An overview of employment in Papua New Guinea, including formal/informal sector employment, employment figures by industry, regional factors, and relevant organisations.

Credit: R D Tuna Canners

The vast majority of Papua New Guineans are employed in the informal sector, mainly in subsistence agriculture. Participation in the formal sector is estimated at only about 15 per cent of PNG’s total workforce.

Informal sector employment is particularly widespread in the youth population (approximately 40 per cent of Papua New Guineans are under the age of 15). Young people are under-represented in the formal sector. According to the World Bank, those aged between 15 and 24 account for only two per cent of formal sector employment (and only 1.5 per cent in rural areas). Twice as many men as women are employed in the formal sector.

Employment in the non-resource sector has declined by 10 per cent since 2012, largely because the PNG LNG construction project concluded in 2013. Employment in the resource sector has increased, but resource sector employment makes up only about 10 per cent of total formal sector employment. Creating more employment in non-resource industries remains a challenge.

Employment growth by sector, from 2012 to 2019

Source: Bank of PNG

Between 2012 and 2019 employment only increased in the Highlands region. It fell by 14 per cent in the National Capital District.

The informal sector employs the majority of the working-age population, mostly low-productivity subsistence agriculture.

PNG’s National Minimum Wage is set by the Minimum Wages Board and is currently K3.50, as of 1 July 2016.

According to the World Bank, children born in Papua New Guinea will be only 38 per cent as productive when they grow up as they would have been if they enjoyed a complete education and full health. Papua New Guinea’s Human Capital Index of 0.38 is below the regional average for East Asia and the Pacific (0.61).

While progress has been made developing skilled workers, especially in the resources and ICT sectors, the majority of PNG’s labour force is low-skilled, with the majority of the population not educated beyond Grade 10. Standards in post-secondary education are also poor, with a critical shortage of skills.

Relevant organisations

• Department of Labour and Industrial Relations (www.workpermits.gov.pg)
• The Employers Federation of Papua New Guinea (www.efpng.org.pg)
• Papua New Guinea Trade Union Congress (www.facebook.com/PNGTUC)