Ahead of the Federal Budget 2026–27, the Pakistan Institute of Development Economics (PIDE) has proposed a major increase in the country’s minimum monthly wage, recommending that it be raised from Rs. 40,000 to Rs. 45,000.
The institute has also called for a transparent and scientific wage-setting mechanism linked to inflation, poverty levels, and purchasing power, while stressing stronger enforcement and monitoring of minimum wage laws across the country.
According to the recommendations, the proposed minimum monthly wage should be set at Rs. 46,000 in Sindh, Rs. 45,000 in Punjab and Khyber Pakhtunkhwa, and Rs. 45,500 in Balochistan.
PIDE has also recommended the phased implementation of the minimum wage and stated that compliance with minimum wage requirements should be made mandatory in government contracts and outsourced services.
According to the institute, more than 80% of employment in Pakistan is in the informal sector, making enforcement of minimum wage laws a major challenge.
PIDE further proposed that all provinces publish annual reports on minimum wage implementation to enable effective monitoring and evaluation of the system.
The report says that the proposed framework has been sent to the Planning Commission of Pakistan for consideration.
PIDE underscored that the minimum wage system should not be limited to an annual announcement; rather, it should be linked to an effective framework of governance, monitoring, and enforcement.
