World Bank report highlights decline in jobs despite PNG’s strong economy

A recent World Bank report indicates that PNG's economy is growing but not enough jobs created *(Image: Roan Paul)*

Papua New Guinea's economy is growing strongly but is not yet creating enough quality jobs for its fast-growing population, according to a new World Bank Economic Update report.

The latest Papua New Guinea economic update, titled Turning Growth into Jobs, finds PNG's economy expanded by 5.6% in 2025, one of the strongest performances in the Pacific.

This was supported by Strong Gold and LNG production, alongside Exchange Rate Reforms which improve the business environment beyond the resource sector.

However, the report finds that formal employment per capita has declined, with newest workers entering subsistence farming and informal work rather than secure formal jobs.

According to World Bank Division Director for PNG, Solomon Islands and Vanuatu, Han Fraeters, PNG is at a critical moment.

The economy is growing and the resource sector has major opportunities ahead. There is now a small window of opportunity to turn this momentum into better jobs and livelihoods for all Papua New Guineans.

All evidence points in the same direction. PNG can make its resource world work better for its people. That means securing fair returns, investing more in human capital and infrastructure, and improving the conditions for private sector growth.

He said the economic update sets out three-part jobs agenda, strengthening foundation for growth through improved infrastructure and human capital, enhancing the business environment and economic governance so firms can invest and hire, and mobilizing more private capital while ensuring resource revenues are used more effectively to support sectors that can create jobs at scale.

Meanwhile, the report identifies agribusiness as one of PNG's most promising pathways for creating jobs at scale, strengthening key agricultural value chains, could generate around 330,000 additional formal jobs over the next decade, and reduce poverty by around five percent, lifting an estimated half a million Papua New Guineans out of poverty.

However, the report highlights inadequate infrastructure and weak human capital as key constraints to productivity, growth, and job creation.

Better roads, electricity, and digital connectivity are also needed to support investment beyond Port Moresby and Ley, while stronger investment in nutrition, education, and skills will be critical to prepare PNG's young population for more productive work.

The World Bank suggests this growth jobs disconnect is one of PNG's central development challenges.