New Delhi, Feb 9 (NationPress) The economic growth of Pakistan in 2025 has been described as lackluster, with persistent high unemployment rates and a worrying rise in youth unemployment, highlighting issues of low productivity and insufficient job creation, as noted in an article from East Asia Forum.

During the fiscal year 2024–25, the country’s economic growth hovered around 3 percent, just keeping pace with the population increase, while the unemployment rate remained elevated at 8 percent. The article emphasizes that a sustained growth rate of 6–7 percent is crucial to accommodate new entrants in the labor market and mitigate unemployment.

The economy struggles to provide productive employment for over 3.5 million new job seekers annually. The youth unemployment rate for those aged 15–29 climbed to 11.5 percent, significantly higher than the national average, particularly affecting educated young individuals, according to the article.

According to Pakistan’s Household Integrated Economic Survey 2024–25, there has been a decline in real per capita consumption of key food items, indicating distress among households, with the number of earners per household decreasing from 1.86 to 1.72 between 2018–19 and 2024–25.

Notably, remittances presented a paradox in 2025. With exports and foreign direct investment remaining subdued, remittance inflows surged to a record $38.3 billion during the fiscal year 2024–25, becoming the most dependable source of external financing for Pakistan. However, the increasing dependence on remittances has coincided with a decline in domestic earning capabilities and reduced household food consumption.

Remittances as a percentage of household income climbed from 4.96 percent in 2018–19 to 7.77 percent in 2024–25, increasingly serving as a form of distress insurance rather than as development capital, signaling weak domestic job creation, the article observes.

These observations highlight a deeper structural challenge within Pakistan’s economic framework. Current policies have focused more on inputs rather than outcomes. The 13th Five-Year Plan (2024–29) set ambitious targets for exports, productivity, and inclusive growth, yet the implementation has been ineffective and superficial.

Exports have stagnated around $32 billion, private investments have been lackluster, and public investments have yielded poor returns, the article adds.

The core issue for Pakistan is not a lack of reform ideas but rather ineffective execution, with delays and regulatory hurdles hindering productivity growth. As 2026 approaches, Pakistan must prioritize time and performance as essential policy variables, enhance investment efficiency, and convert stabilization efforts into productivity and job growth, the article concludes.