INTRODUCTION

• Unemployment is a global phenomenon.

Mostly the problem occurs in developing
countries of the world, which not only
affects them socially but also
psychologically. The study focuses on the
causes and consequences of
unemployment in Pakistan and attempts to
offer recommendations for its alleviation.
 SEQUENCE

• PART 1.

a. UNEMPLOYMENT

b. TYPES OF UNEMPLOYMENT

CAPT MUHAMMAD ZIA BASHIR KHAN

 SEQUENCE

• PART 2.
a. MEASURING UNEMPLOYMENT

b. UNEMPLOYMENT IN PAKISTAN

MR. MUNAWAR REHMAN

 SEQUENCE
• PART3.
a. FACTORS OF UNEMPLOYMENT
IN PAKISTAN

MR. AMIR ANWAR

 SEQUENCE
• PART 4.
a. CONSEQUENCES OF
UNEMPLOYMENT IN PAKISTAN

MR. JAMIL KHAN

 SEQUENCE
• PART 5.
a. RECOMMENDATIONS

MISS UZMA

• CONCLUSION

• FAQS
UNEMPLOYMENT
 UNEMPLOYMENT

• Unemployed
– A person is said to be "unemployed" if he or she is looking for
work, is willing to work at the prevailing wage, but is unable to
find a job.

• Unemployment
– Unemployment refers to the condition of being unemployed, or
to the number or proportion of people in the working population
who are unemployed.

– ILO (International Labour Organisation) measure– the number

of people available for work and actively seeking employment
TYPES OF UNEMPLOYMENT
 VOLUNTARY UNEMPLOYMENT

• Unemployment when attributed to personal

decisions.

– Leaving one job and looking for another

 INVOLUNTARY UNEMPLOYMENT

• Unemployment when attributed to the socio

economical environments(external
environments).
– Modern trends in technology.
 LONG TERM UNEMPLOYMENT

• The condition of unemployment for more than

one year there by leading to social exclusion.
 SHORT TERM UNEMPLOYMENT

• The condition of unemployment less than a

year is referred to short term unemployment

– Fresh job seekers

– Switching employees
 FRICTIONAL UNEMPLOYMENT
• Frictional Unemployment - dynamic labor force in a
stable economy with imperfect information.

• It occurs when a worker moves from one job to another. While he

is searching for a job, he is experiencing frictional unemployment.

• Fresh graduates

Short term

Promoters
– Imperfect information
– disincentives
 STRUCTURAL UNEMPLOYMENT
• Structural Unemployment - stable labor
force in a dynamic economy with mismatch
between skills of labor and skills demanded.

• Caused by a mismatch between jobs offered by

employees and potentials of employers

• Tech bubble

• Long term
 SEASONAL UNEMPLOYMENT
• Seasonal Unemployment - unemployment that results
from the normal seasonal change in aggregate
economic activity or environment.

• Tourism

• Sky diving

• Training activities

• variable
 CYCLIC UNEMPLOYMENT
• Cyclical Unemployment - stable labor force in an
unstable economy. Unemployment that results
from a decline in aggregate economic activity

• Demand Deficient Unemployment – where AD is

less than AS
• Great depression of 1930
• Present state
 CLASSICAL UNEMPLOYMENT

• Real Wage or Classical Unemployment –

caused by wage rates being held above
market clearing levels
TECHNOLOGICAL UNEMPLOYMENT

• Technological Unemployment – caused where

people are put out of work by changes in
technology

• Down sizing because of advancement

GEOGRAPHICAL UNEMPLOYMENT
• Geographical unemployment:-
occurs due to geographical immobility of
labor
• Incentives for investors
• Reducing barrios to free movement
 THIN LINING UNEMPLOYMENT

• Hidden unemployment
• Casual unemployment
BRAIN CHANGE
MEASURING UNEMPLOYMENT
MEASURING UNEMPLOYMENT

UNEMPLOYED EMPLOYED

LABOUR FORCE
MEASURING UNEMPLOYMENT
Worked one or
more hours Yes
for pay? Employed
No

Temporary Yes
layoff? Unemployed

No

Searched for Yes

work? Unemployed

No

Not in Labor Force

 MEASUREMENT OF UNEMPLOYMENT

Employed persons
+ Unemployed persons
= Total labor force
+ Not in labor force
= Civilian noninstitutional population (16 and over)
MEASURING UNEMPLOYMENT

Unemployment Rate (percent)

= Unemployed X 100
Total Labor Force
UNEMPLOYMENT IN PAKISTAN
 UNEMPLOYMENT IN PAKISTAN
LABOUR FORCE
• 50.58 million
• country comparison to the world: 11

LABOUR FORCE BY OCCUPATION

• agriculture: 43%
• industry: 20.3%
• services: 36.6%

UNEMPLOYMENT RATE
• 2009 : 7.40%
• WORLD RANKING : 92
UNEMPLOYMENT IN PAKISTAN
UNEMPLOYMENT IN PAKISTAN
GEARING UP
FACTORS OF UNEMPLOYMENT
 FACTORS OF UNEMPLOYMENT

Landless rural
area
Decreased
investment
Nepotism

Population growth
Insurgency

Globalistation
 FACTORS OFUNEMPLOYMENT
• Poor Governance: Good governance is an
essential pre-condition for employment as it
establishes the enabling regulatory and legal
framework essential for the sound functioning of
land, labor, capital and other factors of market.
Whereas, good governance is considered to be
non-existent in Pakistan and poor governance is
taken one of the key underlying causes of
unemployment in Pakistan.
 FACTORS OF UNEMPLOYMENT
• Lack of Education & Rampant Illiteracy: The
country’s education indicators portray a dismal
picture when compared with other countries.
More specifically, the public expenditure on
education have been around 2% in Pakistan
compared to other (low income) countries of the
region. Since, foundation of any development in
socio-economic sector is corollary to the level of
education / skills of its human capital therefore,
general perception that one of the main causes
of the unemployment in Pakistan is pitiable state
of education across the country.
 FACTORS OF UNEMPLOYMENT
• Landlessness in Rural area: Being from an
agricultural country, most of the people of
Pakistan have farming as their primary source of
living. This source is shrinking with the division
of lands amongst the family members and
increasing population thereby depriving
honorable way of living to the families
furthermore increasing unemployment.
 FACTORS OF UNEMPLOYMENT
• Non-Transparency in Resource Allocation:
The lack of transparency in public sector
planning, budgeting and allocation of resources
in Pakistan has been the hallmark of our
financial resource planners and policy makers.
Political or the ruling leadership has never
responded to the real needs of the populace and
accountable to the promises they made with the
public. Resultantly, without having regards of the
real stakeholders or the potential beneficiaries,
the priorities for the development were
determined by the bureaucracy
 FACTORS OF UNEMPLOYMENT

• Political Instability: Political stability is

fundamental to the creation of an enabling
environment for growth and development.
Economic agents, particularly investors, must be
reassured with regard to the continuation of
policies, should have confidence in the
government’s credibility in order to operate
effectively, and in the case of investors, be
induced to take risks. Unfortunately the political
dilemma has furthermore cornered this issue
 FACTORS OF UNEMPLOYMENT
• Insurgency : The perceived security threat on
its eastern border that has dominated
Pakistan’s political culture, followed by
continuous threat on western borderand war
against terrorism as first line state . All these
factors have in turn affected growth, and
subsequently unemployment levels in the
country.
 FACTORS OF UNEMPLOYMENT
• Corruption & Corrupt Practices: Corruption is
one of the most dangerous factor that eroded
Pakistan’s economic and governance system
since its inception.
• In 2008, Pakistan was ranked as the 46th most
corrupt country out of the 180 countries of the
world. The persistently rampant corruption in
Pakistan not only jeopardizes its resolve to fight
against unemployment rather adding to the
menace of unemployment from all direction.
FACTORS OF UNEMPLOYMENT
 FACTORS OF UNEMPLOYMENT
• Nepotism: nepotism at every level in Pakistan
has polluted the environment both
socioeconomically and psychologically, the
employee who suits the jobs best is kept
deprived to flourish his abilities.
• Globalisation: it has further increased the
menace of unemployment in two basic ways
a. Brain drain
b. Global recession
 FACTORS OF UNEMPLOYMENT
• Social order: in Karachi, Balochistan ,Punjab
and almost every parts of the country
supplemented with war against terror has
retarded Pakistan production process. The
worsening situation is affecting the social
order as a whole and adding to uncertainties
in business circles, thereby increasing
unemployment in the country.
 FACTORS OF UNEMPLOYMENT

• Population Growth: Due to rapidly increasing

population the problem of food shortage in most
developing countries are compounded by inadequate
provision of basic services such as health and
sanitation facilities, shelter and safe drinking water,
also lack of education and increasing unemployment.
Owing to shrinking developmental funds visa vise
population growth. Resultantly the phenomenon
gives further rise to the unemployment rate.
 FACTORS OF UNEMPLOYMENT

• Privatization: is yielding opposite results then

the intended ones. National assets are going
in to foreign hands, companies are
monopolizing their ownership, they downsize
and do not except the existing criteria,
thereby playing a solid role in unemployment
 FACTORS OF UNEMPLOYMENT

• Declining Foreign Investment: Owing to number of

factors Pakistan has not been able to attract needed
level of FDI despite its pro liberalization and investor
friendly policies. These factors include; political
instability, rising trend in terrorism, social disorder
and unsatisfactory law and order situation particularly
in the, city of Karachi, the largest industrial and
commercial Centre and the only port of the country.
thus feeding the unemployment rates.
 FACTORS OF UNEMPLOYMENT
• Energy crises: Leading example in this case is
the textile industry of Faisalabad, where
almost 70% of growth has been jeopardized
because of energy crises thereby increasing
unemployment.
LINKING A-HEAD
CONSECUENCES
 CONSEQUENCES
• Individual effects:The individual costs for the unemployed
– Loss of income
– Fall in real living standards
– Loss of self-esteem
– Increased health risks
• Stress
• Reduction in quality of diet
• Social exclusion because of loss of work and income
– Deskilling and demotivation
 CONSEQUENCES
• Social effects
– Low morale values
– Security threats
– Increase crimes
– Family breakdowns
– Vandalism
– Increased involvement of foreign elements
(MOSSAD, RAW, CIA, MOIS, NDS)
 CONSEQUENCES
• Economical effects
– Fall in sales
– Fall in profits
– Fall in revenue
– Decreased economic growth
• Positive aspects
– Bulk of employers always available
– Less turnover
KEEP AWAKE, BORING PART IS OVER
RECOMMENDATIONS
 RECOMMENDATIONS
• Good governance
• Education
• Transparency in resource allocation
• Stable political government
• Refined policies
• Continuity of policies
• Security of investors
• Broadly defined internal security plans
 RECOMMENDATIONS
• Security of investors
• Broadly defined internal security plans
• Advanced skill refresher courses
• Check and balance
• Better strategies and planning
CONCLUSION
line in Pakistan’s present a depressing challenge for our
socio-political gurus and economic managers.
unemployment in Pakistan can only be alleviated by
sharpening the human capital by improving literacy and
investing in skill development, good governance,
community empowerment, long term economic growth,
socio- political justice and real term democratic culture.
The international community under the guise of Friends
of Pakistan on 17th April 2009, at Tokyo rallied to
support Pakistan’s economic program with more than
healthcare and social justice for all in stable social order.
YOUR QUESTIONS ARE SIGN OF YOUR INTEREST
AND OUR SUCCESS

GO AHEAD
ITS TIME FOR CHAGNE

!!!