Youth unemployment in urban and rural areas of Pakistan has been a matter of concern over the past decade. Data from micro tapes of Labor Force Survey shows that in urban areas youth unemployment rate was 13.72 during 2001-02 whereas in rural areas it remained 10.06 during the same year. In 2012-13 youth unemployment rate was 12.80 in urban areas and it was 7.55 in rural areas of Pakistan. This suggests that unemployment rates in urban areas have always remained more than its rural areas. Over the last decade percentage point change in unemployment rate in urban areas is -0.92 whereas in rural areas the percentage point change of rural area is -2.51.
Alternatively youth employment rates in rural areas of the country have always been greater as compared to the urban areas. During 2001-02 youth employment rates in urban areas of the country were 36.86 where as in rural areas it was 43.13 suggesting that in urban areas employment rate of youth is less as compared to rural area. In 2012-13 once again employment rate of youth in rural area is greater than in its urban area i.e. 35.46 and 47.17 in urban and rural areas respectively. The percentage point change of youth employment rates in urban and rural areas were -1.4 and 3.88 respectively.
Now the question arises, which is the sector that employs greater number of youth? Data from Labor Force Survey suggests that in urban areas services sector employs greater percentage of youth whereas in rural areas more employed youth is concentrated in agriculture sector. However percentage point change of employed youth in services sector has not been substantially increased, as it shows a percentage point change of -0.4 during 2001-13 in its urban areas. Whereas in rural areas percentage of employment youth in agriculture sector has been increased, suggesting a percent point change of 2.2 over the past decade. Percentage of employed youth in rural area in agriculture sector was 54.39 in 2001-2002 versus 56.59 during 2012-2013, however percentage of employed youth in urban youth in services sector was 64.0 in 2001-02 which decreased to 63.60 in 2012-13 respectively.
Manufacturing sector is not contributing enough to buttress youth employment opportunities as the percentage point change of employed youth in both urban and rural areas was -0.29 and -0.1 respectively during 2001-13. During 2001-2002, 32.09 percent of the employed youth in urban areas were engaged in manufacturing sector whereas it decreased to 31.80 during 2012-13. In a similar pattern employment rate of youth in rural areas in manufacturing sector was 11.93 percent in 2001-2002 which decreased to 11.83 during 2012-2013. The percentage point change of employed youth during 2001-13 in manufacturing sector was -0.29 and -0.01 in urban and rural areas respectively.
Services sector employs highest number of youth in urban areas of the country. However its growth has not been increased substantially. Therefore more youth must been engaged, trained and given proper skill. Based on statistics from the Labor Force Survey and Economic Survey, there is clear message for policy makers that reforms should be introduced in agriculture sector in rural areas of the country, and micro-finance loans should be provided to people in order to encourage entrepreneurship. Manufacturing sector is once again lagging behind both in rural and urban area. Energy sector should be rehabilitated in order to improve employment opportunities in manufacturing sector.
Due to lack of credit, investment and unstable economy youth is facing unending employment issues. This agony can also be addressed by technology based solutions which help us to introduce more employment opportunities online. Now people can reach the global labor market through information and communication technology (ICT) that has enabled independent tech savvy workers to connect to potential employers who value their skills. Technology fuels entrepreneurship and ICT has reduced the distances to make the global market more accessible than ever which has minimized the gap between labor supply and demand.
Private sector is doing a great job. I am highly inspired by the World Bank, USAID and the Karakorum Area Development Organization (KADO) who have introduced entrepreneurship portfolio among youth by empowering them through advanced technology. Public attempts to empower youth have been fairly wrong. After the 18th Constitution Amendment in 2010 the subject of youth has been devolved into provinces however the ministry of youth affairs in each province is not working efficiently and in Baluchistan it is not even operational. Various projects including youth laptop scheme, youth loan scheme have not been successful in achieving their goal because youth is not trained properly. Due to the lack of training and skill youth is unable to use the resources and according to some cases they ended up in selling out the laptops back to market in order to earn money, which otherwise can change the game in terms of creating sustainable opportunities. Thus a public-private partnership is essential in order to evolve more technology based opportunities for youth.
Online job market is quite large and is expanding at a higher pace. According to World Bank in August 2014, 5 million jobs were posted on Elance.com which has a total worth of 5 billion dollars. More accurate data suggests that every second 15 jobs are created online, this reveals that how efficient and dynamic is the online labor market. Thus information and Communication Technology (ICT) is an antidote for anguish youth is facing in our country. Given this, there is dire need to create awareness and to train youth so that they can approach potential employers irrespective of the geographical boundaries.