Uzbekistan Quality Job Creation as a Cornerstone for Sustainable Economic Growth

Figure 1.15: Age Dependency Ratio, Uzbekistan, 1990-2018
Depndency ratio 
(% of working age population)
0
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90
2018
1990
1992
1994
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 Macroeconomic Performance, Opportunities, and Challenges
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trend continued even though the return to capital has been declining. This is 
because several past government policies created a bias against labor in favor 
of capital, even in labor-intensive industries. For example, in 2005–2016, real 
wage increases consistently outpaced labor productivity gains (World Bank 
2018). Other implicit subsidies for capital accumulation occurred through 
the granting of concessional interest rates and preferential access to foreign 
exchange at the official rate. Finally, the prereform tax system of granting 
preferential treatment to small enterprises based on the number of employees 
also created a bias against job creation. 
The government’s recent reform measures have removed many of the 
impediments to employment growth. In a World Bank survey of small and large 
enterprises, lack of access to foreign exchange, lack of access to raw material, 
lack of skilled personnel, high taxes, lack of demand for output, and lack of 
finance were cited as the most important factors that hinder job creation 
(Table 1.3). The exchange rate liberalization, continuous removal of tariffs, and 
tax reform addresses several of these key concerns. Eventual accession to the 
World Trade Organization will give access to new export markets, which will 
help remedy the issue of limited demand. While substantial progress has been 
made, more needs to be done to boost employment in the future.