1.

INTRODUCTION
In Pakistan, the unemployment rate is very high and the major reason is the wastage of
resources on the large scale. It results in the decrease in the income of people. The
Unemployment Problem in Pakistan is increasing rapidly and due to this, many crimes are
taking place.
We can see that many people no matter, what the education are idle because they are not
getting any job not even the jobs of clerks, in ordinary offices or in schools. The condition of
unemployment is leading towards the depressing state and the main reason is the poor
education system, which is running under the government.
The parents spend huge amount of money on their children’s education, but the jobs are very
rare and prove indefinable in today’s era. Sadly, the government is not taking any action on the
unemployment problem in Pakistan.The causes are infinite, but the major causes of
unemployment in Pakistan are
 Poor education system:
Governments took worthwhile steps for the betterment of education. We know that our
educational system is very bad and most of the population is uneducated. Many of the talented
students leave studies due to the unjust educational system. Many of the educational
institution are just selling degrees which have no values because the students do not gain any
skills but wonder for a good job because they are unemployed.
 Growth in population:
The population of Pakistan is very largeThere are many reasons for this increase in population
e.g. lack of awareness, desire of sons etc.
 High age of retirement:
The age of this retirement is very high i.e. 60 years due to this a lot of deserving people are
waiting for jobs.the less age people are in wait of jobs and their higher education is making
them exasperated because of no job.
 Terrorism:
Another major cause of unemployment is terrorism. Pakistan is facing a terrible situation of
terrorism now a days.which is due to the lack of employment opportunities.
 Lack of industries:
Another reason for unemployment is that the number of industries is not increasing in
Pakistan. Shortage of capital is an important cause of unemployment in developing countries
like Pakistan. Low savings leads to low investment, which ultimately results in low capital
formation. When rate of capital accumulation is low, unemployment will be the natural
outcome of the situation.
According to ILO, there are 160 million unemployed people in the world and 40 percent of those out of
work are young people (World youth report 2003). Pakistan is no exception to this, not only
unemployment rates have been beyond reasonable limits but also a vast majority who fall prey to this
belongs to youth category (Labour Force Survey 2003-04, 2005-06).

According to 2011 survey, the unemployment has been increased from 5.6% in 2009 to 6% in 2011. This
increase has been measured for both males and females. Females are more unemployed (8.9%) as
compared to males (5.1%) (LBF Survey, 2011). Population of Pakistan is increasing rapidly as zafar et al
(2011) concluded that population growth is the real cause of unemployment in Pakistan and the
Population growth in Pakistan is currently registered at an annual rate of 2.1% which is one of the
highest in the world.

According to the 2017 surveys the unemployment rate of Pakistan is about

5.9% of its total population. Like other major issues prevailing in Pakistan,
unemployment is also the largest one.
On the other hand resources are declining day by day as Chaudry and Hamid (1998) 171
concluded that less number of resources are the main reason of unemployment and Qayyum
(2007) founded that a large number of educated young people are facing higher unemployment
rate in Pakistan. Gender participation in labor market is also increasing in Pakistan. Due to the
globalization and changing patterns of the society the women are also willing to participate in
labor force to run their families, the Results of Naqvi and Lubna (2002) also indicates that
women participation in economic activities increase with age in Pakistan and conclusions
indicates that there is a higher evidence of unemployment among female youth in Pakistan. In
the current circumstances of Pakistan the tendency of both genders towards education is very
high. Educated youth including males and females drop their c.v in different governmental and
non-governmental organizations and institutions but unfortunately seek negative response
from the job market. Some jobs like receptionist etc are associates to the females only due to
the attraction of the opposite sex but on the other side some jobs are appropriate only for the
male segments that’s why there is a strong gender biasness and discrimination exist in job
market.
As observed in various countries the unemployment graph accounted for age specification
reveals a U shaped pattern high unemployment in the initial phases or among youth category, a
moderate trend for the middle age group people and again highly intensive among old.
Pakistan’s trend is not far apart from this general trend. Moreover distribution of unemployed
according to gender figures out high unemployment rates on the part of females. The recent
government programmes have contributed to a high degree in confiscating the child labour by
launching the educational campaigns rigorously and by increasing the enrolments at primary
levels especially in urban areas.
The long-run relationship between higher education development and unemployment Shows
the Results of long-run analysis indicate the negative and significant impact of higher education
development on unemployment in Pakistan. Results of variance decomposition method confirm
the valid unidirectional causal relationship of higher education development with
unemployment in Pakistan. The direction of a causal relationship is run from higher education
development to unemployment. Results of higher education development has remained
negative for last 15 years since 1999. It is clear from our findings that higher education
commission plays an important role in creating the employment opportunities in Pakistan,
which also leads to economic growth. It is recommended that policy makers should make
policies to strengthen the higher education commission. Policy makers should make policies
which are designed for promoting the fixed capital investments and increasing job
opportunities.