Study spotlights low labour productivity

Pakistan’s economy relies heavily on unpaid labour, researchers say

ISLAMABAD:

A study revealed that people in Pakistan work for a lower proportion of their lives than other countries, exhibit less productivity in jobs and yield lower incomes.

These are the findings of a groundbreaking National Transfer Accounts (NTA) study carried out by the Pakistan Institute of Development Economics (PIDE) and the United Nations Population Fund (UNFPA).

The study revealed that the economy of Pakistan heavily relies on unpaid labour, especially, women’s labour, which is often overlooked.

The study invites a serious debate as the trend observed world over is that people are working for longer parts of their lives and are more productive in their jobs.

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One of the study's key findings shed light on the household spending patterns across Pakistan. Using the latest dataset, the study analyses household consumption of goods and services, including durable and non-durable goods, but excluding health and education, to provide a detailed glimpse into the spending habits of Pakistani households.

The study shows that in Balochistan, people mainly depend on paid income activities, while self-employment earnings usually start after the age of 50. On the other hand, self-employment in the province of Khyber Pakhtunkhwa begins at a younger age.

Most of the population in Balochistan depends upon government schooling while in Punjab the majority relies on private schooling. However, for higher education, most rely upon the services of government universities.

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According to the NTA methodology, two-thirds of mixed-income is allocated to self-employed income, referring to earnings from the labour of self-employed individuals.

This approach highlights the economic value of labour that is not traditionally compensated through wages or salaries. The pattern of labour income across all four provinces is consistent. Labour income increases with rising labour force participation and peaks between the ages of 35 to 50.

The study emphasises the economic contributions of unpaid labour and highlights the need for policies that recognise and support these essential yet unacknowledged segments of the workforce.

The NTA study further highlighted lifecycle deficits and public consumption patterns across the provinces, offering critical insights into the broader economic scenario. It did so by analysing the economic lifecycle of people, which comprised their consumption, labour income and resulting deficit or surplus.

Published in The Express Tribune, December 26^th, 2023.