Research indicates that remittances particularly reduce labour force participation among recipients, as they are often perceived as 'non-work money'.

The study titled 'Analysing the Impact of Remittance on the Labour Force Participation Rate: Evidence from Bangladesh' utilized data from 1991 to 2022 to explore these complex relationships.

Despite the significance of remittances, few studies have employed advanced econometric techniques to thoroughly analyze their impacts on labour force participation, highlighting a gap in existing research.

Contrasting studies reveal that while remittances do not significantly affect men's labour force participation, they can promote self-employment through investments in entrepreneurship.

While these remittances can enhance living standards, they may also discourage participation in the domestic labour market, fostering a reliance on external income.

Remittances contribute to long-term labour market engagement by funding education and skill development, as well as providing capital for small businesses.

To maximize the positive impact of remittances on the labour market, policymakers are encouraged to create environments that direct remittance inflows into productive investments and human capital development.

Overall, remittances have a mixed effect on the labour market, influencing both participation rates and economic stability.

In 2023, personal remittances in Bangladesh reached approximately $23 billion, making up five percent of the country's GDP, which has significantly aided in poverty reduction and increased household spending.

Findings suggest that there is no short-run impact of remittances on labour force participation; however, a positive long-term effect exists, with a one-unit increase in remittances correlating to a 0.00267 unit increase in participation rates.

The exchange rate also plays a crucial role in labour force participation; a depreciation is linked to a 0.06890 unit increase in participation, suggesting that it enhances export competitiveness and creates more employment opportunities.

Stability in exchange rates is vital to reduce labour market distortions, especially in sectors sensitive to trade and remittances, thereby promoting more resilient labour market outcomes.