‘Job growth tilts toward low-productivity services’

Pakistan’s employment expanded sharply over the past four years, but a Gallup Pakistan analysis of labour force participation in 2024-25, released on Wednesday, shows that much of the growth is concentrated in low-productivity and informal services rather than high-value industry, raising concerns about the quality, sustainability and long-term economic impact of job creation.

According to the report, total employment rose from 67.3 million in 2020-21 to 79.7 million in 2024-25, adding about 12.4 million workers to the labour force. While the headline numbers indicate robust job creation, the composition of employment presents a more cautious picture.

The services sector emerged as the main driver of growth, increasing its share of total employment from 37.2% to 39.9%, while agriculture’s share declined from 37.4% to 35.1%. Industry remained largely stagnant, with its share edging down slightly from 25.4% to 24.9%, the survey shows.

Arif Habib Limited (AHL) Economist Sana Tawfik said the data points to gradual structural adjustments rather than a decisive shift. She noted that services now employ close to 40% of the workforce, agriculture around 35%, and industry accounts for the remainder. Average monthly wages have risen to about Rs39,000, indicating some improvement in earnings alongside employment growth. Overall, the labour market is expanding and evolving, but still requires policies focused on productivity, formalisation and inclusive growth.

The report also highlights persistent gender disparities. Women remain heavily concentrated in agriculture, with 61.4% of employed women working in the sector compared with 24.5% of men, who are more evenly spread across commerce and services. This pattern points to limited access for women to formal and higher-productivity jobs.

JS Global Senior Vice President Waqas Ghani described the imbalance as striking, saying it reflects constrained employment opportunities for women, particularly outside rural and farm-based work. He stressed the need for broader, more inclusive job creation across sectors.

While the addition of 12.4 million workers signals a rebound, analysts caution that job quality and resilience remain weak. The economy continues to struggle to generate formal, skilled and productivity-enhancing opportunities. Analysts say sustained industrial growth is essential to absorb labour productively and ensure employment gains translate into durable incomes and competitiveness nationally.