Active Labour Market Intervention and Unemployment

Unemployment is increasing with the increase in population day by day, especially in developing countries. According to the Economic Survey of Pakistan (2020-21), the 4.51 million people are unemployed in Pakistan. Active Labour Market Interventions (ALMIs) are an important tool for enhancing labor market integration. Their economic rationale is to increase the supply of skilled labor, reduce skill mismatches, foster labor demand for labor-intensive public employment programs, entrepreneurship, self-employment measures, or modify the structure of demand through employment subsidies (Auer et al., 2008). Their social rationale is to reduce Social Exclusion. In other words, effective Active Labour Market Policies & Interventions increase growth and competitiveness on the one hand and enhance inclusiveness on the other hand.

However, ALMIs require a thorough differentiation between other labor market and social protection policies such as cash transfers, and insurance (Kluve et al., 2017). These interventions are key to achieving inclusive growth; a growth that creates employment and reduces inequality. ALMIs help people find jobs, promotes directly or indirectly productive jobs, and improve the quality of skills and productivity of people which leads to growth in the economy (ILO, 2016). The international experience suggests that the ALMIs are particularly important for the countries that have a youth bulge but lower rates of labor force participation.

The SPRC aims to introduce sustainable interventions for protection against unemployment, and provide support to the government in Active Labour Market Interventions. The SPRC also aligns its work on environment with its vision for labour through research on opportunities for creating Green Jobs.