The paper explores the linkages between ‘Education’ and ‘Poverty’ and the possibility of poverty reduction through better employment opportunities. The paper proceeds with the understanding that poverty acts as both cause and effect of a lack of education. In particular, the paper examines whether education is contributing to poverty reduction among rural households in Bangladesh, based on a school level survey as well as household survey conducted under the Programme for Research on Chronic Poverty (PRCPB) Phase-II. The study addresses the question regarding the access of poor and non-poor to primary and secondary levels of education by looking at the impact of poverty on the enrolment rates. Links between poverty and the rate of SSC completion and the success rate of SSC are also analyzed. The empirical evidence suggests high differentials between the poor and non-poor groups, the variations increasing along the continuum of education levels from primary to secondary to SSC completion. Reduction of such differential requires an understanding of where previous policies have failed in closing these gaps, as well as, a policy approach which will ensure that stipend and other support programmes for education give priority to poorer children. The paper has also addressed questions regarding the quality of education received by poor and non-poor (mainly based on qualitative assessment of children’s performance, repetition of classes, and their SSC grades), and the links between quality of school attended and poverty.

An analysis of the state of unemployment and the extent of underemployment among the educated youth from various poverty groups has been carried out. The findings indicate that the level of education is positively associated with the percentage of labour force in salaried employment. Hence, it is imperative to take initiatives towards job creation and skill development of those who have education below SSC level.