Pakistan is struggling to create enough jobs for its rapidly expanding workforce, with one in every six new labour-market entrants unable to find employment, according to the World Bank.
The finding is more precise than saying “one in six Pakistanis is jobless.”
The World Bank’s current Pakistan assessment says around 3.5 million people enter the workforce every year, while job creation has failed to keep pace with the increase in labour supply.
What Is Pakistan’s Unemployment Rate?
The World Bank reports an unemployment rate of around:
7% in 2024.
But the broader problem goes beyond the headline unemployment rate.
The Bank says employment growth has not been strong enough to absorb Pakistan’s expanding working-age population.
One in Six — What Does It Actually Mean?
The latest figure does not mean one in every six people living in Pakistan is unemployed.
It means approximately one in six new people entering the labour market is unable to find work.
That distinction is important because the overall population includes children, students, retirees and people who are not participating in the labour force.
Millions Enter the Workforce Every Year
Around 3.5 million people enter Pakistan’s workforce annually, according to the World Bank.
Creating enough productive jobs for such a large number of workers requires sustained economic growth and substantially stronger private-sector investment.
Pakistan Created Jobs — But Quality Is a Problem
Pakistan has created around 17.7 million net new jobs since 2018.
However, the World Bank says most of those jobs have been:
- informal;
- low paid; or
- self-employment.
Economy-wide labour productivity increased by only around 0.4% annually between 2014 and 2024.
That means simply counting jobs does not capture whether workers are obtaining stable and sufficiently productive employment.
Real Wages Have Fallen
The labour-market pressure is also visible in earnings.
According to the World Bank, real wages declined by an average of around 3.4% per year between 2018-19 and 2024-25, as labour supply increased faster than demand and nominal wages failed to keep pace with inflation.
Poverty Has Also Increased
Weak job creation and falling real incomes have contributed to a deterioration in household living standards.
The World Bank estimates that Pakistan’s national poverty rate increased from:
22% in 2018-19
to approximately:
29% in 2024-25
with around 70 million Pakistanis living in poverty under the measure used in its current assessment.
What Does the World Bank Recommend?
The World Bank argues that macroeconomic stability alone will not be enough.
Pakistan needs reforms that allow the private sector to invest, expand and create more productive employment.
That includes improving:
- the business environment;
- private investment;
- productivity;
- access to finance;
- skills;
- female workforce participation; and
- opportunities for young workers.
Pakistan would also require significantly faster sustained economic growth to absorb the millions of people entering the workforce.
Pakistan’s labour-market challenge is not accurately described as “one in six Pakistanis being jobless.”
The more meaningful figure is that one in six new entrants into the workforce is unable to find work, despite millions of jobs being added since 2018.
With around 3.5 million new workers entering the labour market every year, creating more — and better — jobs remains one of Pakistan’s most significant economic challenges.
