Bangladesh's industrial workforce is riding a rollercoaster, with the threat of layoffs hanging over workers almost daily. More than 10,000 workers have lost their jobs since Eid-ul-Azha, while over 400,000 have become unemployed in the past two years following the closure of more than 500 factories, according to labour leaders and industry insiders.
The latest retrenchments have deepened anxiety across the country's manufacturing sector, particularly the readymade garment (RMG) industry, which continues to reel from shrinking export orders, chronic gas and electricity shortages, soaring production costs and a sluggish global economy. Industry leaders warn that unless the energy crisis eases and business confidence returns, another wave of factory closures may be inevitable.
Industrial belts in Savar, Ashulia, Gazipur, Narayanganj and Chattogram have witnessed growing labour unrest following the latest retrenchments. Workers who lost their jobs are demanding reinstatement, payment of outstanding wages and legal compensation.
* 10,000 workers lost jobs after Eid-ul-Azha
* 400,000 workers become unemployed in past two years
* 500 factories shut down in same period
* 7, 560 workers were dismissed from 19 factories in Gazipur in May and June
* BGMEA has appointed two audit firms to assess around 400 financially distressed factories seeking govt incentives
One of the biggest recent layoffs occurred at Al-Muslim Group in Savar, where 1,868 workers from seven garment factories were dismissed. Since then, workers have been holding demonstrations in the Radio Colony, Ulail and Zirabo areas and staging protests on the service lane of the Dhaka-Aricha Highway, alleging that labour laws were not properly followed and many workers were denied their dues.
In Narayanganj, workers from several factories said they were informed after Eid that there were no export orders and therefore no work for them.
I had not received my salary for several months. Then suddenly I, along with many others, was terminated, said Kabir Hossain, a former supervisor at United Garments in Narayanganj.
A worker from Abir Fashion said management asked employees not to return after the Eid holidays because the factory had no new orders.
They simply told us to find work elsewhere. But jobs are scarce now, and we have families to support, he said.
Labour leaders say the pace of retrenchment has accelerated significantly since Eid.
Iqbal Hossain, General Secretary of the Bangladesh Trade Union Centre's Narayanganj district committee, said workers are being laid off across several factories before and after Eid.
We are witnessing a sharp rise in retrenchment. If this trend continues, industrial areas may face serious unrest. Thousands of workers have already become unemployed over the last few months, he said.
Industrial Police officials said factory owners are generally following labour laws by issuing notices and paying legal benefits before layoffs. However, many workers only discover they have lost their jobs after returning from Eid holidays, creating frustration and uncertainty.
To prevent unrest, Industrial Police have strengthened security in major industrial zones and are mediating between factory owners and workers whenever necessary.
According to Industrial Police, between May 17 and June 7, 560 workers were dismissed from 19 factories in Gazipur due to reduced work orders, excess manpower, disciplinary issues and labour disputes.
Official data show that 457 factories closed permanently between June 2024 and June 2026. Of these, 170 were textile and garment factories, while the remaining 287 belonged to other manufacturing sectors. However, labour organisations and business associations believe the real number exceeds 500, as closures of many small factories often go unrecorded.
The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) says 221 of its member factories have shut down over the last two years, while the Bangladesh Textile Mills Association (BTMA) reports that 234 textile mills have ceased operations since 2019, including 114 spinning mills.
Labour leaders estimate that more than 400,000 workers have lost their jobs over the past two years, including around 150,000 in the garment sector alone.
The industrial slowdown is being driven by multiple factors. Manufacturers cite prolonged gas shortages, frequent electricity outages, higher fuel prices, rising bank interest rates, increasing production costs, weak global demand and uncertainty in international trade following geopolitical conflicts.
Many factories are now operating at only 40 to 50 percent of their production capacity because of inadequate gas pressure and irregular power supply. In many industrial areas, manufacturers are forced to rely on generators, significantly increasing production costs.
BGMEA Senior Vice-President Enamul Haque Khan Bablu said factory owners never want to dismiss workers but are left with little choice when factories continue to incur losses.
No owner lays off workers intentionally. The business situation is genuinely difficult. If a factory has to reduce manpower to survive, it should do so only after paying all legal dues to the workers, he told the Daily Observer.
Bablu warned that the industry's outlook remains uncertain.
The signals we are receiving are not encouraging. We fear the situation could worsen unless business conditions improve. Our priority is to keep factories running and preserve employment.
BGMEA President Mahmud Hasan Khan said more than 200 additional garment factories are currently operating partially and remain at risk of closure.
If you ask me 500 times what the industry needs, my answer will always be uninterrupted gas and electricity. Financial assistance alone cannot save factories if energy shortages continue, he said.
He said that BGMEA has already appointed two audit firms to assess around 400 financially distressed factories seeking support from the government's incentive fund. Based on the assessment, the association will recommend eligible factories for financial assistance from Bangladesh Bank.
Economists believe the prolonged industrial crisis could have serious implications for the national economy by reducing investment, employment and export earnings.
According to official statistics, Bangladesh's merchandise exports declined by 1.64 percent in FY2025-26, while industrial growth slowed to 2.86 percent, reflecting the deteriorating condition of the manufacturing sector.
Experts say viable factories should receive working capital support alongside uninterrupted gas and electricity, while non-viable enterprises may require an orderly exit policy to minimise further financial losses. They also recommend expanding social safety programmes for displaced workers to ease the impact of rising unemployment.
Industry stakeholders warn that without immediate government intervention to resolve the energy crisis, restore investor confidence and stimulate export growth, Bangladesh's manufacturing sector could face an even deeper crisis in the months ahead.
