Worrying survey

Published September 18, 2021

THE findings of the Labour Force Survey 2018-19 indicate that some important headline trends have already taken or are taking firm root. That shouldn’t be surprising as the structure of the country’s labour markets and its economy remains unchanged. Primarily, the report gives us an overview of economic conditions and the state of employment during the government’s first year in power. To begin with, unemployment jumped to 6.9pc from 5.8pc the year before, betraying the economy’s weakening capacity to create jobs because of emerging macroeconomic imbalances, which pulled down the growth rate to less than 2pc that year. Many would argue — and not without reason — that ‘real’ unemployment would have surged to 8pc-9pc if the Pakistan Bureau of Statistics hadn’t shown a significant rise in the number of self-employed and unpaid family workers to project an additional 2.3m new jobs at a time when economic distress was forcing businesses to reduce jobs. Further, the survey data depicts an increase in labour force participation in agriculture, implying the sector had emerged as an employer of last resort. This shift in the labour movement from a high-productivity industrial sector to low-productivity sectors should be cause for concern. More worrying is the very low participation of women, underscoring the social and legal barriers to their entry into the labour force. Not all of them are able to get jobs and most of them are employed in low-paid and informal sectors of the economy or as unpaid family workers. The paid work participation rate of below 10pc for women in the urban labour force compared with 65.1pc for men speaks volumes about the gender gap in employment. Equally disturbing is the increasing number of child workers in the age group of 10-14 years as well as older teens.

Another important development underlined by the survey is the 16pc unemployment among those with 14 years or more of education, amplifying the huge disconnect between the education system and the changing job market. The survey results further emphasise the limited capacity of the formal, documented sector in employment generation, a major reason for low economic productivity and growth. Last but not the least, the report claims nominal wages to have grown during the survey year by more than 13pc. That seems unlikely given the large-scale lay-offs and pay cuts implemented by businesses to bridge the gap between their rising costs and shrinking revenues.

Published in Dawn, September 18th, 2021

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