Confronting the dearth of educated and trained manpower
EDITORIAL: Among the many glaring challenges that the budget document has thrown up, the enduring burden of unemployment — particularly youth unemployment — stands out as a critical concern, reflecting both a sluggish job market and inadequate policy response to the needs of a growing workforce.
As reported by the Economic Survey 2024-25, the unemployment rate stands at 6.3 percent, with the situation especially troubling for youth aged 15-24, among whom joblessness reaches 11.1 percent. This cohort represents nearly 45 percent of all jobseekers, underscoring the scale of the challenge. The crisis is deepened by stark gender disparities — 14.4 percent of young women are unemployed compared to 10 percent of young men — as well as a persistent mismatch between the skills imparted through education and those demanded by the labour market, leaving many young people unprepared for available opportunities.
However, far from mounting a focused and determined effort to address unemployment and underemployment, the issue continues to be met with persistent neglect by policymakers. In fact, the scale of the neglect can be judged by the fact that even before meaningful solutions can be crafted, the government has failed in as basic a task as providing an accurate picture of the problem as the unemployment figures cited in the Economic Survey rely on outdated figures from the 2020-21 Labour Force Survey. As reported in this newspaper, the reason given for the failure to calculate more up-to-date figures was the delay caused by the Pakistan Bureau of Statistics undertaking the 7th Population and Housing Census. That exercise, however, concluded two years ago, and one would have expected that a challenge as fundamental to Pakistan's economic future as unemployment would have commanded greater urgency by our economic managers.
The delay in addressing the data gap underscores a broader inertia in policy thinking around how to confront the unemployment crisis. The least the government could have done for the upcoming fiscal year was to come up with a comprehensive plan aimed at bridging the country's substantial skills deficit. This could have encompassed meaningfully incentivising the establishment of polytechnic institutes and vocational training centres across the country. Moreover, there could have also been a focus on encouraging the corporate sector to take an active role in developing structured apprenticeship and training programmes that equip young individuals with market-relevant skills through hands-on, on-the-job experience.
It is vital to understand that without serious investments in technical education and adult vocational training, any attempt to address unemployment in Pakistan will remain superficial. Polytechnic institutes, in particular, have the potential to play a critical role in preparing a workforce aligned with the evolving demands of industry by offering practical alternatives to traditional academic tracks and opening viable employment pathways for millions of young Pakistanis who are currently being left behind by the system. Properly developed, vocational training and polytechnic institutes can prove to be transformative by offering youth a path to economic empowerment and meaningful inclusion in the workforce, while simultaneously boosting industrial competitiveness and productivity.
Beyond skills development, any strategy to tackle unemployment must also target the SME sector, which is inherently labour-intensive and largely informal. Here, the priority must be to incentivise its shift to the formal economy, unlocking its access to banking finance, which could prove crucial both for the growth of these businesses and their capacity to create jobs. Simultaneously, investments in labour-intensive sectors such as agriculture, construction and manufacturing are essential to absorb a growing workforce, while encouraging digital entrepreneurship could also serve as a key driver of job creation, particularly among the youth. Ultimately, equipping the workforce with skill sets and education that reflect market demand coupled with fostering an environment conducive to private sector-led job creation will be vital for addressing the country's significant employment gaps.
Copyright Business Recorder, 2025
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
3 hours ago
- Business Recorder
Budget boosts agri loans, but growth uncertainty remains
LAHORE: While the budget 2025 continues to present agriculture as the backbone of Pakistan's economy - contributing 24% to the national GDP - experts and stakeholders expressed concerns that real growth and resilience in the sector remain uncertain. The government has introduced several policy initiatives aimed at improving agriculture and strengthening climate resilience. These include an increase in agricultural loans from Rs 1,785 billion to Rs 2,066 billion, digital refinancing of up to Rs 100,000 for small farmers without collateral, and the establishment of the National Seed Development and Regulatory Authority to support climate-compatible seed systems. In addition, the National Agriculture Biotechnology Policy and National Seed Policy 2025 are in the final approval stages, aiming to improve innovation, seed quality regulation, and private sector involvement in research and development, according to Aamer Hayat Bhandara, a progressive farmer and co-founder of Agriculture Republic. A National Agriculture Committee is also being formed to improve coordination between federal and provincial governments - acknowledging that agricultural execution primarily falls under provincial jurisdiction. However, the Economic Survey of Pakistan reported just a 0.56% growth rate in the agriculture sector which is considered 'disheartening' for a country where millions depend on farming. 'Despite agriculture being frequently mentioned in policy debates, the lack of a long-term, consistent strategy continues to hold back meaningful progress. Relying solely on policy announcements is risky - especially when climate change, water inefficiency, and weak farmer support remain unresolved,' said Bhandara. He emphasized that real change will come only when policies are implemented effectively and reach the grassroots level. Meanwhile, the Kissan Board Pakistan (KBP), a small farmer advocacy group, criticized the budget for ignoring the agricultural community. They argued that inadequate subsidies for crop procurement and indirect taxes on farming inputs would further strain farmers. KBP President Sardar Zafar Hussain Khan, General Secretary Dr. Abdul Jabbar Khan, and Secretary Information Haji Muhammad Ramzan, in a press conference, pledged to continue advocating for farmers' rights. They warned that unless agriculture is placed at the top of the national agenda, economic progress will remain limited. Pakistan Kissan Ittehad (PKI) President Khalid Khokhar and Aamer Hayat Bhandara also pointed out inconsistencies in tax policies. They called for the removal of the 18% GST on local cotton, arguing that it creates an unfair advantage for imported, tax-free cotton. Removing the tax would support local growers and help revive domestic cotton cultivation. Experts noted that climate change featured prominently in both the Economic Survey and the federal budget speech. The government has secured $1.4 billion through the IMF's Resilience and Sustainability Facility (RSF) to invest in climate-resilient infrastructure, seed systems, and risk management. Encouragingly, no new taxes have been imposed on fertilizers and pesticides, protecting farmers from additional costs amid ongoing IMF reforms. However, the imposition of GST on solar energy technologies has drawn widespread criticism for threatening clean energy access in agriculture. For many smallholders, solar-powered tube wells, cold storage units, and off-grid irrigation systems remain the only viable options amid high electricity costs and climate challenges. Making these technologies more expensive, experts warned, could hinder the country's goals for climate adaptation in rural areas. Copyright Business Recorder, 2025
Business Recorder
4 hours ago
- Business Recorder
Austerity for minimum wagers
Nine years. That's how long the nation's hardworking, self-sacrificing, people-loving parliamentarians have bravely endured the cruel injustice of frozen salaries and allowances. Imagine the horror: no special allowance top-ups, no cost-of-living adjustments for their relentlessly rising grocery bills, no relief in sight while they burned the midnight oil passing important legislation. Truly, our elected elite were left out in the fiscal cold. Thankfully, salvation is here. In a move sure to warm their hearts—and their wallets—the government has proposed to increase the salaries and allowances of cabinet members and parliamentarians. The Finance Minister, with a straight face and perhaps a tear in his eye, explained that even lawmakers face 'hardships.' And it's only fair they get a raise, seeing how their wages haven't been revised in nine whole years. Except, that's not exactly true. The combined employment-related expenditure of the National Assembly and Senate has gone from Rs3 billion in FY17 to a proposed Rs15 billion in FY26. That's a 5x jump. Even more astonishing, the number has nearly tripled in the past four years alone. While some of this includes the pay of officers and staff, the bulk goes to the honourable members themselves. Exponential, you say? No wonder their 'hardships' needed such generous budgetary intervention. Now contrast this with the wages of actual workers—say, the kind Pakistan Bureau of Statistics tracks weekly for the construction sector. Those have merely doubled over the same nine years. And the federal minimum wage? Stuck at Rs37,000, with no increase proposed in the new budget. Because apparently, raising it might upset our fragile exporters and make our bedsheets less competitive. But let's not get distracted by technicalities like inequality. It's important to remember that the federal minimum wage, though non-binding, often acts as a cue for provinces to set their own. So when it's left unchanged, it sends a clear message: tough luck, workers. And let's not even get into enforcement. Provincial wage data by industry shows widespread violations. Most manufacturing sectors are happy to quote the minimum wage at job interviews—before paying well below it in practice. Meanwhile, as the Finance Minister tiptoes around industry lobbies and export competitiveness when asked about worker pay, he has no such reservations when it comes to ministerial kitchen budgets. After all, parliamentary pantries don't stock themselves. One wonders—if minimum wage hikes hurt competitiveness, do parliamentary allowance hikes make Pakistan more productive? If construction workers earned less, would parliamentarians legislate better? Perhaps it's time we face a hard truth: austerity is not for everyone. In Pakistan, it's a privilege reserved for the powerless. The rest can rest easy—preferably on freshly redone parliamentary benches.
Express Tribune
6 hours ago
- Express Tribune
GDP figure based on old data
Listen to article Pakistan's Chief Statistician Dr Naeemuz Zafar said Thursday that the 2.7% economic growth estimate for this fiscal year is based on a 15-year-old livestock survey and assumes full utilisation of the Rs1.1 trillion development budget. While responding to questions about the controversy over this year's economic growth figure along with Planning Minister Ahsan Iqbal, Dr Zafar claimed that there would be no major downward revision in the 2.7% figure for the outgoing fiscal year. Iqbal also proposed a new formula for resource distribution under the National Finance Commission (NFC), moving away from the current population-centric model. The Pakistan Bureau of Statistics (PBS)'s chief statistician called objections to the 2.7% growth rate "unfortunate" and said if a committee is formed to investigate, the PBS is ready to appear. The government claims a 2.7% GDP growth this year, which independent economists have disputed, estimating it to be closer to 2%. A major objection concerns the 4.8% livestock sector growth. The livestock sector's 4.8% growth was based on a survey conducted back in 2010, admitted Dr Zafar, adding that there was no deviation from the standard methodology. When asked how the agriculture sector showed 0.6% growth despite a 14% output decline in major crops, Dr Zafar said the growth was driven by livestock, forestry and minor crops. The Gross Domestic Product (GDP) growth figure has been worked out in a transparent manner by following a methodology endorsed by the United Nations and the international financial institutions, he said. He also confirmed a new agriculture and livestock census has been completed but awaits the planning minister's approval due to his budget commitments. He added that the Household Integrated Economic Survey, Labour Force Survey, and agriculture census would be ready by October for the next National Accounts Committee (NAC) meeting. Leader of the Opposition Omar Ayub Khan raised the disputed GDP issue during the National Assembly Standing Committee on Finance meeting held on Thursday. In a statement, the statistician also stated PBS used the full Rs1.1 trillion federal Public Sector Development Programme (PSDP) figure for GDP calculationshighlighting a glaring methodological flaw. However, Finance Secretary Imdad Ullah Bosal told the same committee that against the Rs1.1 trillion PSDP allocation, only Rs662 billion had been spent so far. He added that by June-end, spending would remain below the revised Rs967 billion figure. When asked whether the GDP would be drastically revised in the next NAC meeting, Dr Zafar again said no major revision was expected. Speaking at the meeting, the planning minister said the country was on a path to steady economic recovery with a goal of sustainable economic growth. Iqbal added that Pakistan continues to face structural problems of fiscal constraints. Due to limited space, next year's federal PSDP will be just 0.8% of GDPdown from 2.6% seven years ago. The planning minister noted that the federal government's Rs11 trillion net revenues were barely enough to cover defence and debt servicing. "With limited tax contributions, people cannot hope for international standard facilities," said Iqbal. He also called for reforming the NFC award by shifting away from the predominantly population-based distribution formula with broader indicators like education and forestation. Iqbal is the second federal minister after the finance minister to propose a shift in the NFC criteria this week. Currently, 82% of total resources are allocated based on population, which Iqbal argued incentivises population growth, harming national interests. He said the Planning Commission would recommend shifting to a broader formula that rewards education and forest preservation. Prime Minister Shehbaz Sharif, he added, has decided to constitute a Pakistan Population Council, comprising provincial chief ministers, to design strategies for population control. Pakistan's annual population growth rate stands at 2.6% — nearly equal to this year's GDP growth rate. Responding to a question whether the Federal Board of Revenue (FBR) took him into confidence before imposing taxes on the digital economy, Iqbal said these were levied with the intent to create a level playing field for conventional retailers. Commenting on the upcoming PSDP, Iqbal said Rs230 billion had been allocated for Balochistan projects from the Rs1 trillion envelope. Despite limited resources, the government would invest more in water reservoirs. He said Diamer Basha Dam with 6 million acre-feet capacity and Mohmand Dam with 1 million acre-feet would be completed by 2030 to mitigate water shortages caused by potential Indian efforts to block Pakistan's share of water. Iqbal added that construction of Diamer Basha Dam would be advanced by two years with increased investment, aiming for completion by 2030 in response to regional water developments. Due to budget constraints, funding for the Higher Education Commission (HEC) has been reduced to Rs39.5 billion. Iqbal suggested provinces should bear the responsibility of funding universities.
