Creating Jobs to Serve Pakistan
Two months after a decisive national election Pakistan is beginning to spin out of control owing to weakening economic fundamentals. This is not what the voters expected when they ushered in democracy. Regardless, the country is facing rapidly rising inflation making it difficult for many to buy the basic necessities. At the same time the currency has nose-dived having already hit the all time low of 71 rupees to the dollar.
Economic collapse of some sort is looming on the horizon. Pakistan has a very primitive economy largely made up of backward agricultural sector as the major component. About 70 percent of the population lives in the rural areas surviving on subsistence work either as tenant farmers, peasants with small landholdings or landless farm-workers in bondage to landlords. They are all inefficient producers.
Only the landlords, who have a stranglehold on agricultural production, are well off. In fact, the country is at their mercy in food supplies. As a result there are perennial shortages, even in the best of times. The supplies are kept low so the prices would stay high. For the most part the landlords are the prime players in hoarding, black-marketing and other forms of economic evils that continuously afflict the country.
The only solution to the problem of agricultural mal-production is to abolish the feudalistic system of land holding. Unfortunately, the feudal lords also have a stranglehold on the government. Asif Ali Zardari, a prominent landlord and currently the most powerful political leader in Pakistan, will never consent to the breaking up of feudalism.
Zardari and others like him are indifferent to the plight of the thousands who enter the labor market each year. Ironically, he is the leader of the PPP, ostensibly a workers movement, but he couldn’t care less for the fundamental interest of the workers, that is, jobs.
For many people finding work to make a living has become a hellish nightmare. The main avenue for creating employment is an expanding industrial economy but in Pakistan a viable industrial sector hardly exists. During the past ten years attempts were made to institute industrialization though the result has been a patchwork of inefficient industries held together by a highly centralized colonial economy put in place by the British colonizers over a century ago.
A similar economic system existed in Britain two or three centuries ago though since then modernization has created a fundamentally different type of set-up. However, in Pakistan the colonial economy has remained largely intact.
Needless to say industrialization pursued without a vision for the future hardly produces good results. A coherent policy for an integrated economic development has never been adopted in Pakistan. The public however has been waiting for the evolution of such an economy. The leaders seem to be indifferent to the needs of the people and most of them do not really understand the workings of an economic system.
At the current rate of population growth Pakistan would need to create at least 50,000 jobs a month just to stay afloat. For a backward country with incompetent leadership that would be impossible. Even five thousand a month would be hard to imagine. At twice the population the US Bureau of Labor estimates that America needs 150,000 jobs a month. At that rate Pakistan would surely need more than half that number.
One of the most common sights in Pakistan, towns and villages, are the clumps of people just standing around with nothing to do. Of course, they could be put to productive work but jobs simply are not available.
If people had jobs they would be earning an income, making all kinds of payments, including for homeownership, buying goods and services, and contributing to individual and national wealth. Pakistan would be better off with higher per capita income and rising gross domestic product. There would be no reason for rampant poverty to exist.
However, Pakistan has a very high unemployment rate. It may be around forty to fifty percent. The non-participation of women in the labor market compounds this problem. The net result is the loss of income for families and underutilization of skills in service to the nation.
One of the reasons for unending social strife in the country is that people are idle with nothing to do and can be easily rounded up for mischief. That is one of the reasons for demonstrations, protest marches, riots and other forms of mob behavior that gets out of control and ends up in violence. Western media frequently comment at the readiness of people in Pakistan to join violent crowds.
By providing employment the leaders can make the country productive and prosperous. A number of Third World nations, Thailand, South Korea, China and Brazil, have done precisely that during the past forty years. In order to generate jobs Pakistan will have to pursue a meaningful industrialization policy. The model for that already exists even in the country next door, India.
Market incentives can be provided to the private sector to hasten the process of industrialization. Once private entrepreneurs and innovators become involved in an open economy progress is likely to be rapid.
Pakistan is hobbled by poverty due exclusively to the lack of leadership initiative. Prosperity is just around the corner if rational policies are followed in the pursuit of economic goals.
