The latest Labour Force Survey has shown that unemployment in Pakistan rose to 7.1 percent in the last fiscal year, marking the highest level recorded in 21 years. Officials revealed the findings in Islamabad, where Planning Minister Ahsan Iqbal attributed the increase to the impacts of the IMF stabilisation programme and severe climate-related disasters that disrupted economic activity.
According to the Pakistan Bureau of Statistics, the unemployment rate climbed from 6.3 percent in 2021 to 7.1 percent in 2024–25. This is the highest level since 2003–04, when unemployment reached 7.7 percent. Since that period, the national rate had largely fluctuated between 5.3 percent and 6.9 percent. The survey highlighted that Khyber-Pakhtunkhwa reported the highest unemployment at 9.6 percent, followed by Punjab at 7.3 percent. Balochistan recorded 5.5 percent, and Sindh had the lowest rate at 5.3 percent.
Minister Ahsan Iqbal explained that the IMF programme, signed last year for three years at a value of $7 billion, required Pakistan to implement nearly 50 policy conditions that restricted government spending and slowed growth. Combined with international price shocks and consecutive climate disasters, these factors weakened job creation and pushed more people into unemployment.
The survey emphasized the scale of unpaid work in the country. Out of nearly 180 million people of working age, an estimated 118 million—two out of every three individuals—are engaged in unpaid work such as domestic duties, livestock rearing, water collection, childcare, and small-scale household farming. The data indicated that about one-fourth of these individuals are solely occupied with domestic tasks, nearly 19 percent work with livestock, 23 percent provide childcare, 7 percent collect water for household use, and another 7 percent raise poultry at home. The report also referenced earlier government claims, including the idea promoted by former prime minister Imran Khan that household poultry farming could be a means of generating income, noting that a significant portion of working-age people are already involved in this activity.
Among the 5.9 million unemployed individuals identified in the survey, around 4.6 million are literate, while nearly one million hold educational degrees but are still unable to secure jobs. The highest concentration of unemployed individuals falls within the youth demographic, particularly in the 15–29 and 15–24 age brackets. Economists have warned that Pakistan’s economy, which has grown below 3 percent for several years, is not generating enough opportunities to absorb the 3.5 million new entrants who join the labour market annually.
The survey also documented a shift in employment patterns. As economic activity moves away from agriculture and toward services, the share of agricultural employment fell by four percentage points to 33.1 percent. Manufacturing employment also declined slightly to 14.4 percent, reflecting ongoing challenges such as high energy tariffs, double-digit interest rates, and heavy taxation. Meanwhile, wholesale and retail trade expanded its share to 16 percent of total employment, suggesting a growing reliance on small businesses and informal commercial activities.
Officials acknowledged that several recent reports, including the livestock census and the newly released Governance and Corruption Diagnostic Assessment, have been published as part of Pakistan’s commitments under the IMF programme. The Labour Force Survey itself was based on responses from 54,832 households and used updated international standards adopted from the 19th International Conference of Labour Statisticians. These new standards distinguish between paid employment and unpaid household production work, which means many people who were previously counted as employed are now classified outside the labour force. As a result, labour force participation and employment figures may appear lower, while unemployment appears higher, offering a more accurate representation of participation in paid economic activities.
The latest data shows that Pakistan’s labour force grew from 71.8 million in 2020–21 to 83.1 million in 2024–25, confirming that millions of individuals are added to the workforce each year. Within the labour market, employees represent the largest category at 43.5 percent, followed by own-account workers at 36.1 percent, contributing family workers at 19.1 percent, and employers at 1.3 percent. Women are disproportionately represented in contributing family work, while half of all male workers fall under paid employment.
The survey also highlighted the dominance of the informal sector, which accounts for more than 72 percent of all non-agricultural employment. Informality is more prevalent in rural regions, while formal jobs tend to be concentrated in cities. In terms of wages, the average monthly earnings of paid employees rose from 24,028 rupees in 2020–21 to 39,042 rupees in 2024–25. Male workers’ wages increased from 24,643 to 39,302 rupees, while women’s wages increased from 20,117 to 37,347 rupees. Officials added that the wage gap between men and women narrowed significantly over the survey period.
The findings further underscored the critical role of women in unpaid care work, noting that more than 45 million women are involved in domestic chores, 32 million participate in livestock-related tasks, and 20 million are responsible for caregiving duties. These contributions remain essential to household survival and rural economies, yet they do not translate into formal employment or income.
