Unemployment rate jumps from 5.8% to 6.9% in 2018-19: LFS

September 17, 2021 (MLN): The unemployment rate in Pakistan jumped from 5.8% in 2017-18 to 6.9% in 2018-19, the Labor Force Survey (LFS) published by the Pakistan Bureau of Statistics revealed.

The survey showed that the increase was observed both in the case of males and females with the male unemployment rate soaring from 5.1% to 5.9% and the female unemployment rate rising from 8.3% to 10%. This indicates that the unemployment rate in females was more pronounced as compared to males.

In terms of number, 64.04 million people were employed in 2018-19 compared to 61.71 in 2017-18. If we divide this by gender, female employment between the same years increased by 1.17 million, while male employment increased by 1.16 million.

Province wise, the unemployment was the highest in Khyber Pakhtunkhwa with a rate of 10.3%, followed by Punjab at 7.4%, Balochistan at 4.6%, and Sindh with the lowest unemployment rate at 4%Region-wise LFS data shows that the unemployment rate in urban areas stood at 7.9%, up from 7.2% a year before, while rural unemployment increased to 6.4% from 5% in FY18. This suggests that the increase in the unemployment rate was more pronounced in rural regions.

As per the data, the agriculture/forestry/hunting & fishing sector provided the largest 39.2% of employment in FY19, higher than 38.5% it was providing in the previous year. The construction sector provided 8% of jobs compared to 7.6% in FY18, Community/social & personal services absorbed 15% of the total workforce during FY19 against 14.7% in FY18. While the decline was noted in Manufacturing and wholesale & retail trade sector as they offered 15% and 14.5% of unemployment during the period respectively, down from 16.1% and 14.9% in FY18.

The survey results show that the informal sector accounts for 72.4% of non-agricultural employment with more in rural (76.7%) than in urban areas (68.1%).  On the other hand, the formal sector activities are concentrated more in urban areas (31.9%) than in rural areas (23.3%). The share of females in comparison to the share of males is more evident in urban formal (39.5%) and rural informal (78.6%) sectors, while the share of males is more prominent in rural formal (23.6%) and urban informal (69%).

Moreover, employment in the formal sector decreases from 28% to 27.6%, while employment in the informal sector increases marginally from 72% to 72.4% during the comparative periods. Shares of male’s employment scale down in the formal while that of females scale up in the same sector. In the informal sector, the employment of males increases while in the case of females decreases during the comparative periods.

The working-age population of Pakistan LFS survey stood at 153.5 million in FY19 of which, 94.1 million, or 61.3% of this population is working in rural areas, while the rest 38.7%, or 59.3 million people are working in urban areas.

The labor force of Pakistan recorded at 68.73 million for FY19, indicating that 68.73 million people are willing and able to work in the country, and out of this 64.01 million were employed, and 4.71 million were unemployed.

Furthermore, the Refined Labor Force Participation rate was at 44.8% during FY19, suggesting that 44.8% of the potential workers in the economy are able and willing to work. If we divide it by gender, the refined labor force participation rate stands at 67.8% for males, and 21.5% for females.

The literacy rate in the country stood around 62.4%, with the literacy rate for males at 73% and females at 51.5%.

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