PESHAWAR: Pakistan Institute of Development Economics (PIDE) has released its latest report on unemployment in the country, in which it was revealed that over 31 percent of the youth with degrees, including professional ones, are unemployed with females at 51 percent and males at 16 percent.
For Pakistan, where nearly 60 percent of the population is aged less than 30 years, opportunities become even more significant. According to a press release issued from PIDE here on Sunday, the report revealed that if we take the employment trends as an indicator of available opportunities in the country.
The reported unemployment rate of 6.9 percent is considered to be comfortable and frequently makes headlines. Far more females and those living in urban areas are unemployed than their male and rural counterparts.
PIDE’s research states that a surprisingly large part of the working-age group is not even part of the labour force. These people are either discouraged workers or have other means of income to support them. While, despite pronouncements and policy initiatives, the female labour force participation rate (LFPR) remains shockingly low, the report said.
Despite all the talk about the youth bulge and reaping the demographic dividend, the unemployment rate is the highest for the young new entrants in the labour force. It takes about a decade or more for youth to be employed, the report mentioned.
The report also revealed that Education is considered a panacea and the key to all opportunities. The reality however shows us otherwise. Going by the LFS, graduate unemployment is very high. Over 31 percent of the youth with degrees, including professional ones, are unemployed with females at 51 percent and males at 16 percent. Rural graduate unemployment is much higher than urban, begging the question of mobility.
The study further stated that Services remain the largest employer with retail and wholesale trade the largest segment in the urban areas, while agriculture (including both cultivation and livestock) continues to employ the majority in rural Pakistan.
Surprisingly, construction employs about 8 percent of the labour force in both urban and rural areas, perhaps reflecting the harsh regulatory and zoning laws in urban areas that PIDE research has been highlighting. Despite the government’s pronouncements on construction, urban areas show no signs of being deregulated, reflected in the low proportion of the employed labour force in the industry. The construction industry, therefore, fails to provide the opportunities that it could have in the presence of reform.
According to PIDE’s recent report, Public employment, including both civil and military, provides opportunities for better-paid jobs in Pakistan. The well-known preference for government jobs, therefore, appears justified as the monthly wage in government shows up to be significantly higher than private-sector jobs.
The report pointed out that the urban definition used in the census and government surveys does not adequately capture cities or city populations and their boundaries. Additionally, Cities are heavily regulated to create bureaucratic sludge lowering productivity and wages.
The LFS seems to point to a need to study and understand our labour and product markets more carefully, as PIDE has been pointing out for years. Why is it that the urban areas are not providing the kind of opportunities they should?
The research further noted that Youth engagement is imperative, more so when they comprise the largest chunk of the population. The LFS shows one-third of the youth, in both rural and urban areas, to be disconnected from the system as they are neither employed nor enrolled. The disconnect is higher for young females, with 60 percent neither working nor studying. Socio-cultural norms, encouraging early marriage and childbearing, and reluctance to be in the labour market contribute to this trend.
Copyright Business Recorder, 2022
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