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Recently, thousands of applicants with a master's degree applied to become gardeners and door attendants in the Department of Education in Chakwal. The mushroom growth of colleges and universities across Pakistan has produced a large cohort of young graduates belonging to working class families.

The lacklustre economy, however, has failed to generate employment opportunities for the youth, resulting in an oversupply of the educated unemployed.

Even more troubling is the realisation that job creation is not a priority for the ruling elite.

The misplaced focus on sit-ins, Panama gate, and fatwas on how hard men should hit their wives has created an environment where economic development is no longer on anyone’s agenda.

The fuzzy math behind employment numbers

The under- and unemployment among Pakistani youth appears to be underreported. Consider that the current officially stated unemployment rate rests at under 6 per cent. This represents the fraction of the labour force that is actively looking for work.

Take a look: A few hard facts for unemployed Pakistan

These numbers could be misleading for the following reasons:

First, the labour force statistics underreport female workers in Pakistan. Even when some adult women are capable of working, they are excluded from the labour force statistics.

The World Bank considers individuals 15 years and older and are looking for work to be part of the labour force. According to the World Bank, Pakistan’s labour force is estimated at 65 million.

And here lies the problem: With a population estimated at over 196 million, the labour force size is one-third of the population. This is inadequately low when compared with advanced economies where labour force comprises roughly 60 per cent or more of the rapidly aging population.

In Pakistan, over 60 per cent of the population is between 15 and 64 years of age. This would suggest the upper bound for the total labour force to be 117 million rather than 65 million.

Take a look: More literate workers turn jobless

Second, how is the government estimating the number of those actively looking for work? The official statistics provide no confidence because of the state’s laissez-faire attitude towards data collection. Remember, Pakistan has not held a Census since 1998.

Thus, as a result, it’s not only the size of the labour force in Pakistan that goes likely underreported, it’s also the number of people actively searching for work.

Its no wonder then that the government reports unemployment rate for 35 to 39 years old at 1.98 per cent. The reported unemployment rate for rural males between 35 and 39 years of age is even worst, resting at a mere 1 per cent.

Click to enlarge. —Source: Pakistan Bureau of Statistics
Click to enlarge. —Source: Pakistan Bureau of Statistics

Going by that data, it appears then that Pakistan’s economic engine is beating the Western economies in job creation.

Under Employment is the bigger story

Despite the fuzzy math used to dismiss the issue of unemployment, the state is rather silent when it comes to the bigger challenge of underemployment.

I would define underemployed as those working in jobs that do not pay a living wage, or who have accepted positions that do not match their credentials. For example, someone with a Master’s degree in Chakwal working as a gardener is not unemployed, but underemployed.

How big of a problem is underemployment in Pakistan? And equally relevant is the question about the size of the workforce that is mismatched resulting in less than optimal worker productivity in the economy.

Recent estimates for underemployment are hard to find. The government reports the distribution of the underemployed, but not their absolute numbers.

My primary concern is about how the state defines underemployment.

The state considers those working for fewer than 35 hours in a given week as underemployed. This definition assumes that those working for 35 hours or more in a given week are gainfully employed, i.e., they are earning enough to support their families.

The under and unemployment figures are quite meaningless for struggling economies like Pakistan. Even by the government’s estimates, 60 million Pakistanis, 29.5 per cent of the population, live below the poverty line. Experts at Oxford University estimate a much larger proportion of Pakistanis (44 per cent) to be poor.

Also read: While politicians evade millions in taxes, 60 million of us live below poverty line

Thus, boasting about low unemployment rates is rather futile because a large proportion of those considered employed by the government are not earning enough to feed and clothe their families.

The job-education mismatch

Pakistan under General Musharraf embarked on opening new and expanding existing universities — the size of the university-going population increased several folds.

While the quality of graduates could be a matter of debate, their quantity isn’t.

A number of graduates left universities and colleges searching for jobs that did not exist. Many graduates, such as the ones in Chakwal, have grudgingly embraced the job-education mismatch.

The universities in Pakistan are not preparing the graduates for the job market. University-based career centres, where students learn interview and presentation skills, are largely missing from the public sector universities.

Also read: What should parents look for in university rankings?

At the same time, universities do not publically disclose the percentage of graduates who secure employment within one year of graduation, making it difficult for prospective students to determine the utility of the degrees they intend to pursue.

With Pakistan's high birth rate consistently adding millions to the labour force each year, the ultimate responsibility to create jobs rests with the federal and provincial governments.

Strengthening the growth of domestic markets should be among the top-most priorities of the state, with a focus on facilitating the private sector to grow, which will, in turn, generate new jobs.

The state must not let Pakistan's valuable human capital go to waste the way it currently is.