The employment of Palestinians, including refugees, is one of the
main problems that must be solved if the stability of the region is
to be ensured. This is particularly the case in the context of the
current negotiations, bearing in mind the lack of a labor
infrastructure in the West Bank and Gaza.
The only viable solution is the creation of such an infrastructure
in these territories, because employment trends and political
conditions in Israel and the Arab countries indicate that
Palestinian workers will be increasingly replaced by workers from
other Arab countries, cheap Asian labor, or (in the case of Israel)
by new immigrants.
The Gulf States
Both past migration patterns among Palestinians, and current
political and economic conditions, point to the conclusion that the
work force in the West Bank and Gaza cannot expect either the Gulf
states or Jordan to solve their employment problems. The reasons
for Palestinian migration have never been purely economic. Both the
1948 and the 1967 wars were causes of large-scale Palestinian
emigration, whereas Israeli economic expansion in the early 1970s
stemmed the tide. There was a demand for Palestinian labor, and
many workers found employment in the Israeli economy. This,
however, proved to be a temporary trend, and the Israeli economic
slowdown of the mid-1970s, combined with opportunities in the Gulf
states, resulted in a sharp increase in Palestinian emigration. At
the same time, accumulated savings and external Arab financing
precipitated an increase in construction in the West Bank and Gaza,
and this countered the trend to emigration.
In the early 1980s migration to the Gulf states reached a peak, but
the proportion of Palestinians was lower than it might have been,
due to the preference of the Gulf states for what they regarded as
"less volatile" workers from Arab countries with "moderate"
regimes. This was true even of Iraq, which employed 1.5 million
Egyptians, preferring them to Syrians, despite the diplomatic break
between Iraq and Egypt resulting from the peace agreement with
Israel.
Few Palestinians have been granted citizenship by the Gulf states,
even those who have lived there since 1948. Kuwait and the United
Arab Emirates took steps in the early 1980s to ensure that their
Palestinian populations would not increase. One of the measures
adopted was to require migrant workers who wanted to change jobs to
leave the country first. These regulations were aimed mainly at
residents of the West Bank and the Gaza Strip. Palestinian
researchers were prevented from participating in Kuwaiti research
projects, and Palestinian tourists were often turned back at the
border. The Kuwaitis even went so far as to obtain a computer
program from a Scandinavian country that checked the names of
people entering the country against lists of Palestinian names to
see whether the date and place of birth had been altered. This
measure was aimed against Palestinians who might have obtained
citizenship of another Arab country.
The situation became even worse after the Iraqi invasion of Kuwait
and the Gulf War. The decrease in Gulf oil revenues, and the
development of local labor forces, combined with Palestinian
support for Iraq during the Gulf War, adversely affected employment
prospects for Palestinians in the Gulf.
The Palestinian Labor Force
The population of the occupied territories at the end of 1991 was
estimated at 1,682,000 (1,005,600 in the West Bank, and 676,100 in
the Gaza Strip). This population continues to increase rapidly, due
to high birth rates, reduced mortality rates, and changing
migration patterns. The population is young, with some 47 percent
of the total under the age of 14. The labor force averaged 312,000
in 1991 (200,000 in the West Bank and 112,000 in Gaza), an increase
of 1.4 percent compared to 1990, which followed an increase of six
percent in 1990 compared to earlier years. In 1991 there was an
increase of 3.7 percent in the population over the age of 15 (to
834,000). The labor force, then, comprised 37.4 percent of the
population in 1991, compared to 38.3 percent in 1990.
According to the Israeli Central Bureau of Statistics, the number
of employed in the West Bank and Gaza decreased by three percent in
1991 to some 287,000. A larger reduction took place in the West
Bank (seven percent, comprising 180,000 workers), while employment
actually went up in the Gaza Strip (four percent, comprising
107,000 on a weekly basis). During this period the rate of
unemployment in the territories reached 7.9 percent (compared with
3.7 percent in 1989 and 1990). Unemployment in the West Bank
trebled from 3.6 percent in 1990 to 10.3 percent in 1991; but
remained constant at 4.1 percent in the Gaza Strip.
Palestinian observers maintain that the official Israeli figures
showing these relatively low levels of unemployment are wrong. They
say that some 35 percent of the Palestinian population was
unemployed in 1990.
The Intifada caused significant changes in the labor force employed
in the occupied territories. West Bank workers who lost their jobs
tended to leave the labor force or emigrate, whereas Gaza workers
tended to seek alternative employment. The reason for this is that
the Gaza inhabitants do not possess Jordanian passports, as many
West Bankers do, and consequently it is more difficult for them to
travel.
Conclusions
Although the Intifada and the Gulf War did not have a significant
impact on the number of Palestinian workers employed in Israel,
they did affect Palestinian employment patterns in the Gulf States,
in Jordan, and in the territories themselves. The Israeli closure
policy resulted in a considerable reduction of Palestinians
employed in Israel, although this was modified in subsequent
months. Nevertheless, unemployment in Israel, the substitution of
Palestinian workers with new immigrants, and further immigration
from the former Soviet Union will eventually reduce the need for
Palestinian labor inside .Israel. Furthermore many Israelis would
like to see the Palestinian labor force in Israel reduced, both to
lessen hostility between Israelis and Palestinians, and to
encourage Israeli technological progress that has been hampered by
the continued availability of cheap Palestinian labor.
It seems that more than two decades of a single Israeli-Palestinian
economy are coming to an end. Unemployment has increased, living
standards have declined, and the United Nations Relief and Works
Agency is distributing basic food supplies to most of the
Palestinian population. In some places, unemployment could be as
high as 50 percent. As the population is relatively young,
increasing numbers of young persons will be joining the potential
workforce in the next few years, making the situation even worse.
This is likely to be further aggravated by the decrease in
emigration, leading to a higher proportion of males in the
population and increased birth rates. The situation is liable to
become particularly serious in the refugee camps, which may become
breeding grounds for extremism and violence.
Significant changes can only be achieved by the massive injection
of foreign capital, and the preparation of a Marshall-type plan for
the territories. There are a number of businessmen and
entrepreneurs in Gaza and the West Bank, who are fully capable of
making constructive use of foreign investment. At the same time,
cooperation with Israel will increase cost-effectiveness and create
an opening for reconciliation and a new and more healthy
relationship between Israelis and Palestinians.
Israel took some steps, such as issuing more than 100 permits for
new businesses in the West Bank and Gaza in 1991, compared to less
than 10 per year in the 1980s. Moreover, the Israeli Government
accepted the Sadan Committee's call for the cancellation of
administrative restrictions on investment and an end to harassment
of local businessmen on tax issues.
In the absence of an established local base of production, Gaza and
West Bank Palestinians will continue to seek employment in Israel,
Jordan, and the Gulf States. Of the three, Israel has proved best
able to offer the Palestinians work in the short term. Even during
the Intifada, tens of thousands of Palestinians continued to find
jobs in Israel; but, in the medium and long term, other solutions
have to be found. Only comprehensive regional cooperation will be
able to create a local production base with significant employment
opportunities in the West Bank and Gaza.
Bearing in mind that between 750,000 and one million Palestinians,
at present in refugee camps in the neighboring Arab countries, may
want to return to the territory of Palestinian self-government,
stepped up development is essential. Massive foreign investment
must be encouraged; restrictions on marketing West Bank and Gaza
produce in Israel, Jordan, Egypt and Europe must be removed. A
framework of peace and regional cooperation is required to create
employment opportunities for the Palestinians, to the benefit of
all the states and societies in the region.