Islamabad: A 20-year comparison of household consumption patterns in Pakistan reveals a profound shift in how families allocate their budgets, with spending steadily moving away from food and toward housing and utilities.
New analysis from Gallup Pakistan, based on data from the Household Integrated Economic Survey (HIES), shows that rising fixed living costs-particularly electricity and gas-have emerged as the dominant pressure on household welfare.
Between 2005 and 2025, the share of household spending devoted to food declined from 43% to 37%. This drop does not signal improved food affordability. Instead, when viewed alongside stagnant real incomes and evidence of reduced food quantities, it likely reflects households cutting back on consumption to cope with rising fixed expenses-raising concerns about nutrition, especially for women and children.
Over the same period, spending on housing and utilities rose sharply from 15% to 25% of household budgets-the largest increase across all consumption categories. These costs are driven largely by electricity and gas tariffs, rents, and administered prices that are increasingly shaped by policy decisions rather than household choice.
Transport spending increased modestly from 5% to 7%, while communication rose from 1% to 2%, reflecting fuel costs and the growing necessity of connectivity. In contrast, education (3%), health (3%), and recreation (1%) remained broadly flat, suggesting that rising fixed costs are crowding out spending on human capital and quality of life rather than expanding it.
The reallocation of household budgets highlights a structural squeeze: as electricity, gas, and housing costs absorb a larger share of income, families adjust not by increasing total spending, but by cutting back elsewhere-often on food and other flexible essentials. This pattern points to hidden welfare losses that may not be fully captured by headline inflation figures.
Household consumption patterns offer a window into lived economic stress. The growing dominance of housing and utility costs suggests that cost-of-living pressures in Pakistan are increasingly driven by fixed, policy-sensitive expenses. Without careful calibration of energy pricing, taxation, and social protection, these pressures risk undermining nutrition, human capital, and long-term welfare.
Pakistanis are not spending less on food because life is cheaper-they are doing so because housing and utilities now claim a far larger share of household budgets. The data point to a cost-of-living challenge rooted in fixed expenses, with important implications for welfare, nutrition, and economic policy.
Gilani Research Foundation is a not-for-profit public service project to provide social science research to students, academia, policymakers, and concerned citizens in Pakistan and across the globe.
Gilani Research Foundation is headed by Dr. Ijaz Shafi Gilani who pioneered the field of opinion polling in Pakistan and established Gallup Pakistan in 1980. Currently, Dr. Gilani, who holds a Ph.D. from the Massachusetts Institute of Technology (MIT) and has taught at leading universities in Pakistan and abroad, is Chairman of Gallup Pakistan.
Disclaimer: Gallup Pakistan is not related to Gallup Inc. headquartered in Washington D.C. USA. We require that our surveys be credited fully as Gallup Pakistan (not Gallup or Gallup Poll). We disclaim any responsibility for surveys pertaining to Pakistani public opinion except those carried out by Gallup Pakistan, the Pakistani affiliate of Gallup International Association.