How productive is Pakistan’s workforce? The most recent National Transfer Accounts research carried out by the Pakistan Institute of Development Economics (PIDE) and United Nations Population Fund (UNFPA) paints a gloomy picture for Pakistani workers: the “people of Pakistan work for a lower proportion of their lives than other countries, while in jobs they are less productive and yield lower incomes.”
This finding is understandable given that Pakistan offers contractual employment, where most people are given a small base rate (below the minimum wage), and the rest of the salary is designed on a commission basis, which means that a person has to work round-the-clock to earn a certain amount.
This exposure to a hustle culture at a young age leaves most people uninterested in working full-time as their age increases. The study also highlights that Pakistan’s economy heavily relies on unpaid labour, especially by women. These findings call for an intervention by the relevant authorities – to fix the structural loopholes in Pakistan’s job market and help build a highly productive workforce. Employment trends are significantly different in each province. In Balochistan, for example, self-employment starts after the age of 50. In Khyber Pakhtunkhwa, the self-employment age is much younger. The study also says that “the pattern of labour income across all four provinces is consistent, increasing with rising labour force participation and peaking in the age group of 35-50”. It merits mention that at an age when people are young and can take risks, most Pakistanis prefer a safe job over business. This is because, for them, any business mishap means the irrecoverable loss of life savings. This preference adds more burden on the government which has to meet people’s demand for more job opportunities.
The study also throws light on consumption patterns across the provinces. The total consumption includes private and public consumption. The study’s data shows “that the highest level of other consumption is found in Punjab and Sindh, with nearly Rs60,000 per annum, Khyber-Pakhtunkhwa is around Rs50,000, and Balochistan hovers near Rs30,000 per annum.” The disparity in consumption levels calls for both federal and provincial governments to ensure that people in all parts of the country are paid enough so they can meet their needs.
The study also highlights an important point: “the current out-of-pocket expenditure on health far exceeds public expenditure in all provinces, often pushing households into poverty”. Every year, when governments announce their budgets, they are rightly criticized for not allocating enough funds to health and education. However, proponents of a free market always argue that the responsibility of affording good healthcare and education should rely on people who must work hard and earn enough money to meet these two basic needs. The study’s findings show that this approach is not working out anymore, and such expenses (that can well be afforded by the government) are pushing people below the poverty line, creating more challenges for the government. It is time the authorities reformed the entire system and made the job market a healthy place for the entire workforce. Low wages and the insistence that people can take up multiple jobs to sustain their lifestyle need to be challenged. People should be paid enough to lead a comfortable lifestyle so they do not have to constantly worry about their finances.