Unemployment at 6pc? Private sector begs to differ

Published November 27, 2017
Shoppers take advantage of the new Black Friday sales trend in Karachi. Based on an extensive survey across the country covering 38 cities and 270 villages with a sample size of 6,766 households, the report estimated the worth of Pakistan’s consumer market size at Rs1 trillion looking through the FMCG lens.—Tahir Jamal/White Star
Shoppers take advantage of the new Black Friday sales trend in Karachi. Based on an extensive survey across the country covering 38 cities and 270 villages with a sample size of 6,766 households, the report estimated the worth of Pakistan’s consumer market size at Rs1 trillion looking through the FMCG lens.—Tahir Jamal/White Star

PAKISTAN’S official unemployment rate is around six per cent. However, a private research firm recently reported that 49pc employable people are out of job in the country. The vast gap between the two estimates casts doubt on the value of official data and the federal agency responsible.

“Even without the current numerical evidence, people tend to doubt official projections of the job situation based on their own experience and observation,” commented a senior member of the government’s economic team.

But despite a lack of credibility, not just the government, but academics, media and development partners (such as the World Bank, ADB and IMF) have to depend on official sources for their data needs in the absence of an alternative set of countrywide statistic.

The corporate sector, however, quietly discards the official data. It relies and strategises on the findings of commissioned research reports conducted by specialists in the field. It’s growth trajectory, particularly that of fast-moving consumer goods (FMCG) multinationals such as Lever Brothers and Procter & Gamble, validates this choice.

There are several dozen tech-based data collection and processing companies serving growing demand from the private sector. Some respected global management consulting companies, such as McKinsey & Company and the Nielsen Corporation, have also been expanding their footprint in the country.

“Competition, ambition and the realisation of the expanding scope of business opportunities in Pakistan are forcing serious entrepreneurs to gain better insight of the society,” said a business guru, explaining the expanding role of private market research firms in the country. “We are rewarded and punished in tangible terms by the market. We can’t afford to depend on intuition.”

‘The availability and accessibility of credible national data is empowering in itself. It serves both the government and citizens in strengthening democracy,’ an economist says

Nielsen, a global marketing research firm, recently shared some interesting reports with Dawn. One of the six reports mailed, titled ‘Navigating what’s next: where the Pakistani consumers are heading’, provided a piercing insight into transformational Pakistani society. The 28-page report put the employment rate at 51pc against 94pc projected by the Pakistan Bureau of Statistics (PBS).

Based on an extensive survey across the country covering 38 cities and 270 villages with a sample size of 6,766 households, the report estimated the worth of Pakistan’s consumer market size at Rs1 trillion looking through the FMCG lens.

The report dissected the market spending and identified major drivers of the market. Food was identified as a major segment, absorbing as high as 79pc of consumer spending.

The drivers of expansion identified by the report were rising middle class (38pc, up 8pc since 2010), positive economic indicators, improved infrastructure (better physical and digital connectivity besides a stable power supply), New Age consumers (27pc millennials) and evolving family structure (74pc nuclear family).

Some interesting findings related to the rate of expansion in the rural market (9pc over double the rate in cities), the rise in modern trade (16pc growth, malls and departmental stores), trend towards premium products (brand preference) and the evolution of new tech-based channels of shopping.

PBS chief statistician Asif Bajwa was, however, unapologetic for the quality of official statistics.

“Nowhere is the national data set perfect. There is always room for improvement in the technique and methodology,” he told Dawn over the phone from Islamabad. “Here at the PBS, we diligently follow globally accepted definitions, criteria and techniques. The vast pool of metadata, available to the public online, is an asset.”

He also brushed aside the perception of inefficiency or wilful negligence at the PBS. “The government uses our data in the Economic Survey and multiple other publications. All donors and development partners also quote our data in their publications.”

On a wide divergence between official and private unemployment data, Mr Bajwa did not offer a direct answer. “What we do is not easy. Our team members work very hard in an often hostile environment with meagre means. Our work is not comparable to commissioned reports tainted by private companies’ interests. Some inconsistencies can’t be ruled out because of the size of the exercise, but we are tirelessly working to improve our work.”

Rukhsana Yasmeen, secretary of the Statistics Division, didn’t have “ready answers at the top of my head”, but said she would ask her staff to provide a considered response on the issues raised.

Some people did call from the PBS, but they were unaware of the research conducted by private companies and unable to locate the referred report online.

“The availability and accessibility of credible national data is empowering in itself. It serves both the government and citizens in strengthening democracy. Evidence-based policy and insightful interventions improve governance and equip citizens for better choices,” commented an economist.

“There is a need for an unwavering commitment in Pakistan to build a culture of dependable statistics by aiming for targets of independence, quality, trust, accessibility and data literacy,” he said.

Published in Dawn, The Business and Finance Weekly, November 27th, 2017

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