PAKISTAN’S unemployment rate has hovered around six to seven per cent for nearly three decades. Policymakers cite it, donors reproduce it, and policy conversations move on (at least until the next Labour Force Survey). A persistently modest unemployment rate, by any standard reading, signals a healthy labour market that is functioning well. The economy is doing great in absorbing its workforce, job-seekers are finding employment, and whatever problems remain are at the margins. This is the underlying narrative of Pakistan’s labour market from the headline unemployment numbers. But it is misleading and wrong, not because the numbers are fabricated, but because the employment rate is the wrong number to look at. The truth is that the unemployment rate numbers in Pakistan hide more than they actually reveal.

The context is key here: Pakistan’s economy does not offer any comprehensive social protection such as unemployment insurance. In the absence of social protection, Pakistani workers simply cannot afford to be unemployed. They accept whatever is available: a corner in someone else’s shop, a day’s wage at a construction site, a few acres of someone else’s land. The result is a labour force that looks employed but mostly is not — definitely not in any sense that translates into security, productivity or a return on the education their families struggled to fund. So, the meaningful questions are not whether people are working but what they are earning, under what conditions, and whether any of it is connected to the skills they spent years acquiring. These........

© Dawn