The last three years have witnessed a negative combination of low GDP growth rate and high rate of inflation. This has led to two types of impacts. First, the unemployment rate has gone up drastically. Second, a large percentage of employed workers are likely to have experienced a fall in real incomes due to the high inflation. Combined, these two impacts have caused a spiralling up of the level of poverty incidence in the country.

The average GDP growth rate in 2022-23, 2023-24 and 2024-25 has been only 1.7 percent. The economy contracted in 2022-23 due to the floods. Four sectors absorb over 75 percent of the employed workers. These sectors are agriculture, manufacturing construction and wholesale and retail trade. The last three-year average growth rates of these sectors are as follows:

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Agriculture 3.1

Manufacturing -0.3

Construction -1.6

Wholesale and

Retail Trade -0.2

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Therefore, three of the four labour-intensive sectors have seen a decline in the overall real level of value-added. This is likely to have had the inevitable consequence of a big decrease in the number of employed.

The Population and Housing Census of 2023 determined the employment situation in Pakistan in the second half of 2022-23 and the first half of 2023-24. It reports that the labour force was almost 85 million. The number of employed workers was 66.2 million and the number of unemployed at close to 18.8 million. This implies an unemployment rate in the country of 22.1 percent.

The........

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