The digital Population and Housing Census of 2023 conducted by the Pakistan Bureau of Statistics (PBS) has come up with an amazing and extremely worrying estimate. Apparently, the overall national unemployment rate in 2023 was as high as 22 percent. This is substantially higher than the estimate of the rate of unemployment in any previous year in Pakistan’s history.
The last Labour Force Survey was carried out by the PBS in 2020-21. At that time, the national unemployment rate was recorded at 6.3 percent. This implies that there has been a quantum jump in Pakistan in the number of unemployed workers from 4.5 million in 2020-21 to as many as 18.7 million in 2023. This represents an unbelievable increase of 315 percent in three years.
There is a need to identify the numbers of the labour force, employed and unemployed in the Census of 2023 and compare them with the numbers emerging from the last Labor Force Survey of 2020-21. This comparison is presented below in Table 1.
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Table 1
Labor Force, Employed and Rate of Unemployment
(Million)
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2020-21 2023 Change
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Labor Force 71.8 85.0 13.2
Employed 67.3 66.2 -1.1
Unemployed 4.5 18.7 14.2
Rate of
Unemployment (%) 6.3 22.1
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The labour force has increased annually by as much as 6.7 percent from 2020-21 to 2023, while there has been a fall in the number employed of 1.1 million. Consequently, the number unemployed has increased by 14.2 million.
There is the likelihood that the numbers in 2023 reflect the continuing negative impact of the floods. As such, a disaggregation is given below between the rural and urban areas of the country of the employment situation.
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Table 2
Rate of Unemployment in Rural and Urban Areas
(Million)
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Rural Urban Total
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Employed 2023 40.2 26.0 66.2
Unemployed 2023 13.1 5.6 18.7
Labor Force 53.3 31.6 84.9
Rate of Unemployment
(%)2023 24.6 17.7 22.0
2020-21 5.8 7.3 6.3
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The Table 2 clearly shows that there has been a much bigger jump in the rate of unemployment in the rural areas. This confirms the larger negative impact of the floods on the rural economy.
The Census defines a worker as employed if he/she has been at ‘work normally for the last 12 months for pay, profit or unpaid basis’. This is in sharp contrast to the definition in the Labour Force Survey of ‘employed’ as a person in employment as ‘at work’, i.e., who worked in a job for at least one hour in the reference week (one week before the survey). Clearly, the Population Census has adopted a much stricter and tougher definition of employment. Therefore, this has probably also contributed substantially to the much higher incidence of unemployment in 2023.
Based on the Census definition, it is useful if the rate of unemployment is identified in each Province and of male and female workers respectively. This is given in Table 3.
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Table 3
Rate of Unemployment by Province and Gender
(%)
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2020-21 2023 Change
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Khyber-Pakhtunkhwa 8.8 31.6 253
Punjab 6.8 18.2 168
Sindh 3.9 21.8 459
Balochistan 4.3 34.9 712
Females 8.9 39.3 342
Males 5.5 16.1 198
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TOTAL 6.3 22.0 249
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The unemployment rate in 2023, according to the Census, is the highest in the two smaller Provinces, Balochistan and Khyber Pakhtunkhwa. The Increase in relation to the rate in 2020-21 is the largest in Balochistan and Sindh.
The Census also gives evidence of gender discrimination in the labour market. Not only is the labour force participation rate of females very low but the unemployment rate is extremely high at above 39 percent.
Further, the difficulties that youth, aged 15 to 24 years, face are also highlighted by the Census. Their unemployment rate was 29 percent in 2023. In addition, there were over 16 million who were neither in the labour force or undergoing education. Consequently, the number of ‘idle youth’ reached the peak level of 22.7 million in 2023. This has implied a truly large waste of human resources in the country.
Given the very negative findings of the 2023 Census, it is essential that the PBS gives a proper explanation as to why the unemployment rate has risen from 6.3% in 2020-21 to the all-time peak level of 22 percent in 2023.
Copyright Business Recorder, 2025
The writer is Professor Emeritus at BNU and former Federal Minister
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