It is very rare for a non-statistical organisation in Pakistan to undertake some kind of survey on the general thinking of ordinary households on certain aspects of the evolving economic situation. It was, therefore, a pleasant surprise to see that ROZEE.PK, a job portal and YouGov, an international research company, had joined hands to conduct an online survey involving 6,431 working respondents to know their perception/experiences about inflation, salary increases, savings, etc, in the recent past.
As expected, the results of the exercise revealed that majority of working Pakistanis believed that their cost of living had increased more than their salaries over the last one year. Three quarters of the respondents claimed that their cost of living had increased by more than 15 percent in the past one year, while they received pay increases lower than that. Interestingly, 74 percent said that they deserved to get a salary increase of 16 percent or more, while 37 percent expected to get a salary increase of more than 15 percent in the next 12 months. Twenty-four percent of the respondents had not received any salary increase during the past 12 months. However, despite these findings, respondents were almost evenly split in terms of how satisfied they were with their raise this year. Thirty percent were happy with their salary increase while 34 percent were unhappy with their raise. Also, only 11 percent of the respondents felt that the quality of their lives was worse than before.
The picture was particularly bleak, insofar as household savings were concerned. Almost half of those polled do not save anything from their income and a third saved less than 10 percent of their household incomes in the previous year. The survey also revealed that older respondents (aged 40 years or more) were more likely to save than the younger workers, but they were saving a lower proportion of salary than other savers. It was also found that males on average earned an extra Rs 4,000 per month than female workers.
The survey conducted through the collaboration of ROZEE.PK and YouGov, though not widely reported, tries to explore certain facts about the quality of life of ordinary workers in Pakistan and is interesting for a number of reasons. Contrary to the general perception of large-scale despondency and disgruntlement prevailing in the working class, the survey has found almost one half of the working Pakistanis satisfied with their existing situation though their net disposable income in constant terms (income adjusted for salary increases and inflation) or the purchasing power of their salaries must have declined during the past year. Also, their level of satisfaction was not undermined by the hefty increase of 50 percent in salaries granted to the government employees last year and they were not unduly perturbed over this discrimination. There could be two reasons for overall lack of frustration and the belief among the majority of workers that their quality of life was not worse than before. Either they are religiously inclined and are content with whatever they are getting or must feel satisfied that they have at least a livelihood in a country where a significant number of other employable persons are unemployed. In any case, such an attitude, en masse, explains the reason why the workers are not agitating against their employers, however on a modest scale, to compensate them fully for their dwindling purchasing power due to inflationary pressures in the economy. In certain circles, it may also be interpreted to mean that the government does not have to worry too much about the impact of inflation on social stability in the country and the change in the attitude of the ordinary workers.
A very disappointing finding of the survey was the inability of the households to save a significant amount from their salaries. An overwhelming proportion of the workers either do not have the capacity to save or save only a negligible amount of their incomes. No wonder then that most of the workers want to stick to their present jobs at all costs to meet their monthly expenditures and find themselves in a soup when they are without work, even for a short period of time. The absence of social safety nets makes their plight even more miserable. The impact on the overall economy of such a negative finding is even more disturbing.
Pakistan needs to gear up its saving rate to meet its growing investment requirements and revive growth, but domestic savings as a percentage of GDP have declined from as high as 17.6 in 2002-03 to only 9.5 in 2010-11. Since the government sector is a non-saver, household savings have to be increased to respectable levels to fill the fiscal gap and allow a larger proportion of the country's overall debt to be financed internally as well as to meet domestic investment requirements. The survey has clearly shown that such an objective is impossible to achieve when the rate of increase in the cost of living is higher than the salaries of workers. Such a conclusion was of course intuitive, but we are happy that some organisation has taken the trouble to prove it statistically.