Islamabad, 5 May, 2025: Utility Stores Employees in Pakistan are set to face widespread layoffs as the government moves forward with public sector reforms under the supervision of the International Monetary Fund (IMF), sources confirmed on Monday.
In line with a broader cost-cutting strategy agreed with the IMF, the federal government has been instructed to reduce staffing levels at the Utility Stores Corporation (USC) by June 30, a step being implemented in phases.
According to official sources, over 2,200 temporary workers have already been laid off in the first round of dismissals.
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The second phase is expected to affect approximately 2,800 contractual Utility Stores employees in grades 1 to 13, who will also lose their jobs.
Staff employed in grades 14 and above will reportedly be moved into a surplus pool, pending future redeployment or reassignment within the public sector.
Closure of Non-Profitable Stores Also Planned
In addition to workforce downsizing, the government has decided to shut down about 1,000 loss-making Utility Stores by the end of the current financial year.
This move will significantly shrink the operational footprint of the USC, cutting the total number of stores from 5,500 to 1,500 nationwide. Daily-wage employees at these closed outlets will also be let go.
Remaining stores that remain viable are expected to be privatised, as stated in official documents. The shift toward privatisation and streamlining is part of the IMF’s long-standing push for reduced public spending and improved financial governance.
Funding Constraints and IMF Deadline
Last fiscal year, the Utility Stores Corporation received a subsidy package of Rs38 billion. However, this year’s approved allocation of Rs60 billion has yet to be released by the government, raising concerns about the sustainability of the remaining operations.
The timing of these reforms is linked to the IMF’s upcoming Executive Board meeting, which is scheduled for May 9.
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Pakistan is on the formal agenda, and the Board is anticipated to approve a $1.1 billion disbursement under the country’s extended loan programme.
In addition to discussing the financial review, the IMF will consider changes to performance targets and evaluate Pakistan’s request for further support through the Resilience and Sustainability Facility.
The restructuring of Utility Stores marks a pivotal shift in public sector policy, with Utility Stores Employees among the most directly affected by these austerity-driven measures.
