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A comprehensive analysis of challenges, opportunities, and the path forward for Nepal's workforce
Nepal's labour landscape presents a complex picture of challenges and opportunities in 2024. With a total labour force of 8.43 million people representing only 39.75% of the population, the country faces significant employment challenges. The unemployment rate stands at 10.71%, with youth unemployment reaching an alarming 20.82%. Most critically, 84.6% of all employment remains in the informal sector, leaving millions of workers without adequate social protection.
Source: CBS Nepal
Source: Nepal Labour Force Survey
Source: ILO Nepal
Source: WIEGO Nepal
Source: The Global Economy, World Bank
Source: Nepal Labour Force Survey 2024
Source: Gender Data Portal, World Bank
Source: Gender Data Portal, World Bank
Source: Nepal Labour Force Survey
Source: Nepal Labour Force Survey
In agriculture, women earn significantly less than men, with female labourers earning NPR 553.9 (USD 4.2) per day compared to NPR 626.1 (USD 4.7) for males, representing a female-to-male wage ratio of 0.9.
Source: CEIC Data, Nepal Labour Force Survey
Source: WIEGO Nepal, 2024
Source: WIEGO Policy Brief, ILO Nepal
Approximately 1,500 youths leaving daily for foreign employment
NPR 145,093 average remittance per household in 2022-23
Source: Nepal Rastra Bank, 2024
Source: Department of Foreign Employment, Nepal
Source: Ministry of Labour, Employment and Social Security, Nepal
Source: Ministry of Labour, Employment and Social Security, Nepal
Source: Injury Prevention Journal, 2021
Source: Injury Prevention Journal, 2021
Source: Nepal Labour Force Survey, 2024
Source: ILO Nepal, 2024
Source: ILO Nepal, Occupational Safety and Health Assessment, 2024
Contribution Structure: 31% of basic salary (20% employer + 11% employee)
Source: Social Security Fund, Nepal, 2024
Source: Social Security Fund, Nepal, 2024
Agriculture employs 61.21% of Nepal's workforce but faces declining productivity and persistent poverty.
The sector is characterized by declining household participation (from 73.9% in 2010/11 to 60.3% in 2022/23) and shrinking land holdings (average size decreased from 1.1 hectares in 1995/96 to 0.4 hectares in 2022/23).
Source: Ministry of Agriculture, Nepal, 2024
The construction sector employs approximately 1 million workers (13.8% of total employment) and contributes 9.5% to GDP.
Key challenges include high informality, safety concerns, skill shortages, and increasing reliance on non-Nepali workers.
Source: Nepal Infrastructure Summit, 2024
An estimated 200,000-250,000 domestic workers, predominantly women, face unique challenges including wage discrimination, lack of legal protection, and no formal contracts.
Over 80% work without written agreements, and only 25% have any health benefits. There are also significant concerns regarding child labour in this sector.
Source: WOREC Nepal, ILO Report, 2024
The manufacturing sector employs 8.2% of the workforce but faces competitiveness challenges.
Worker concerns include job security, wage stagnation, limited union representation, and risk of job losses to automation.
Source: GEFONT Industrial Report, 2024
Source: Nepal Labour Force Survey, 2024
Source: Department of Foreign Employment, Nepal
Youth unemployment remains critically high at 20.82%, indicating systematic failures in job creation for new entrants to the labour market.
Source: ILO Nepal, 2024
A significant gap exists between available skills and market demands, with over 677,000 generally skilled workers migrating abroad compared to only 732 highly skilled workers.
Source: Department of Foreign Employment, Nepal
While remittances provide crucial foreign exchange, they indicate brain drain, consumption-oriented economy, and vulnerability to external shocks.
Source: Nepal Rastra Bank, 2024
The dominance of informal employment (84.6%) creates multiple challenges including limited social protection, weak enforcement of labour laws, and poor working conditions.
Source: WIEGO Nepal, 2024
Despite progressive labour laws, implementation and enforcement remain inconsistent, particularly in the informal sector and remote areas.
Source: Labour Rights Index, 2024
Emerging technologies pose risks of job displacement in traditional sectors while creating opportunities in the digital economy that require new skill sets.
Source: World Bank Nepal Development Report, 2024
Source: Ministry of Labour, Employment and Social Security, Nepal
Strikes decelerated GDP growth by 0.6-2.2 percentage points during peak periods.
Source: Online Khabar, Labour Law Analysis, 2024
Source: World Bank Nepal Productivity Report, 2024
Nepal's young population presents opportunities with growing working-age population and declining dependency ratio, but requires critical investment in human capital development.
Source: World Bank Nepal Development Report, 2024
Emerging technologies pose risks of job displacement but also create opportunities in digital economy, requiring digital literacy and technical skills transformation.
Source: World Bank Nepal Development Report, 2024
Environmental challenges will affect labour markets through agricultural adaptation needs, migration pressures, and opportunities in renewable energy and environmental services.
Source: World Bank Nepal Development Report, 2024
