Pulse and Indicators of Unemployment in Palestine — Part Four

9-10-2018                  

· Part Four From the article.. Unemployment

- As for the local—internal—factors that led to the increase in the unemployment rate with this severity, local causes emerge in our Palestinian society that affect government bodies and civil society alike, adding other predicaments on the Palestinian side, which we summarize as follows:

-        The tragedy of the Palestinian division... which has been ongoing for eleven years.. and we have observed that the unemployment rate in Gaza is much higher than in the West Bank, and it is assumed, had there been unity between the two parts of the homeland - as they are called - that all resources would have been employed and the country’s economy developed so that all obstacles to economic advancement would be addressed more appropriately and efficiently and in a complementary manner. This division has a pivotal role in our economic shortcomings, not to mention the devastation on political and moral levels as confidence within Palestinian society in the return of harmony among Palestinians has vanished... and the focusing of efforts on ending the Israeli occupation through unified collective defense of the homeland.. and establishing the Palestinian state.. with its capital Jerusalem..

-        Tax evasion... by some Palestinians, which will reduce potential revenues from new taxpayers to the Palestinian National Authority’s treasury, despite the improvement in tax revenues in 2017, and that clearance revenues have also improved.. slightly.... Tax revenues are one of the important factors in supplying the treasury with financial resources to increase public spending that is used to improve economic growth by increasing investment and improving the investment environment in the country... however there are estimates of large numbers of workers in all professions in the market who are not registered in the tax records according to regulations. This is a negative culture that harms the citizen before anyone else... The tax system may need appropriate development, amendment and reform in order to mobilize efforts and resources to develop society and raise living standards.. and to create incentive measures for many sectors of the economy..

-        The existence of touches of monopoly in some projects and investments that are not in the hands of the private sector.. which is subject to market economics and the competitiveness of its tools.. The private sector is more capable of creating new jobs given its essential role in the Palestinian economy and it should be granted full freedom to operate.. and laws should be enacted to regulate market transactions.. and not to interfere in the conduct of private sector business.. except within the limits of protecting the public interests of Palestinian society..

-        Obstacles to encouraging investment: there still exist obstacles and bureaucratic routines to promoting investment whether in the lack of flexibility of incentive packages for investment with transparency and credibility, or obstacles practiced by some connected individuals for personal interests.. which deters investors at home and abroad, especially the expatriate sector.. from undertaking projects.

-        The underutilization of the role of Palestinian expatriates in the diaspora, because it is vital and necessary, where these expatriates can help by investing in the country, not to mention providing Palestinian society with creative and experiential opinions and expertise on investment matters and they are people with capital and experience in open societies. What is required is continuing engagement and activation with expatriates, and enacting strict and flexible laws to protect expatriate investments if they come.. who also have a major role in creating new job opportunities.

-        Low wages, since the minimum wage is still low and amounts to 1,450 shekels.. and this amount in light of rising living expenses in Palestine.. is not sufficient to cover expenses.. or to establish families.. In addition, there are sectors in the Palestinian national economy that have not received their fair share of government spending and investment by the private sector.. Moreover, development operations have been limited to urban areas, and in some governorates. This led to migration from the countryside to the city, especially in some governorates such as Ramallah and al-Bireh Governorate.. where more than 50% of banking facilities are concentrated for banks. In addition, rural areas are classified as “C” according to the Oslo Agreement 1993, which the Palestinian National Authority cannot exploit or invest in, and in this regard, the Palestinian Authority is making efforts with Europeans to lift this ban by the Israeli occupation and to allow Palestinians to exploit and invest in “C” areas.

-        The high cost of prices whether of goods or land or services, such as transportation and rents, etc.... In addition to the rise in shop vacancy prices.. which reach unprecedented figures even in neighboring countries.. and land prices are high. All these matters do not encourage a new businessman in the market to begin his investment, as his liquidity will be consumed to pay vacancy or rent... before he tries to build his merchandise in the shop..... In addition, profit margins on sales are considered usurious..., as profit rates on some goods reach well over 100%.. and the credibility of some businessmen is weak... as some acts of fraud and deceit and lying have been observed... without there being a deterrent punishment that reassures the investor..

-        The phenomenon of bounced and returned checks, notably, with annual increases, despite the Palestine Monetary Authority’s continuous efforts to combat this phenomenon, which prevents increased investment and rather causes it losses, because checks represent the rights of the private sector.. which anticipates growth in its business.. The unprecedented rate of check returns compels merchants to reconsider the continuity of their businesses, given the huge losses from non-payment of debts due to them in the form of checks, and unless this problem is solved in cooperation with the Palestine Monetary Authority and the banks and the judiciary which must make its mark by speeding up adjudication of commercial cases and activating and expanding commercial courts... the private sector and capital owners will find another way to invest their funds by emigrating to other locations abroad that are more suitable and more profitable... and the greatest loser will be society and job opportunities that were potential ...

-        The absence of training centers for university graduates.. to help them enter work, which requires, to occupy positions, periods of practical experience.. for candidacy to the labor market.. But unemployed graduates may seek work with companies or institutions or individuals even under the name of training to gain experience.. and without pay.. and it may continue for a year or more.. so that it appears that he has secured a position at that place to work.. In most cases.. this unpaid trainee who spent a year to obtain practical service is dismissed from work due to the absence of a suitable vacancy commensurate with this graduate’s qualifications.. etc.. Or this graduate or several of them may serve in workplaces where it is considered pity by employers.. where they accept for themselves a salary not exceeding one thousand shekels or less.. and does not reach the minimum wage of 1,450 shekels... per month.. and these amounts will not create for the young man a family for stability nor for the young woman either, given the payment of transportation and personal expenses that leave no room for savings... and thus in the sense of the definition of unemployment which we will come to later.. he is unemployed... And there are some practices by employers that do not serve the homeland nor the young graduates given the responsibility of business owners for a proportion of their profits as social responsibility.. Despite the existence of some nonprofit institutions or organizations that serve graduates by attempting to train them for several months up to 6 months.. to acquire experience and agreements are made with business owners and other institutions to attach some of these graduates to these workplaces.. to train them.. and agreement is usually made between these institutions that serve graduates.. and employers’ institutions to pay a monthly salary for six months half of the monthly salary amounting to 300 dollars paid by this institution.. and the other half of the monthly salary amounting, as we mentioned, to 300 dollars is paid by the employers, and agreements are made in this regard. Although sometimes there is lack of transparency from business-sector institutions, as they do not actually pay their share of the salary amounting to 300 dollars, but rather have the trainee sign that he received the salary formally... and this is considered lack of credibility by such institutions, and the trainee is forced to keep silent and not inform the sponsoring institutions for such programs... It is possible to allow the attachment of two or more of these trainees.. to business institutions.. via such institutions that serve graduates to train them so that they gain experience.. and benefit from it either by being made permanent at the institutions where they train or to obtain job offers.. with a salary as pocket money and as compensation for the graduate’s monthly expenses..,

-         The increase in the population growth rate as we mentioned previously.. and this increases the burden on the Palestinian National Authority to secure the finding of job opportunities with the population increase, a matter that the Authority finds difficult in light of the obstacles and restrictions that limit its capacity and capabilities..

-        There are some employees working in ministries, departments and the private sector who carry out another job alongside their work, and this harms efforts made to solve the unemployment problem, as they cut off the way and take the seats of some other candidates who are waiting their turn to work... and therefore dual employment must be prevented for employees, and not permitted but rather punished the "المظف" who works more than one job..

-        Administrative corruption in some governmental workplaces in terms of hiring procedures and the existence of favoritism, wasta and patronage.

-        The absence of effective trade unions that can participate substantially in helping to solve unemployment... in addition to the absence of government unemployment assistance institutions, similar to some other countries.
- The absence of a Legislative Council and legal and parliamentary bodies to follow up on community problems and to monitor the performance of the executive authority, since the existing oversight bodies at present do not reach the level of legislative and parliamentary councils that in reality represent the authority of the people who should rule by democratic concepts... in order to protect Palestinian society from any practices that might depart from democratic standards and methods... and from monopolizing decisions and wasting the people’s money.

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-        Skills atrophy among human resources when the job search period extends for years, noting that some countries classify a person as unemployed after one or two weeks and at most a month of failing to obtain a job. They are enrolled in unemployment assistance programs until a vacant position suitable for them is found. As for us, I believe the period extends for years and the wait is long... in addition, governmental bodies do not communicate with their unemployed citizens, whereas it is necessary to pay attention to them and assist them by appropriate means so that they feel that society and the government care about them... in order to preserve the cohesion of the social fabric.

-        Restricting the employment of external aid to implementing service, environmental, social and humanitarian projects. Projects should be productive and provide employment for small enterprises and their programs, and the principle of transparency in financial data, auditing and oversight of the flow and purposes of spending of these aids should be entrenched in a real way..
- Emergency and temporary employment programs, as in the general statistics and elections, are not considered a solution to the unemployment problem, as they lack continuity and stability..

-        Lack of familiarity with the skill requirements demanded by the labor market in the context of technology, globalization and the nature of electronic jobs, since it is now possible for a person to work from home with institutions abroad without crossing borders. Therefore, preparations must be made for such concepts and they must be introduced into the planning programs of universities, the concerned ministries and civil society bodies.z.
- Structural adjustment measures, where at times advice is given to any country to restructure the economy and as a consequence privatize and reduce public sector jobs and cut basic subsidies for essential goods in society... at the behest and requests of the IMF and international banks... and consequently this results in reducing jobs in the public sector and some other sectors and raising prices and increasing poverty and unemployment rates... which must be treated with caution, unless alternative resources are secured to address unemployment in society.

-        Stagnation of the concept of corporate social responsibility in the private sector, since it must play a tangible role in helping to solve the unemployment problem, and not be limited to charitable and social assistance in their application of this concept of responsibility.

-        Failure to create job opportunities abroad for graduates... markets for graduates must be sought in Arab markets, and it is necessary to make agreements to absorb categories of Palestinian graduates and to organize such activity after subjecting them to training workshops that qualify them to enter the labor market directly.

-        The issue of university education: a large proportion of the unemployed are university graduates... and among the reasons for this unemployment is the mismatch of university educational policies in Palestine with employment policies in the Palestinian market. It has been noted that the unemployment rate among Palestinian university graduates is high due to the Palestinian labor market’s inability to absorb these numbers of graduates... in addition to the lack of alignment in planning the majors taught in Palestinian universities with what the Palestinian market demands in terms of skills and specialties. Some research statistics published in Palestine indicated that only 16% of university graduates go directly to the labor market after graduation.
- There is an opinion that education causes unemployment... since the highest unemployment rate is among university graduates in Palestine, reaching 40%, which creates a danger and shakes the necessity and inevitability of education in light of the increasing unemployment rate among university graduates. The situation of these graduates will not incentivize others to continue seeking knowledge if it is known in advance that there are no vacant jobs for all or even for a reasonable portion of graduates. Graduates face limited choices: either to fend for themselves and work in Israel and the settlements, in light of the lack of university qualification requirements for work in Israel for example, where Palestinian workers receive higher wages than their counterparts in the West Bank if they can obtain work permits, which are set in numbers by the occupation authorities, or to work in Israel by smuggling themselves through contractors employed for that work. If some succeed in the humiliating manner of jumping high walls or barbed wire early in the morning, part of their income goes to that intermediary contractor for the manual labor, in addition to those workers—under the label of illegal—being denied benefits such as health insurance, vacations, holidays and end-of-service pay. All that they will lose after they put their university degrees with their mothers or wives to prove that education does not put bread on the table!!.. or search the Palestinian market for a long time for vacant jobs that are limited and do not match the submitted applications. We notice that when one vacancy is announced, the applications submitted number in the thousands...

-        The number of university graduates reached about 40–45 thousand graduates annually, and the number of available job opportunities annually reached 8,000 job opportunities at most.... and therefore, a gap accumulates annually, increasing the burden year by year, which warns of the emergence of a chronic unemployment crisis..

-        The educational system, especially the university system, does not fully plan curricula in a way that aligns with the requirements of the labor market, according to the statistics indicating that there are majors at universities here in Palestine that have flooded the market with graduates and the result is the absence of any jobs for this category of majors... such as general sciences and general social sciences in numbers that do not match what is required in the labor market in terms of demands and skills.

-        Failure to seriously introduce new concepts about the required skills into the labor market, especially technological ones, in light of changing concepts of work schedules in the labor market in the world of modern knowledge and the revolution of technology and information, which casts its shadow on the economy and labor. It is expected in the coming years that machines will be used gradually instead of human labor, thus laying off and closing existing jobs due to the human element not being adapted to modern skill and training requirements and cost considerations. Therefore, competence and qualification providers must interact more in planning in partnership with the concerned ministries, the private sector and even families, who in some customs restrict their children’s majors in universities.