Sheikh Selim
Every few years, Bangladesh performs the same ritual. A pay commission is formed, a new scale is announced, government employees celebrate, and newspapers publish headline percentages that sound, on first reading, like genuine progress. The approval of the 9th National Pay Scale in 2026, the most ambitious revision in the country’s history, followed this script exactly.
The lowest grade rises 142 percent, the highest doubles, and ministers call it historic. I want to ask the plainer question already being asked around dinner tables in Mirpur and Bogura: after eleven years of waiting and rising prices, are employees actually better off, or just holding a bigger number?
This is not a rhetorical question. It has an arithmetic answer, and that answer is not a comfortable one.
Chasing a Moving Target
Bangladesh’s first pay scale, introduced in 1973, set a minimum basic salary of Tk 130 in a war-ravaged economy. Nine commissions later, that floor stands at Tk 20,000, and the ceiling has climbed from Tk 2,000 to Tk 156,000. Viewed across five decades, this looks like an extraordinary story of state generosity. Viewed decade by decade, it looks like something closer to survival.
Each commission has landed roughly a decade after the one before it, and in between, employees have absorbed rising prices on nothing more than a 5 percent annual increment never built to fully cover them. The 9th pay scale did not arrive out of sudden government generosity. It arrived because the previous scale, set in 2015, had quietly stopped functioning as a living wage.
What Percentages Hide
Public debate here has been too generous, and too imprecise. A 142 percent nominal increase sounds like a windfall, but it is not the same as a 142 percent increase in what an employee can actually buy. Treating the two as interchangeable is the single biggest distortion in how this reform has been discussed.
To see the difference, we need to do what officials rarely do in public: adjust the headline figure for inflation over the eleven years between the 8th pay scale (2015) and the 9th (2026). That inflation was rarely gentle. It stayed above 9 percent through much of 2022 and 2023, touched roughly 10 percent in 2025 by IMF data, and sat at 8.58 percent as recently as January 2026. Taking a conservative average of 8 percent a year, broadly consistent with figures from Bangladesh Bank, BBS, and the World Bank, cumulative price growth compounds to roughly 133 percent over the period.
Set that against the pay scale’s own numbers and the picture shifts sharply. The lowest grade’s salary multiplied by 2.42; prices multiplied by roughly 2.33. Divide one by the other, and the real, inflation adjusted gain in purchasing power for the lowest paid employee comes to about 4 percent across eleven years, not 142 percent. That is closer to a rounding error, roughly 0.35 percent of real gain a year, slower than the country’s own long run per capita GDP growth.
For the highest grade, it is worse. A 100 percent nominal rise against the same 133 percent inflation produces a real decline of roughly 14 percent. The most senior civil servants can buy less today than their predecessors could in 2015. Even using a deliberately conservative inflation assumption, the 9th pay scale has not restored what was lost since 2015. It has only slowed the erosion.
This is not a marginal point. It is the central fact that should have governed how this reform was reported and debated, and it did not.
Forces Working Against the New Salary
The cost-of-living adjustment problem is not a single number. There are at least three distinct pressures stacking on top of one another, and a rigorous account must separate them rather than blend them into one vague impression of expense.
The first is headline inflation itself, which the government’s own wage growth data already concedes is losing the race. In January 2026, wage growth stood at 8.16 percent while inflation ran to 9.94 percent, a real wage contraction of close to two full percentage points in a single month. That is not a one off. It is a snapshot of the pattern that produced the case for a new pay scale in the first place.
The second is currency depreciation, which official inflation statistics only partially capture. The Taka lost roughly 40 percent of its value against the US dollar over the decade between pay scales. Because Bangladesh imports a significant share of its fuel, edible oil, and pharmaceutical inputs, this depreciation feeds into domestic prices with a lag and through channels that a simple CPI figure understates. An employee’s real loss in purchasing power is therefore probably larger than the CPI adjusted figure above suggests, not smaller.
The third is geography, and this is where uniform percentage increases become actively misleading. A living wage benchmark for Dhaka in 2025 placed the cost of a basic but decent life at Tk 48,022 a month. The new minimum government salary is Tk 20,000. Even after the largest nominal increase in the country’s history, the lowest paid government employee posted in Dhaka falls more than Tk 28,000 short of that benchmark every single month, before rent alone is even discussed. With family flats in Mirpur, Mohammadpur, or Uttara commanding Tk 15,000 to Tk 30,000, a junior employee’s entire basic salary can be consumed by housing before food, transport, or medical costs are considered.
Employees outside Dhaka face a different calculation, not necessarily an easier one. Rents in Bogura, Comilla, or Jessore run a third to half of Dhaka levels, but that apparent relief hides real costs: weaker healthcare, fewer decent schools, limited work for a spouse, and thin public transport that pushes families toward costly rickshaws. The pay scale treats a taka earned in Jessore as equal to one earned in Dhaka, softened only by a 20 percent house rent allowance limited to a few metropolitan areas, far short of closing the actual gap. A rigorous adjustment would price these differences explicitly, not pretending one national scale fits two different economies.
The Trap Ahead
A further risk deserves more attention than it has received. Economists warn, plausibly, that a raise this large, reaching hundreds of thousands of employees at once, can itself stoke inflation through added demand and fiscal spending. If that happens, part of the lowest grade’s 142 percent nominal gain will be eaten by the very inflation the raise helps produce, pushing the already slim 4 percent real gain toward zero or into negative territory. Bangladesh would then have spent vast fiscal and political capital on a reform that, within a few years, delivers less lasting improvement than its headline figures promised.
This is the same trap that has caught every earlier pay commission. The 8th scale looked generous in 2015 too, until a decade of inflation and a currency that lost nearly half its value quietly hollowed it out. Nothing about the 9th scale’s design, its once a decade timing, uniform national rates, or modest annual increment, guards against a repeat.
There is also a behavioral cost. If employees read the nominal increase as newfound wealth rather than adjust for real cost of living, that false sense of comfort can loosen financial discipline and, in some cases, feed the very culture of corruption a fair wage was meant to curb.
What Would Actually Fix This
I do not think the answer is simply a bigger number next time. Bangladesh’s per capita income has grown from about 110 dollars in 1973 to roughly 3,020 dollars today … but real macroeconomic progress has not grown by any measure. The World Bank estimates that 62 million people, half the country’s non poor population, remain at risk of sliding back into poverty, and food still consumes 45.8 percent of average household spending, a share that rises further for lower income families, including many junior government employees. A wage policy that only resets every decade cannot track the cost of living that moves every month.
What the country needs, and what this newspaper will keep arguing for, is a genuine cost of living index built into the pay structure itself: an annual adjustment tied transparently to actual CPI data rather than a flat 5 percent increment set once and left to erode; a house rent allowance recalculated against real rental markets in Dhaka and other high cost cities rather than a blanket 20 percent that has not kept pace with the House Rent Index’s own recorded gains; and honest public communication that reports pay reforms in real, inflation adjusted terms alongside the nominal figures that generate more favorable headlines.
Until then, every new pay scale will be announced as a triumph and quietly become a disappointment, and public servants from the traffic choked lanes of Dhaka, where the average speed is a crawling 4.8 kilometers an hour, to the quieter streets of Jessore and Bogura, will keep discovering that a bigger salary and a better life are not, in this country, the same thing at all.
