The global economic turmoil has caused unemployment around the world and in Pakistan 3.4 million of the workforce is unemployed.
A mismatch in job and skills as well as the temporary nature of many
jobs is problematic. Certain segments of the labour market do not offer
secure employment, underlining the need for Pakistan to explore more
markets to export its manpower as well as provide incentives for
remittances to enhance its growth.
Globally, after the outbreak of the financial crisis, the outlook for
job creation has been worsening. The baseline projection of the
International Labour Organisation shows no change in the global
unemployment rate between now and 2016, standing at 6% of the labour
force.
Despite a moderate pick-up in output growth expected in 2013-14, the
unemployment rate is set to increase and the number of jobless worldwide
is projected to rise to more than 202 million in 2013, by another three
million in 2014 and a total of 206 million by 2016.
According to data compiled by the Pakistan Bureau of Statistics
(PBS), the unemployment rate in Pakistan dropped to 5.7% in the fourth
quarter of financial year 2012-13 from 6.5% in the fourth quarter of
2011-12.
Pakistan’s unemployment rate averaged 5.41% from 1985 to 2013,
reaching an all-time high of 7.8% in June 2002 and a record low of 3.1%
in December 1987.
Pakistan has the ninth largest labour force in the world. According
to the labour force survey, the total labour force is 57.24 million. Of
this, 3.4 million are unemployed.
In the presence of high circular debt, rising inflation, unemployment
and other macroeconomic imbalances, one factor that helped countries
reduce poverty and improve income distribution is overseas employment.
In order to achieve this goal, Pakistan can follow Bangladesh’s model
of manpower export. Recently, Bangladesh Minister of Welfare and
Overseas Employment Khandker Mosharraf Hossain visited Malaysia,
Indonesia and Singapore with a view to expanding the foreign job market.
On the external front, the Bangladesh economy is virtually reliant on
manpower and readymade garment exports, which have emerged as key
pillars for building the country’s foreign exchange reserves.
Remittances from overseas Bangladeshis contribute 11% to the gross
domestic product.
A comparison shows that manpower export from Bangladesh is higher
than Pakistan. According to the Bangladesh Welfare and Overseas
Employment Ministry, about 480,000 to 540,000 workers leave the country
annually while from Pakistan only 150,000 workers go abroad in a year.
It is important for Pakistan to focus on sending more skilled workers
abroad to raise earnings per worker. Otherwise, it will be tough to
step up the pace of economic growth as well as remittances.
At present, 48% of overseas Pakistanis are working in the Middle East, 28% in Europe and 19% in the United States.
Saudi Arabia has become the largest market for Pakistani workers.
Other Gulf states such as the UAE, Oman and Bahrain are also attractive
markets for manpower export. In 2012, the number of workers that went to
Saudi Arabia were 358,560 and to the UAE 182,630.
Worker remittances from overseas have been a major source of foreign
exchange over the last few years. The remittances provide significant
support to the balance of payments and also help stimulate the economy
and alleviate poverty.
According to data, remittances stood at $11.57 billion in July-April
2012-13 against $10.877 billion in the same period last year, an
increase of 6.37%.
Pakistan is the sixth most populous country with an estimated
population of 180 million and annual growth of 2%. It is expected that
Pakistan will become the fourth largest nation in terms of population by
2050.
The existing structure shows that the country has a 60% economically
active population or workforce. This workforce can be a productive asset
if properly trained through skill development programmes.
It is time to attach high priority to skill development to increase
per capita income of migrant workers. In this regard, the government
should initiate programmes for skill development and also explore
overseas employment opportunities, which will not only reduce
joblessness but will also enhance remittances.
The Ministry of Labour, Manpower and Overseas Pakistanis should send
government representatives to countries such as China, Kuwait, Malaysia,
Qatar, South Korea, Japan and the UAE to open up and withdraw
restrictions on Pakistani workers.
While formulating a new manpower export policy, the government should
take into account that because of a fall in oil revenues and rising
unemployment, the Gulf countries, including Saudi Arabia, will be
revising their manpower import policies, which may lead to the return of
hundreds of thousands of expatriate workers.
|
