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Skills Development to Accelerate Economic Recovery during Covid-19


• The youth bulge in Pakistan offers a unique and timed opportunity to yield demographic dividend from a developed and economically productive workforce, however, this potential is far from being realised.
• Increased adoption of digital tools and resources during Covid-19 has added a new dimension to this lack of readiness and the “skills emergency” has exponentially exacerbated.
• The insufficient level of skills development in Pakistan is directly linked to the education crisis in the country. With high numbers of out-of-school children and dropout rates, there is no opportunity for the youth to acquire the crucial contemporary skills they need.
• The archaic approach of the Technical and Vocational Education and Training (TVET) sector in Pakistan has failed to address these

issues in any significant manner. Many institutions have attempted to adapt during Covid-19, but these initiatives will remain redundant
unless digital access is increased.
• Digital Skills across the primary, secondary and tertiary sectors can also add immensely to the post-Covid recovery of the country in two specific ways: reskilling for sectors that have been heavily hit by the pandemic, and new skilling for sectors that rely on digital channels.
• Skills development must be prioritised for all those impacted by Covid-19, with a specific focus on the most vulnerable segments of society. Digital skills must be
woven into education at all levels and market-based trainings must be provided at TVET institutes.

Identifying the Problem

Not only is Pakistan the fifth-most populous country in the world, it has one of the largest youth cohorts. This youth bulge uniquely positions Pakistan to yield a demographic dividend that will start to decline by 2030. The key to unlocking the transformative potential of this young population is human capital development. While the education emergency in Pakistan is well documented and continues to impede long-term socioeconomic development, the skills emergency also deserves immediate and serious attention from all circles. With 60 percent of Pakistan’s population under the age of 30, at least half of this group is eligible to be part of the labour force. However, 80 percent of the youth that constitute the workforce have “low education attainment and a poor skills base” [i], [ii]. Nearly half the working age population is illiterate and only 5 percent hold university degrees.

This crisis is aggravated by the annual addition of 2.1 million young people to the workforce — some of whom are educated, most of whom are unskilled and on the lookout for employment opportunities [iii]. Many from the graduate pool are gaining degrees from sub-par public and privates sector universities which are not adequately skilling students to compete in a globalised 21st century job market [iv]. On the other hand, global supply chains, the need for efficiency, and rapid automation in secondary and tertiary sectors has shifted employer preferences towards seeking high-skilled workers. This widening gulf between the demand and supply of skills in Pakistan is creating serious challenges for the economic aspirations of the country and the desire to create a knowledge economy. During the past decade, Pakistan has also deteriorated by 18 percent in the Youth Development Index rankings — the biggest slide for any country in the world [v].

To add to this dilemma, Covid-19 has accelerated the digitalisation process in Pakistan without significantly advancing the corresponding skillset to capitalise on this transition. During the last year, a sharp increase has been recorded in adoption of work-from-home, freelancing and digital methods in businesses, public sector institutions, education, and many other areas. Even though the Pakistan Telecommunication Authority has recently claimed that 87 percent of Pakistanis have access to the internet, not only is the quality of these services poor in many areas, it is also substantially skewed in terms of gender, geography and class [vi]. A majority of users in Pakistan, furthermore, have negligible digital skills beyond basic usage and social media apps [vii].

Why does this problem exist?

Pakistan’s chronic education challenges – including a high number of out-of-school children and dropout rates – severely limit acquisition and proficiency of basic skills like literacy and numeracy for a large youth cohort of the population. According to the World Bank, the learning poverty for Pakistan is nearly 20 percent worse than the average for lower middle-income countries, and 75 percent of children at a late primary age are not proficient at reading [viii]. Many of the 1.9 million who make it to tertiary education also drop out, leaving behind a small proportion of graduates from a segment which constitutes nearly two-thirds of the country [ix].

About 72 percent of Pakistan’s labour force is employed in the informal economy. A large proportion of these unskilled members of society have no access to formal skills development, alternative education opportunities, or avenues to develop soft or essential skills like financial and digital literacy. This creates a spiral of poor economic opportunities with no upskilling or reskilling to break out of this cycle.

It is also entirely unfeasible to expect that industries where these youths may be employed will train millions of unskilled employees at their own expense. Many public sector initiatives such as National Vocational and Technical Training Commission (NAVTTC) and Technical Education & Vocational Training Authority (TEVTA) exist to try and fill this vacuum — as well as autonomous non-profit funds. They provide and facilitate technical training programmes in priority sectors such as engineering, textiles, construction, and food industries and cover mechanical, electrical, plumbing and culinary skills, among others [x]. Considering meagre enrollment of 433,000 in 2018, their net impact in a country of 220 million people has been trifling thus far [xi].

The skills development programmes in Pakistan – public and private – have been unable to address the skills needs of the population thus far. With some exceptions, the technical and vocational education and training (TVET) sector can be classified as “woefully inadequate and antiquated”, while the World Bank has noted that over 75 percent of their graduates have some foundational skills but no marketable skills for employment [xii], [xiii]. The UNESCO Institute for Statistics (UIS) estimated in 2016 that around 25 percent of the Pakistani youth is illiterate with 8.2 percent unemployed having no vocational and technical skills [xiv].

Even in the formal economy, the nature of jobs is also changing from traditional workplaces, fixed hours and benefits to contractual work, consultancies and project-based employment in a gig economy. This shift has further escalated during the pandemic when service sectors such as hospitality and retail were worst-hit and unemployment rose to 9.56 percent [xv]. In the early stages of Covid-19 in May 2020, the ILO had already reported that one in six young people worldwide had stopped working because of the pandemic [xvi].

Pakistan’s gentle path towards digitalisation seems to have been fast-tracked during the first year of Covid-19. Schools switched to online learning, white collar jobs adopted WFH models and e-commerce has made the retail sector accessible to consumers from their devices. Many have been caught unaware by this transition and find themselves at a disadvantage by not being able to digitally adapt. Most others, however, have been left temporarily unaffected by this phenomenon because the proportion of Pakistan’s labour force that currently requires digital skills is meagre — an ominous indicator of how far behind the country is in the digital race.

The vocational training sector has found it particularly difficult to adapt to Covid-19 given its predominant reliance on in-person interaction across hundreds of different trades. Institutions like NAVTTC are attempting to mitigate these challenges using simulators at the 75 newly-established smart labs across the country, creating their own learning management system (LMS), and conducting online assessments. Meanwhile, a range of skills such as digital finance, entrepreneurship, e-commerce and programming languages are being pushed through institutes all over Pakistan. However, it is important to remember that TVET follows industry trends instead of creating them; although the trend may be progressively leaning towards digital, the success of skills development is heavily contingent on increased and equitable digital access.

Importance and Implications

Workforce skills refer to a wide-ranging knowledge and experience set that can enable individuals to perform professional tasks better. These skills form the backbone of any labour force, determine the economic trajectory and fate of a country and play a huge role across sectors such as health, education, entrepreneurship and livelihood development through SMEs. Developing a robust and skilled workforce can boost economic productivity and standards of living domestically, while enabling millions to be pulled out of poverty by facilitating respectable employment. Simultaneously, enhancing the long-term international competitiveness of Pakistan is also impossible without a holistic evolution of the skills spectrum: agenda, curriculum, delivery and assessment.

Besides setting the ground for the future, the aforementioned gap between the demand and supply side of the labour market can only be bridged by the reskilling and upskilling of the current workforce. These skills across the primary, secondary and tertiary sectors can also add immensely to the post-Covid economic recovery of the country by galvanising the shift towards a digital economy. This can be done in two specific ways: reskilling for sectors that have been heavily hit by Covid-19, and new skilling for important digital sectors such as e-commerce, financial services, data analytics, cyber security, etc. Although there is still only a small workforce associated with this transition – the impact of which has not been as ground-breaking as many would have hoped – it is gaining momentum, as well as drastically changing the skilling requirements in the job market. Basic digital literacy is now a prerequisite in many sectors and under-estimating its future trajectory can cost Pakistan enormously. It will be critical to enable our existing and upcoming labour force to become future-proof, as the world economy becomes increasingly connected, hyper-paced and virtually integrated.

Without a concerted effort to utilise the opportunity presented by this crisis and rapid reskilling, we risk exacerbating digital divides and structural inequities. If the largest segment of society, in particular, is not provided a conducive economic environment, there is a huge risk of the youth bulge turning into a “ticking time bomb” [xvii]. If not addressed urgently, we are risking massive unemployment, a collapsing economy, squashing the vulnerable, and being left with a workforce without skills or income.



Creating a policy alignment between digital, training and youth initiatives

The relationship between the government’s digital initiatives, skills development and youth entrepreneurship must be harmonised to ensure a cohesive national vision. With the government prioritising each of these three areas through individual agencies, policies and entities, it might be helpful to align all three closely-linked initiatives to weave a coherent skills development agenda that is cross-cutting and integrated. This will ensure a more integrated push, unify efforts and resources, and synergise outcomes for a range of scattered programmes.


Prioritising skills development for
all impacted by Covid-19

The government must, on priority, collect data regarding those affected and/or unemployed as a result of Covid-19 and incentivise them to join technical and vocational education and training programmes that are aligned with emerging needs. Workers must be empowered to pivot their skills in light of the shifts in the economy and society. Particular attention also needs to be paid to home-based workers belonging to segments with limited mobility due to gender or disability to ensure they have avenues to benefit from such skills programmes.


Expanding digital penetration and targeting underserved segments

It is an empirical fact that the benefits of digital access have not been equally dispersed across gender, geography and class boundaries. By opening these doors to all, it must be ensured that internet penetration to underserved areas is increased — particularly in Balochistan, Gilgit-Baltistan and the merged districts of Khyber Pakhtunkhwa. Similarly, inclusivity for women must be prioritised by offering financial incentives and basic trainings. The only chance for digital skills to truly function as an equaliser is by creating underlying ecosystems which are equitable.


Weaving digital literacy into education

The first layer of the “skills emergency” in Pakistan begins at school. The curriculum at primary, secondary and madrassah education must evolve to include digital literacy as a priority for all students. This ranges from basics such as using computers and smart devices, accessing information and self-learning to more advanced use-cases like coding, web development and graphic design, with integration of essential skills like financial literacy and internet safety. A robust skills programme can also be developed as a viable alternative for students dropping out of school or used as an incentive to draw out-of-school children back into the fold. These skills must be naturally scaled up for tertiary education, while also providing crash courses and lateral entries for adults returning to complete higher education.


Providing market-based skills training at public institutes

The gap between the demand and supply side of the labour market can only be remedied through skills development and training programmes. The public sector institutions that provide these, hence, must be aligned with the requirements of the market — not just locally, but internationally. TVET institutes must update their training methods and forge a connection with industries. The sector must focus specifically on growing areas such as food and beverage, tourism and hospitality, IT, health, agriculture and entrepreneurship, while ensuring budget reallocations for priority courses and sectors.


Incentivising private sector to invest in TVET

It is unlikely that the federal and provincial governments will be able to muster the resources to unilaterally fund TVET institutes across the country. If the private sector is incentivised to make investments in this field as well – as has been attempted with the Punjab government’s Parwaaz programme – the scale and impact of TVET can be increased manifold. In addition, concessions can be offered to certain industries to invest in the skills development of new and existing workers. This can take the form of tax incentives, the creation of specific institutes or funding training programmes, and also provides a direct employment linkage to trainees.

This material has been developed by Tabadlab in partnership with DRI. It has been funded by UK aid from the UK government; however, the views expressed do not necessarily reflect the UK government’s official policies.

End Notes

[i] “Why ‘leave no one behind’ must be at the core of Pakistan’s skills development agenda”. Amina Khan, ODI, December 4


[iii] “UNESCO Pakistan Country Strategic Document 2018-2022”. UNESCO, 2019.

[iv] “Is Pakistan’s education crisis responsible for the economic crisis?” Mishal-E-Noor, The Express Tribune, January 6 2021.

[v] “Global Youth Development Index and Report”. Commonwealth Secretariat, 2016.

[vi] “87% of Pakistanis Have Internet Access: PTA”. ProPakistani, February 2021.

[vii] “Social media outlets see surge in numbers of Pakistani users”. Ramsha Jahangir, Dawn, April 2020.

[viii] “Pakistan Learning Poverty Brief”. World Bank, October 2019.

[ix] “Education in Pakistan”. Robert Hunter, WENR, February 2020.

[x] “Pakistan: Providing Employable Skills to Youth in Punjab Province”. World Bank, October 2018.

[xi] “Why ‘leave no one behind’ must be at the core of Pakistan’s skills development agenda”. Amina Khan, ODI, December 4

[xii] “National Emergency on Skills Development in Pakistan”. Jawad Khan.

[xiii] “Youth Skills Training for Employment in Pakistan”. Muzammil Pasha, World Bank, October 2011.

[xiv] UNESCO Pakistan Country Strategic Document 2018-2022”. UNESCO, 2019.

[xv] “Number of jobless people to reach 6.65m in 2020-21”. Bakhtawar Mian, Dawn, June 2020.

[xvi] “ILO Monitor: Covid-19 and the world of work”. International Labour Organization, May 2020.—dgreports/—dcomm/documents/briefingnote/wcms_745963.pdf

[xvii] “The Pakistani Youth Bulge: A Ticking Time Bomb”. Erum Hafeez & Sajida Ali, Dawn, June 2017.


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