Beyond Rentierism: The Building Blocks Of The Workfair State | Amman Institute

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On 8/7/2010 Dr. Omar Alrazzaz gave Amman Institute staff a presentation entitled “Beyond Rentierism: the building blocks of the workfair state”

Dr. Omar Alrazzaz is the Director General of the Social Security Corporation (SSC) in Jordan.

Published in: Economy & Finance, Technology
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Beyond Rentierism: The Building Blocks Of The Workfair State | Amman Institute

  1. 1. Beyond Rentierism: the building blocks of the workfair state July/2010
  2. 2. Outline• From rentierism to workfair.•Status quo of labor market.• Challenges.• From short-term measures to a national strategy for employment.• The Role of Amman Municipality.
  3. 3. • From rentierism to workfair. • Macro-economy • Micro-economy. • Political dimension • Social dimension.
  4. 4. Status Quo of Labor Market Labor market conditions are not in favor of SSC’s financial position ُEast Asia & Pacific Paraguay Philippines Latin America & Caribbean Jamaica Europe & Middle Asia Syria South Asia Sri Lanka Guatemala Morocco MENA Salvador Egypt 33 percent 6 percent Jordan 0 10 20 30 40 50 60 70 80 90 100 Employed Unemployed Not in the labor market.4
  5. 5. Status Quo of Labor Market Male Employed Female Employed Country Persons to Manpower Persons to Manpower 64% 12% Jordan 89% 39% Syria 84% 29% Morocco 78% 30% Tunisia 77% 22% Egypt * Data, 2005
  6. 6. Status Quo of Labor Market Distribution of Inactives: • Housewives, (50%). • Students,(30%). • Early Pensioners, (20%).
  7. 7. Status Quo of Labor Market Non-Jordanian Workers: • Around (420) thousands are non-Jordanian workers – MOL Estimations. • Two times this number are unemployed Jordanians. • The above two groups are similar in terms of age and education.
  8. 8. Challenges • Demographic changes accompanied by: – Early retirement pension prevails over other pensions. – Decrease in fertility & mortality rates. – Conditions of the labor market. 5 Insured Persons 1 Insured Person 1 1 Pensioner Pensioner8
  9. 9. ChallengesChallenge:• Increase in jobs created from (50) thousands to (100) thousands.• Increase Jordanians’ share in jobs created from 50% to (85%) in 2020, and (95%) in 2030.• Increase in the share of Jordanians in the labor force.
  10. 10. Challenges Expected % of Work force Employed Persons Employed Year Population (Million) (Million) to work (Million) force 2010 6.0 3.0 1.0 33% 2020 7.5 4.4 2.0 45% 2030 9.0 6.0 3.0 50%
  11. 11. From short-term solutions to a nationalstrategy for employment • Short-terms & unsustainable measures: 1. Employ Jordanians in the public sector for Jordanians. 2. Reliance on non-Jordanian workers in the private sector. 3. Encourage exporting qualified workers to Arab Countries.
  12. 12. From short-term solutions to a nationalstrategy for employment • Towards a national strategy for employment: First: Legal Frame. 1. Labor Law: stabilizing labor market, protecting workers. 2. Social Security Law: Extending coverage, new insurances. 3. Health Insurance. Second: Investment Policies & Economic Development: 1. Focus on added-value in investment promotion policies. 2. Make profits generated from speculations in stock market and real estate market subject to taxes. 3. Encourage efficient, labor intensive sectors.
  13. 13. From short-term solutions to a nationalstrategy for employment Third: Education Policies: 1. Matching between the outcomes of the educational sector and labor market (number & majors). 2. Focus on education that is consistent with the needs of the knowledge-based economy. 3. Team work, critical thinking, & information-searching skills. 4. Promotion of Citizenship and volunteer work. Fourth: Supply & Demand Geography: 1. Facilitate transportation to workplace. 2. Internal housings for workers.
  14. 14. From short-term solutions to a nationalstrategy for employment Fifth: Enhance women participation in Labor Market 1. Maternity Insurance. 2. Nurseries. 3. Micro-finance. 4. Home-based occupations. Sixth: Promote vocational & technical occupations: 1. Restructuring vocational training. 2. Return to military service in a way that serves building capacities and skills of fresh graduates. 3. Awareness-raising campaigns to promote this culture.
  15. 15. Role of Amman Municipality . • Transportation • Housing • Cost of business operation.
  16. 16. Recommendations • National Strategy for Employment that: • Matches between supply & demand over the next (10) years. • Produces time-lined action plans and programs for productive sectors in a way that gradually replaces non- Jordanian workers by Jordanians. 1. Plan for matching between education policies & demands of labor market. 2. Increases productivity of Jordanian worker. 3. Contributes to restructure Jordanian economy to be oriented towards high added-value goods & services.

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