Pakistan's Demographic Conundrum
Approximately 1.3 million annually enter the labor market, but the dependent population increases at the same time.
The structure of a country’s population has significant impacts on its economic activity. After all, economy is an aggregate of consumption, saving, and income at the national level. Therefore, the phenomenon of a generational economy has gained importance for developing countries. Pakistan, over the last 30 years, couldn't harness the advantages of its changing age structure due to rapid growth in the dependent population and a sluggish economy. The economy's growth has consistently fallen below the 7 to 8% needed to absorb the increasing youth population into productive employment. But with a declining fertility rate, does Pakistan have a chance?
The newly launched National Transfer Accounts by the UNFPA, aims to estimate the flow of income across generations especially to quantify the impacts of dependent population. Currently, 64% of Pakistan's population is composed of people under 30 years. The proportion of dependent population is higher in the form of people younger than 15, and lower in the form of people older than 60. Therefore, expenses on education and overall consumption by this cohort is the highest due to the ‘age-structure effect’.
In conclusion, the report finds that the expenses on education (for younger dependents) and health (for elder dependents) are fulfilled through private means. This causes a huge strain on the working population, who have limited employment opportunities in Pakistan today. Therefore, public funds should support households in sustaining the dependent population, in addition to ensuring skills development and employment for the younger population.
GRAPHIC
Implementing a strategy aimed at reducing the population in Gaza and relocating Palestinians from Gaza to Egypt, as seemingly pursued by the Israeli war cabinet, is becoming evident on the ground.
About 19% of Pakistan’s population faces challenges in financial literacy, hindering the use of digital financial services. Since digital finance has better outreach, it can play a significant role. However, this issue remains significant for women.
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About Us: Macro Pakistani is a data-driven research platform that aims to provide a basic understanding of Pakistan’s economy. If you have an interest in contemporary news but are currently overburdened with sensationalism and specialized vocabulary, we are the platform for you.
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