Pakistan’s education and skills do not automatically translate into higher earnings because the economy often creates too little productive work that uses them. LUMS Vice Chancellor Dr Ali Cheema, as reported by TechJuice, argues that weak demand for skilled labor is part of the problem. The World Bank’s skills assessment offers supporting labor-market context, but this is one part of a wider growth challenge—not proof that education has no value.
Why more education does not always mean higher earnings
Education can build skills, but the economic payoff depends on whether employers create jobs that use those skills and pay for them. In TechJuice’s account of Cheema’s remarks, Pakistan’s weak demand for skilled workers limits the rewards people can expect from education. Many jobs, the article says, remain concentrated in lower-productivity agriculture and services.
The World Bank’s Pakistan Skills Assessment for Economic Growth describes a labor market with extensive informal and low-skill work, alongside relatively low estimated returns to education. That assessment does not imply that schooling is worthless: it says education matters for entering formal-sector work and for occupational selection. Rather, the gains are constrained when productive, skill-using jobs are scarce.
What the World Bank figures do—and do not—show
The World Bank assessment reports an estimated return to education of 6.1 percent in Pakistan, compared with a 7.0 percent South Asia average. These are report estimates, not a guaranteed annual payoff for every person, degree, or qualification. The available material does not establish the report’s publication year or provide the full definitions behind the estimates, so the figures should be read as a comparative finding from that assessment, not as a current personal-income forecast.
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The same assessment estimates that 87 percent of Pakistan’s labor force works in the informal sector and that 63 percent are nonwage family workers in the informal economy. These are labor-market estimates from the report, not measures of the share of people who have no work. Informal and family work can involve substantial labor while offering less access to stable wages, formal protections, or roles built around specialized skills.
Education is one piece of a broader growth problem
Current World Bank country material identifies constraints that reach beyond schooling, including productivity, investment, exports, and human capital, as well as policy and institutional weaknesses. That broader picture matters: improving education alone cannot create demand for graduates if firms are not investing, expanding, and hiring into more productive activities.
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The World Bank reported Pakistan’s Human Capital Index at 0.41. Its October 2025 update said GDP grew 3.0 percent in FY2025 and projected 3.0 percent growth for FY2026. The FY2026 figure was a forecast made in October 2025, not a confirmed outcome. Together, these indicators provide context for the challenge but do not establish that any single education or labor-market factor caused a particular growth result.
Cheema’s reported comparison with Bangladesh should also be treated carefully. TechJuice says he argued that if Pakistan had matched Bangladesh’s growth pace since 1990, Pakistan’s average income would have doubled. This is a counterfactual attributed to him; the underlying method and data series are not established in the cited material, so it is not an independently verified estimate.
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1Clear out junk files and repair common Windows errors2Scan for outdated or missing drivers - takes under a minute3Repair Windows errors before they cause bigger problemsPolicy directions Cheema reportedly raised
TechJuice attributes three broad policy directions to Cheema. They address both the supply of skills and the economic conditions that determine whether those skills can be used:
- Increase public investment: The article says Cheema pointed to productivity-supporting areas including transport, security, and education. Better education can strengthen capabilities, while investment in infrastructure and security can support firms’ ability to operate and grow.
- Raise women’s participation in paid work: More women entering the labor force can broaden the country’s use of its skills and talent. Participation depends not only on education but also on whether paid work is accessible and compatible with women’s circumstances.
- Improve governance and coordination: The article describes Cheema’s emphasis on decentralization and stronger federal-provincial coordination. These reforms concern how policy is implemented across levels of government, not just what policy is announced.
These directions respond to different parts of the problem. A useful way to assess any proposal is to ask whether it creates demand for skilled labor, improves access and learning, expands women’s ability to participate in paid work, addresses productivity and investment constraints, and can be implemented consistently across institutions and political cycles. These are evaluation questions, not a ranking attributed to Cheema or the World Bank.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Why the education system and the economy must be considered together
In a related panel report, LUMS attributes to Cheema the statement, “The return to education in Pakistan is very low,” and the observation, “We can’t think about the education system without the economic system.” These quotations are from the LUMS panel account, not verified as verbatim remarks from the ThinkFest session described by TechJuice.
The distinction is important for households weighing education against immediate costs. The figures do not predict an individual’s earnings, and they do not show that education has no benefit. They point instead to a structural issue: skills are more likely to pay off when a growing, productive labor market can put them to use.
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Sources and scope
- TechJuice, “LUMS VC Highlights Pakistan’s Growth Crisis: High Skills, Low Returns” — account of Cheema’s remarks and attributed policy proposals.
- World Bank, Pakistan Skills Assessment for Economic Growth — education-return and labor-market estimates.
- LUMS, “LUMS Vice Chancellor, Dr. Ali Cheema Delves into Strategies for Sustainable Growth in Pakistan at Panel Discussion” — related panel context for the quoted remarks.
- World Bank, Pakistan country overview — country indicators and current growth context.
- World Bank, “Pakistan: Sustained Reforms Needed for Inclusive Growth, Economic Stability and Flood Recovery” — October 2025 update and dated growth figures.
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