Pakistanis spent two out of every three rupees on just two basic needs – food and electrified shelter – as reliance on foreign remittances and financial aid increased to meet growing expenses, a new government study showed. Expenditures rose at a faster pace than incomes due to current economic pressures and rising cost of living, according to the Household Integrated Economic Survey 2024-25, released by Planning Minister Ahsan Iqbal on Thursday. The results of the survey, conducted after a gap of over six years under pressure from the International Monetary Fund (IMF), have shed light on how inflation has eaten away at people’s hard-earned money, leaving only 2.5% to spend on education. The cost of training was less than half the cost of hotel accommodation. The share of foreign remittances in household income has risen from under 5% to almost 8%, according to the survey. The contribution from gifts and aid has also more than doubled to 4.6%, "indicating greater reliance on informal support networks"says the official report. There has been an exodus of young and talented people from Pakistan due to limited employment opportunities, according to the independent experts. These findings show how difficult it has become for people to make ends meet. There was greater reliance on foreign remittances by rural households, which doubled in six years and indicates lower employment opportunities available to the majority of the country’s population. The greater reliance on foreign remittances and assistance from others reflects the declining domestic sources of income and the impact of double-digit inflation, according to a senior official from the Pakistan Bureau of Statistics (PBS). PBS, which is under the administrative control of the Ministry of Planning, conducted the survey from September 2024 to June 2025. The survey report showed that the average monthly income has increased significantly across households in the past six years. But urban households recorded higher income levels than rural households, rising from Rs 53,000 to Rs 96,767. Total average income rose from Rs41,545 to Rs82,179 in six years, an average of 16.3% per year. But there were also large income differences. In the last financial year, the poorest quintile earned Rs41,851 a month compared to Rs139,317 of the richest 20%. Compared to a 16% increase in monthly income, expenses rose by a fifth during this period, according to the report. The average monthly consumption expenditure increased from Rs37,159 to Rs79,150, an average increase of 19% per year. Expenses
"The data reveals a clear concentration of spending in key categories that reflects current economic pressures, changing spending behavior and evolving household priorities," informed the survey. Compared to the 2019 survey, total household spending increased in the last fiscal year, reflecting rising living costs, changing spending priorities, and improved access to goods and services. The data showed that households spent an average of 63% of their total expenditure on just two functions, food and shelter with electricity and gas facilities. The data further showed that household spending is highest on food, which stands at 37%, followed by 26% spending on housing, electricity and gas, reflecting rising costs of basic food and supplies, according to the survey. Pakistanis have faced several challenges over the past few years which included record high double-digit inflation, unprecedented devaluation of the currency causing imported inflation and harsh conditions of the IMF programs that mostly burdened the middle income groups. The study found that food and shelter costs were higher than in the 2019 era, which also compounded the negative effects of double-digit inflation and the results of the conditions imposed by the IMF, translated into more taxes and more energy prices. Within the food group, expenditure on milk was highest at 22%, followed by 12% on wheat, 9% on wheat and 6% on cooking oil. After spending 63% on just two things, there wasn’t much to spend on developing a healthy mind and body. Total household spending on education, health and recreation remained at just 7% in 2024-25, according to the survey. Lower expenses are recorded for education, only 2.5%, health 3.4% and leisure activities 1.1%, according to the official report. The data further revealed that spending on education has almost halved compared to six years ago, while healthcare spending remained "largely stable". There was also less expenditure on clothing. The survey found that the largest increase was seen in housing, electricity and gas expenditure, followed by 6.6% on restaurants and 6.3% on clothing. Spending on dining at restaurants was more than double spending on education. The higher proportion of spending in restaurants is by higher income groups.
