ISLAMABAD: Small-scale industrial establishments and household manufacturing units have posted an annual growth of 1.58 per cent and 6.51pc, respectively, over the past 10 years, said a survey report of the Pakistan Bureau of Statistics (PBS).

This survey on Small and Household Manufacturing Industries (SHMI) is sixth in the series with the last report published in 1996, whereas the 2006-07 survey report was used internally.

The survey revealed that overall household manufacturing units recorded an annual growth rate of 6.51pc over the past 10 years.

The SHMI has a significant contribution to GDP and employment. This sector requires relatively small investment in machinery and equipment to create more jobs as compared to large-scale manufacturing. The SHMI focuses on the production and investment behaviour of the industries employing less than 10 employees.

According to the survey, the manufacturing establishments in 2015 reached 1.242 million units compared to 0.704m units in 2006-07 when the last survey was conducted by the PBS. Out of the total units, household manufacturing units were recorded at 787,964 (63.4pc) against 309,894 units in the survey of 2006-07, reflecting almost a double increase.

Contrary to this, the small-scale manufacturing units were recorded at 454,160 (36.6pc) during this period against 394,171 units reported about eight and half years ago, indicating a paltry growth.

The overall SHMI units in all the provinces registered a positive growth rate in 2015 compared to 2006-07 survey, with 5.04pc in Punjab, 9.76pc in Sindh and 4.79pc in Khyber Pakhtunkhwa and maximum growth of 30.57pc in Balochistan.

The two-digit growth in Balochistan was mainly due to small base in earlier surveys. In Balochistan, the household manufacturing establishments recorded a maximum growth of 32.52pc, followed by Sindh 15.93pc, KP 8.72pc and Punjab 8.61pc. Pattern is different for small manufacturing establishments, with growth rate of 23.72pc, 1.77pc, 1.21pc and 0.93pc for Balochistan, KP, Punjab and Sindh, respectively.

Within the household manufacturing, 751,329 (95pc) units are operated by individual ownership, whereas a small proportion of 4.6pc is operated under partnership or other arrangement. Similar trend is observed in respect of small establishments at the province level.

The percentage of household units operated by individual ownership is: 95.41pc in Punjab, 92.28pc in Sindh, 97.56pc in KP and 99.38pc in Balochistan.

Likewise, the percentage of small establishments operated by individual ownership in Punjab is 96.60pc, Sindh 98.38pc, KP 96.43pc and Balochistan 98.61pc.

As many as 2.695 million workers were engaged in the small and household manufacturing establishments throughout the country, as against 1.748m workers in 2006-07, indicating a growth of 5.2pc. Out of 2.69m workers, 1.5m (56pc) were working in the household establishments, while 1.19m (44pc) were engaged in the small establishments.

The province-wise percentage distribution of persons engaged in all the units varies considerably, ranking Punjab at top with 1.473m people, followed by Sindh 545,305 people, KP 424,582 people and Balochistan 251,647 people.

Balochistan leads marginally over KP with 1pc point in household units and KP indicates 242,988 persons compared to Sindh 169,491 and Balochistan 43,301 in small establishments.

The data on employment by gender suggests that there were 423,011 (28pc) males compared to 1.078 females (72pc) employees engaged in the household manufacturing units. In contrast, 1.143m (96pc) males were employed compared to 49,453 (4pc) females in the small manufacturing establishments.

The contribution to GDP (producers value) recorded in SHMI 2015 was Rs476.132 billion as against Rs104.332bn in 2006-07. This indicates a four-fold increase over eight and half years.

The value of Gross Fixed Capital Formation (GFCF) at the end of 2015 has been calculated at Rs81.98bn. The contribution of building and structure is maximum in the GFCF with Rs52bn (64pc), followed by machinery and equipment Rs28bn, which is about 34pc of the total.

Published in Dawn, October 13th, 2021

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