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Pakistan's Cost-of-Living Crisis: Families Spend 63% on Food and Shelter

Pakistani households are now spending nearly two-thirds of their income on basic necessities like food and utilities, according to a new government survey. This survival spending has forced drastic cuts in education, with households allocating only 2.5% of their budgets to schooling. The crisis has increased dependence on foreign remittances and widened income inequality, as consumption grows faster than incomes. The data paints a stark picture of how inflation and economic pressures are crippling family budgets and long-term development.

Key Points: Pakistan Households Spend 63% on Survival, Survey Shows

  • 63% spent on food & housing
  • Education spending halved to 2.5%
  • Remittance dependence doubles
  • Income inequality widens sharply
2 min read

Pakistan's cost-of-living crisis forces families to spend two-thirds on survival

A new survey reveals Pakistani families spend nearly two-thirds of income on food and housing, slashing education and health budgets amid soaring inflation.

"Households now allocate around 63 per cent of their total spending to just two heads: food and housing-related costs. - The Express Tribune"

Islamabad, January 3

Pakistan's deepening economic crisis is pushing households to the brink, with families now spending nearly two-thirds of their income on necessities such as food and electricity. This leaves little room for education, health or long-term well-being, according to a new government survey reported by The Express Tribune.

According to The Express Tribune, the Household Integrated Economic Survey 2024-25, released this week, paints a stark picture of how inflation and economic mismanagement have reshaped household priorities.

Expenditures are rising faster than incomes due to sustained price pressures, higher utility tariffs and an overall increase in the cost of living.

The survey shows that Pakistani households now allocate around 63 per cent of their total spending to just two heads: food and housing-related costs, including electricity and gas.

Food alone accounts for 37 per cent of household expenditure, while housing and utilities consume another 26 per cent. This growing concentration on survival expenses reflects the crushing impact of double-digit inflation.

One of the most alarming findings is the sharp decline in spending on education. Households now spend only 2.5 per cent of their budgets on education, less than half of what they spend on housing and utilities.

Combined spending on education, health and recreation remains stuck at just 7 per cent, raising serious concerns about human development.

The survey also highlights a growing dependence on foreign remittances and informal assistance. The share of remittances in household income has risen to nearly 8 per cent, up from less than 5 per cent six years ago, while gifts and external assistance have more than doubled.

Rural households, facing fewer employment opportunities, rely even more heavily on remittances, a trend experts describe as a symptom of a shrinking domestic economy, as cited by The Express Tribune.

Although average monthly incomes have increased over the past six years, rising from about PKR 41,500 to over PKR 82,000, spending has grown at an even faster pace.

Consumption expenditures have surged by roughly 19 per cent per year, outpacing income growth and eroding purchasing power. Income inequality has also widened sharply, with the richest 20 per cent earning more than three times what the poorest quintile makes, The Express Tribune reported.

- ANI

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Reader Comments

P
Priya S
The reliance on remittances doubling is a clear red flag. It shows the local economy isn't creating enough jobs. When people have to leave their country to support their families back home, it's a sign of deep structural problems. Very sad for the common people caught in this.
A
Aman W
While the situation is undoubtedly tough, we must also acknowledge that economic mismanagement has consequences. The article itself cites it as a cause. The common citizen always suffers the most in these crises. My prayers are with the families just trying to get by. 🙏
S
Sarah B
The income inequality stat is shocking – the richest 20% earning 3x more than the poorest. This kind of disparity, combined with runaway inflation, is a recipe for social unrest. It's a grim reminder for all economies, including India's, to focus on inclusive growth.
K
Karthik V
Food taking up 37% of the budget is unsustainable. It reminds me of stories from my grandparents about tough times. When survival becomes the only goal, development takes a backseat. This will have a long-term impact on their human capital. A sobering read.

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