Nepal’s Demographic Advantage at Risk

Nepal’s economy looks good on paper at first glance, with a large number of young, working-age people. In reality, however, the situation is quite different. Government figures show youth unemployment at 12.7 percent. Even more disconcerting is that less than 40 percent of the labour force is actually employed. Too many people earn little or nothing while the country struggles to move forward. Fresh data from the National Statistics Office makes this imbalance hard to ignore. The National Transfer Accounts report shows that people in Nepal spend far more than they earn through work. The shortfall, known as the life-cycle deficit, has reached around Rs 1,500 billion. Most people depend on someone else’s income for much of their lives. Children and young adults rely on families, while older citizens slip back into dependence as costs rise and earnings fall. Only those roughly between the ages of 27 and 46 earn more than they spend, and even that phase does not last long.