The Palestinian Economy. Theoretical and Practical Challenges

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Proceedings “The Palestinian Economy: Theoretical and Practical Challenges” 397 2. Palestinian labour force indicators Considerable differences exist in the distribution of labour force in the Palestinian Territory based on socio-economic factors. The average labour force participation rate (LFPR) was 41.6% during the second quarter of 2008. The LFPR rose from 39% at the end of 1995 to a maximum of approximately 43.5% by September 2000. The rise in LFPR demonstrated improved confidence in obtaining work in the formal labour market i.e., work opportunities in the Palestinian labour market generally improved during the certain periods. Female LFPR is extremely low, though it increased significantly, from its 1993 levels (6% in the West Bank and 2% in Gaza) up to 16% in the second quarter of 2008 compared to 66.3% among men. The factors attributed to the low female LFPR are numerous. The weakness of domestic employment growth compared to labour force growth is one explanation. Shaban argued that the fall in female participation rates is attributed to the lack of appropriate, particularly public, employment which has limited women’s chances of participating more actively in the labour force (Shaban 1993). Others have argued that employed women are unreported since many works in the informal sector or conceal their involvement in the labour force (Long and Mohanna 1990). The nature of data collection also leads to low reporting by women on their participation in the labour market (Al-Qudsi and Shaban 1996). The total number of employed individuals is 666 thousands in 2007 of 2006, of whom 84% are male employees. The private sector is the main employer counting for about 61.3% of employees, followed by the public sector (22.7%), then 10.8% working in Israel and the remaining working in NGOs and other sectors. Wage employees are about 60.4% of employees followed by 22.9% as self employed and the remaining are employers and unpaid family members during the second quarter of 2008. The share of self employed increased since the third quarter 2000 (18%) as a result of rising unemployment which forced some people to start their own businesses. The Palestinian economy is characterised by its low absorptive capacity resulting in a chronic unemployment problem. The unemployment rate in the Palestinian Territories dropped significantly up to 11% at the end of the third quarter of 2000 but it jumped significantly to reach 25.8% at the of the second quarter of 2008. The decline in unemployment was justified by three factors: the formation of the Palestinian National Authority which absorbed about 150 thousand employees at the end of the second quarter of 2008, and the real economic growth which reached around 9% until 1999, and the
398 Makhool labour exports to Israel which reached 145 thousand during the third quarter of 2000. The sharp increase of unemployment after 2000 was due mainly to the Israeli repressive measures aimed at quelling the Intifada. Unemployment rate fluctuates sharply depending on the severity of the Israel repressive measures and the political and economic stability in the West Bank and Gaza (see Figure 1). Figure 1: Unemployment Rate in the West Bank and Gaza* % 40 35 30 25 20 15 10 5 0 1972 1975 1978 1981 1984 1987 1990 1993 1996 1999 2002 2005 West Bank Gaza Strip * Data on 2008 covers only the first six months of the year. Source: Based on PCBS and Israeli Statistical Abstract. Since 1995, unemployment in the Gaza Strip was higher than in the West Bank. The rate was 16.3% in the West bank and 45.5% in Gaza during the second quarter of 2008. This could be explained on the ground that severity of the Israeli siege on the Gaza Strip is greater. In addition, the economic base in the Gaza Strip is less developed and weaker in terms of employment absorption compared to that of the West Bank. The burden of unemployment widely varies with social-economic indicators. Unemployment rate declines with education. The lowest unemployment rate was among graduates (who finished 13 years of schooling or more) 24.5% of whom were jobless, and the highest was among those who finished less than 7 years of schooling: 28.9% during the second quarter of 2008. Similarly, unemployment declines with age. The highest rate of unemployment was among the 15-19 years age group, which registered 37.4%, and declines to 14.2% for those aged 50 years or more. Geographically, in the West Bank
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The Palestinian Economy Theoretical
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© Gianni Vaggi - Marco Missaglia -
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VOLUME II
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246 Zagha 1. Introduction The local
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248 Zagha and groups in political d
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250 Zagha drawbacks in the politica
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252 Zagha it is not surprising that
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254 Zagha economy (including expend
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256 Zagha social norms sharply dist
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258 Zagha Bird (1995) puts it, info
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260 Zagha intergovernmental fiscal
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262 Zagha low rate flat tax levied
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264 Zagha need to be given access t
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266 Zagha Such failures are found i
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268 Zagha 4.1.3. The Relationship b
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270 Zagha a final account report of
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272 Zagha 4.1.6. Functions of LGUs
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274 Zagha • Management of LGU ass
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276 Zagha Figure 2: Local Governmen
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278 Zagha In summary, what the data
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280 Zagha on the cash basis. Almost
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282 Zagha Figure 7: Business Opinio
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284 Zagha within the Palestinian na
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286 Zagha Table 5: Number of NGOs i
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288 Zagha Fiscal decentralisation i
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290 Zagha Burki, J., Perry, G., Dil
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292 Zagha Palestinian Legislative C
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Issues, Performance and Trajectorie
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The Effect of the Israeli-Palestini
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Assessing the Causes of Inequality
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