Why does unemployment persist in Pakistan?
Different economic schools of thought suggest different policies to tackle unemployment.
Unemployment observed in Pakistan is mainly Structural, Seasonal and Cyclical. There are other factors too such as voluntary and involuntary unemployment, but these three particular factors largely impact unemployment rate.
According to the Federal Bureau of Statistics, Pakistan’s weekly inflation went up to 23.11pc on weekend of February 4th, 2009 over the same period of last year. In 2008 this figure of 23.11pc was only 7.40pc. According to the Federal Bureau of Statistics, the inflation was 22.56pc on the last week of January, 2009 but showed that it had increased 0.55pc during the week. Countries such as U.S has unemployment rate of about 8.10, U.K has 5.50 and Afghanistan has about 40pc. The unemployment rate in our country shows that inflation and unemployment is rising at an alarming rate.
There are currently estimated 231,289 educational institutions in the country. Their overall enrolment is recorded 34.84 million with teaching staff of 1.37 million. Pakistan’s current population is 160.9 million with a growth rate of 1.80 percent. 160.9 million Population out of which enrolment of students is just 34.84 million! Police experts say that the combination of poverty and unemployment has allowed gangs and organisations to target young people and steer them towards a path of criminal activity. A student of MBA said that where you went to school counts as much as having the right contacts: “These labels on your CV count. In such cases, we are rejected even before we apply”. “Those with connections get the job even before our CVs are looked at!” He said that this continual rejection often forces graduates to turn to crime.
In European and Western countries government is bounded to give about 10 million worth financial support to individuals doing PhD. According to a study, universities in Washington and Tokyo only, pass out more PhD Doctors annually then the entire Islamic countries can in more than two or three years. Improper availability for education also creates unemployment eventually causing psychological disorders.
Unemployed individuals are unable to earn money to meet financial obligations. Failure to pay mortgage payments or to pay rent may lead to homelessness through foreclosure or eviction. Unemployment increases susceptibility to malnutrition, illness, mental stress, and loss of self-esteem, leading to depression. According to a study published a few years back, stated that even those who tend to be optimistic find it difficult to look on the bright side of things when unemployed. While a study on the Influence of the Social Environment on Psychology by Brenner found that for every 10pc increase in the number of unemployed there is a 1.2pc in total mortality, a 1.7pc increase in cardiovascular disease, 1.3pc more cirrhosis cases, 1.7pc more suicides, 0.4pc more arrests, and 0.8pc more assaults reported to the police. During a long period of unemployment workers can lose their skills, causing a loss of human capital. Being unemployed can also reduce the life expectancy of workers by about 7 years. High unemployment can encourage racism as workers fear that outsiders are stealing their jobs.
Unemployment also encourages use of drugs by individuals. Official figures suggest that just three percent of Pakistan’s four million drug addicts are women. However, many believe the actual figure is much higher. Economist Kaiser Bengali attributes the rise in crime and drug use to the extreme “wealth gap” found in Pakistan’s larger cities, “When the level of economic activity is insufficient, it can lead to unemployment and naturally inequality”. There is another psychological dilemma in Pakistan about the male feeling ashamed of working under a woman. Lack of women development is also a reason in the barrier of progress of our country. According to United Nation Population Fund (UNPF) report there are 53 Islamic countries in which women don’t participate in any kind of job for income. On the other hand, a survey of 189 countries has shown that the mate is selected only on the base of his or her being employed.
With all these circumstances at hand not only our government but we as citizens of Pakistan should also take bold steps to cover and control unemployment. An idea came from economist and philosopher Andre Gorz, he argues that the idea of working less so everyone can work and that a basic income for all can be the solution. Problems and solutions are placed side by side all we need to do is be sincere with any work that we do.