ISLAMABAD: A new analysis by Gallup Pakistan reveals a stark disconnect between rising nominal wages and the actual quality of life for Pakistani citizens over the last six years.
According to data from the Pakistan Bureau of Statistics (PBS) Household Integrated Economic Survey (HIES) for 2024-25, while average household incomes in rupees have significantly increased, the “real” value of that income has been eroded by persistent inflation. Between 2018-19 and 2024-25, the country witnessed a trend where households are handling more cash but possess less actual buying power than they did in 2019. At the national level, average household income grew by approximately 98% in nominal terms, appearing nearly double. However, when adjusted for inflation to reflect constant prices, the national purchasing power actually decreased by 10%.
The disparity is most visible in urban areas, where incomes rose by 83% but real purchasing power plummeted by 17%. In contrast, rural areas saw the highest nominal income growth at 109%, yet even these households experienced a 5% decline in their real ability to purchase goods and services.
The economic situation appears even more challenging when analysed against the US Dollar to account for currency devaluation. When household income is converted based on actual exchange rates, the data shows that urban incomes decreased by 11% and national-level incomes fell by 3%. Rural areas were the only segment to show a marginal increase of 2% in dollar terms. Ultimately, the report concludes that inflation has effectively wiped out the benefits of income raises for the majority of households, leaving the average Pakistani family, particularly in urban centers, in a worse financial position than they were six years ago.
The study was conducted by the Gilani Research Foundation in collaboration with Gallup Pakistan and is based on PBS data collected from homes across the country between September 2024 and June 2025.
