ISLAMABAD, Nov 25 (Wealth Pakistan): Pakistan’s non-agricultural workforce remains predominantly informal, with 72.1 percent of employed persons classified as informal sector workers in 2024-25, according to findings of the latest Labour Force Survey.
Overview of informal sector employment
The Pakistan Bureau of Statistics has released the 37th round of the Labour Force Survey, which documents trends in formal and informal employment across provinces, gender groups and occupational categories. According to the Labour Force Survey 2024-25 document available with Wealth Pakistan, more than seven in ten non-agricultural workers remain outside the formal sector.
The survey defines informal sector employment as work performed in unregistered or unregulated enterprises. The formal sector includes workers and businesses registered under relevant laws. The 13th International Conference of Labour Statisticians definition is used for non-agricultural employment, while the 19th ICLS definition applies to overall employment.
National and gender-based trends
Under the 13th ICLS definition, informal employment accounts for 72.1 percent of non-agriculture employment in 2024-25, compared with 72.5 percent in 2020-21. This reflects a slight decline in informal employment and a marginal increase in formal sector participation, which rose from 27.5 percent to 27.9 percent.
The survey highlights gender-related differences in formal and informal employment. Female participation in the formal sector is higher than male participation. In 2024-25, 33.7 percent of female non-agricultural workers were in the formal sector, compared to 27.0 percent of male workers. Male workers dominate the informal sector, where 73.0 percent of non-agricultural workers are employed, compared to 66.3 percent of females.
Urban–rural differences
The informal sector share is higher in rural Pakistan. Informal employment accounts for 75.5 percent of non-agricultural workers in rural areas, while in urban areas it stands at 68.3 percent. In contrast, formal sector employment stands at 24.5 percent in rural areas and 31.7 percent in urban localities.
The survey also highlights provincial variations. Punjab and Sindh show higher formal sector shares, driven by their large urban economies, while Khyber Pakhtunkhwa and Balochistan report higher informal employment levels.
Informal sector by industry and occupation
The survey provides detailed distributions across industry divisions. Wholesale and retail trade, construction, transport and small-scale manufacturing account for a large share of informal jobs.
Most informal workers fall under elementary occupations, craft and related trades, machine operation and service activities. Informal sector employment is prominent among own-account workers and contributing family workers. These groups include individuals running small, unregistered businesses or assisting family enterprises without formal contracts.
The survey also presents educational profiles of informal workers. They are represented across all education levels, including individuals with no schooling and those with primary or middle education.
Formal sector characteristics
The report documents features of formal employment as well. Workers in the formal sector are concentrated in manufacturing, education, health, public administration and corporate services. These workers are more likely to have written contracts, registered employment and access to employment benefits.
The occupational structure of formal employees includes professional, technical, managerial, clerical and service roles. These employees are largely concentrated in urban areas.
Survey design and data coverage
The Labour Force Survey uses a stratified two-stage sample design. In total, 53,974 households were interviewed across 3,796 sample blocks, covering all four provinces and Islamabad. Fieldwork was conducted quarterly from July 2024 to June 2025.
The survey uses 2023 census population estimates, adjusted with an annual growth rate of 2.075 percent. Employment indicators are reported under both the 13th and 19th ICLS frameworks to enable comparability with the 2020-21 survey.
Key conclusion
Under the 19th ICLS definition, which includes both agricultural and non-agricultural sectors, the informal employment share rises to 80.8 percent of total employment. The survey findings indicate that Pakistan’s labour market remains heavily informal, with only 19.2 percent of the workforce engaged in the formal sector.