plans to introduce language courses in schools and universities, with Japanese, Arabic and French under consideration. Mandarin Chinese is regarded as a priority, however, as the government aims to establish direct partnerships between Bangladeshi polytechnics and technical institutions and leading Chinese industries to expand practical training, strengthen capacity building and create employment opportunities.

"China's experience can help Bangladesh address its skills gap and graduate unemployment. However, I think we should send more students to China rather than focus solely on setting up institutions with Chinese assistance," said BDjobs.com's Mashroor. "The cost of providing technical training to a student in Bangladesh is around 300,000 taka ($2,400). With the same amount, a student could be sent to China for two to three years of training."

Khatun agreed that the government can't solely focus on domestic educational opportunities.

"Training alone cannot create enough jobs. Bangladesh also needs higher private investment, a predictable business climate, export diversification and growth in manufacturing and modern services," she said.

Kaniz Fatima is a contributing writer.