lot has been said about CPEC’s ability in generating new employment avenues in the country. No doubt; as China Pakistan Economic Corridor enters the second phase especially once the special economic zones (SEZs) are developed. But very little attention has been paid to what these new jobs would demand. What has remained neglected is the changing nature of jobs and hence, the skills required from the labour force. SBP’s second Quarterly Report highlights some key issues and policy recommendations that have been talked about time and again in this space. (Read: ‘Human Capital 2.0”, “The vocational challenge”).
Dr Ishrat Husain in his article ‘Policy Imperatives for CPEC say that If there is one lasting legacy for which CPEC should be remembered that is the investment in producing skilled and trained technical manpower of different levels of expertise.” In its special section on the importance of human capital in the of CPEC, the central bank also talks about the changing nature of jobs, and that the human capital in the country needs to upgrade its skill set to meet the changing requirements of the evolving nature of work.
The existing level of human capital development in the country does not meet the increasing requirement from these new jobs, and the authorities and the stakeholders need to realise that they need to upgrade and ready the workforce before China inundates all available jobs and employment opportunities with its skilled workers. Already, Chinese workers have dominated many projects in the first phase of CPEC. The SBP highlights that as per the working paper by the CPEC Center of Excellence, energy, road and rail projects have resulted in the creation of around 124,470 direct jobs across the country between FY15 and FY18. It also points out that while it’s common for China to bring its workers, some of it has to do with the lack of skilled workers in Pakistan for all the new jobs. The ratio of Chinese to Pakistani workers during construction and operational phases of some of these projects remained tilted towards the Chinese: 58:42 and 37:63, respectively-to be exact.
And now that the country has moved from the road and energy infrastructure to more specialised sectors and knowledge-intensive fields such as mechanisation in agriculture, and digital and technological advancements, the jobs are likely to become more intense when it comes to the skilled needed. 1.2 million Jobs by FY31 are what the central bank puts forth after factoring in the development of nine proposed Special Economic Zones (SEZs). Three issues with the existing human capital that SBP highlights are inadequate education; very low labor force productivity over the last 20 years versus its peers like India, Sri Lanka, Vietnam, Bangladesh and China; and poor technical capabilities.
A very obvious yet less flashy solution is working aggressively on skills development. Besides the much needed reforms in the education sector, the government not only has to take up skills development up its priority ladder but also revamp the entire vocational and training system. In a recent interview with BR Research, Jawad Khan – CEO PSDF said that it is important to understand that the existing models don’t work at the national level and they have to be radically changed whether it is governance; industry engagement; the kind of program being offered; and funding mechanism, etc. Developing a robust skills development program together with the Chinese to capitalise on CEPC and SEZs ha to be complemented with efforts to increase financial and digital literacy.
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