Reaping the Demographic Dividend in Pakistan: Education, Skilling and Employment


Pakistan is in the middle of the demographic transition. The right investment in young people is required to realise the “demographic dividend”.

A cleanliness and plantation drive
Teaser Image Caption
A cleanliness and plantation drive arranged by the GYM club of the National Skills University, Islamabad

According to the National Human Development Report published by the United Nations Development Programme (UNDP) in 2018, 64% of the population is below the age of 30 and a total of 30% are between the age of 10 and 24 years i.e. 64.5 million. This trend will continue until 2050 with 1.9% average population growth between 2017 and 2030. The Total Fertility Rate (TFR) in Pakistan is on decline i.e. from 3.6 children in 2017-2018 to 3.3 in 2022. According to the Pakistan Demographic Survey 2020, the population will continue to increase despite further declines in fertility. By 2030, of a total estimated population of 280 million people, 100 million will be youth. This historical moment is a make-or-break situation for Pakistan.

The right investment in young people can open up numerous opportunities for the country’s future. However, if the country fails to channel the potential of young people, it could become a burden not only for the country but for the region at large. Does the country have a holistic approach, systems and infrastructure in place required for the smooth transition so that the country can reap the demographic dividend? This article looks at challenges and presents a number of voices connected to Pakistan’s “Green Youth Movement”.

Jobs and Skills Challenges

Every year a large number of young people enter the job market. According to the 2020-2021 Labour Force Survey, the unemployment rate is 6.3%, surely an improvement compared to 6.9% in 2018-2019, but still a major challenge. To fill the gap, the country has to generate 1.3 million jobs annually in the next five years.

As one of the major drivers of economic growth, young people in Pakistan display a dearth of required skills that becomes a hindrance in harnessing their potential. Time and again employers have hinted at the gap and mismatch of skills provided by the education system and those required by the industry at large.

At the moment, digital skills such as content creation and graphic designing are high in demand for young students like myself. Skills are important for long-term employment. However, there is a disconnect between demand and supply. There are very few opportunities in the industry for my services as a microbiologist. We [have to] work alongside studies. I have to miss my classes to cope with the work-based demands and the salary is too low. The system is not accommodative, so that the students can benefit from flexible hours at work to continue their studies. (Muhammad Dilawar, Master’s student in microbiology)*

Currently, Pakistan has the second largest number of “out-of-school children” (OOSC), i.e. 22.8 million children aged between 5 and 16 years do not attend an educational institution. Part of the problem is the low allocation of funds for education and the cumulative education expenditures accounted for 1.77% of the GDP in 2021 according to the Pakistan Economic Survey 2021-2022. Dropout rates are high on the post-primary level of education, due to non-availability of public schools, cultural barriers especially for girls such as early marriage, lack of female teachers and child labour owing to poverty. Those in public schools face learning challenges due to poor quality of teaching and curriculum with almost no civic education, technical, digital and transferable/soft skills which are important for workforce readiness. This poses a great challenge to the country’s human capital development. Meanwhile, Pakistan is faced with threats such as displacement caused by climate disasters  and the Corona pandemic which further exacerbated the situation in the past years and resulted in halted learning and increased number of school drop-outs.

According to an estimate, 31% of Pakistani youth are not in education, employment and training (NEET). Moreover, the education system does not provide soft or technical skills required by the industry at large. The Technical and Vocational Training Education Institutions (TEVT) in the country also lack quality content and linkages to the labour market. The TEVT courses do not offer soft skills such as adaptation, interpersonal, analytical, cognitive, communication, project management and problem solving to name a few, which are sought by the employers. Thus the graduates of TEVT are not always able to transition towards employment or entrepreneurship.  

Promoting Youth Entrepreneurship

The large number of young people entering the job market cannot be provided employment as there are far less formal jobs than employees. Pakistan’s economic situation requires a shift in the employment from jobs to entrepreneurship. However, the mindset for this is largely missing among young people.


It is the responsibility of universities to guide us about the future of work and provide transferable skills. We lack the knowledge and soft skills outside of course textbooks for our career development such as digital, communication, entrepreneurial and cognitive skills. During my sixth semester, I applied for internship at various organizations. However, my university didn’t provide me [with] reference letter, because as per the policy of the university, it supports internship only for the final semester students. We don’t have the required mindset to think outside the box for business ideas and innovations. The risk of entering the entrepreneurial space is linked to the lack of platforms to launch them and [limited] financial support from the system. At times, we need guidance to translate the idea into a business but we don’t have a platform. A student would instead provide his or her services as a freelancer. (Ushna Saeed, student of environmental sciences at the University of Veterinary and Animal Sciences in Lahore) *

Startups in Pakistan have mushroomed over the years owing to the joint efforts of the industries and the government. Pakistan was ranked among the top ten freelancing countries in the world according to the Global Gig Economy Index, i.e. 47% in 2019. In partnership with the private sector, the Ministry of Information Technology and Telecom established a number of National Incubation Centres across the country under the vision of increasing digitalisation. These centres incubate ideas, accommodate startups, build capacities of young entrepreneurs and establish linkages with potential investors. Since 2015, Pakistani startups have been able to generate USD 563.5 million and 62% of them were founded in 2021 alone. However, not all startups are able to gather such funds to become major businesses and, in the wake of inflation and international funding drying up, there is a risk that the industry might be impacted negatively.

In addition, the country needs to bridge the digital divide in terms of access, availability and skills especially among girls. Teaching the tech revolution should be made mandatory throughout all stages of the educational system and especially in higher education to develop their passions and goals. Higher educational institutions such as the Colleges of Technology should partner directly with the market, sending their students to receive hands-on experience and get to know how to grab an opportunity.

A cleanliness and plantation drive arranged by the GYM club of the National Skills University, Islamabad
A cleanliness and plantation drive arranged by the GYM club of the National Skills University, Islamabad

The Right Support Needed

Since 2013, subsequent governments have introduced a dedicated youth programme with a three-pronged approach to the development of young people i.e. education, employment and engagement. A loan scheme for young entrepreneurs of startups, a youth entrepreneurship scheme, skilling and international certification, TEVT sector reforms including the establishment of National Accreditation Council for TVET Stream, funding for innovation, as well as engagement programmes such as National Youth Council (NYC) and sports and environmental initiatives such as the “Green Youth Movement” have been introduced on federal and provincial levels. A national skills strategy speaks about the need for skilling, upskilling and reskilling of the existing labour force. The scale of the programmes cannot match the number of young people in need, especially in the rural areas. However, other actors such as bilateral and multilateral development agencies and private sector are also working in the same direction. The silo approach to the agenda of youth development is a major challenge that hinders scaling-up.

Some of the initiatives in the pipeline include national youth employment policy which ensures connecting employers and employees to make space for bridging the demand and supply of the skills available and required by the labour market. Moreover, the policy also explicitly talks about the facilitation of different kinds of employment streams, i.e. job and self-employment. We are mindful of the age-specific needs of the young people. It is important to ensure a cross-cutting approach to youth development where the basics of human capital development are ensured such as education, health and skilling needs. Digital skills are a priority and the Prime Minister has formed a task force around IT that focuses on e-commerce. The aim is to boost the IT export from the current amount of USD 2.6 billion to USD15 billion. (Muhammad Ali Malik, Deputy Secretary of the Prime Minister’s Youth Programme)*

The analysis of youth development landscape clearly shows that there are three main aspects that need attention to harness the potential of young people – education, both soft and vocational skills, and entrepreneurship. However, the life cycle approach to connect education to skilling and employment is largely missing. The concept of integrated skilling in adolescence or at school level is not a priority in the educational institutions. Despite efforts by the governments, the TEVT sector has so far been unable to match the skill needed of the future labour market such as the green and blue economy and the digital industry. The transition to decent work through quality education and soft and technical skills need to be a prioritised agenda for the various stakeholders in the arena.

A plantation and cleanliness drive organised by the University of Chakwal
A plantation and cleanliness drive organised by the University of Chakwal


In order to maneuver the demographic transition and to reap the demographic dividend, Pakistan needs to focus on three areas:

  • Reforming the education system to address the needs of the future through the right curriculum and integration of transferable, lifelong skills which can also be linked to the market demands facilitate self-employment. Technical skills including STEM and matric tech need to be introduced and scaled up in the formal schooling. Teachers training for effective delivery and provision of school infrastructure for girls especially beyond primary is a must. Besides those already enrolled in schools, there is a need to reduce the number of OOSC through accelerated learning programmes with integrated skills and market linkages.
  • Bridging the digital divide through training, and provision of infrastructure is the utmost need of the hour. Rural areas need to be connected, and trainings for young girls at school level with digital security could pave ways for future opportunities.
  • A majority of young people are aspired to look for jobs, whereas at present the need for entrepreneurship is even graver. There is a need to guide young minds not only to seek jobs but create them through school-based skilling around financial literacy and business analytics. On the other hand, policies that strengthen businesses are important along with the facilitation of the transition to online work.

*Quotations are from interviews with young people and policy makers conducted by the author.