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Atlas of Jordan

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Myriam Ababsa

Chapter eight - Social Disparities, Poverty Alleviation and Employment Policies

Challenges Facing Jordan’s Labour Market

Jalal Al Husseini

Texte intégral

1Despite relatively high GDP growth rates in the 2000s, (between 5% and 8% from 2000 to 2008 and 3 to 4% since the outbreak of the global economic crisis in late 2008 (World Bank d)), Jordan’s labour market indicators have been alarming. The participation rate of Jordan’s workforce has remained one of the lowest in the world at about 40%, and the country’s unemployment rate is high, stagnating at about 12 to 15% since the year 2000 (DOS 2000-2010). Data and predictions indicate that despite downward demographic trends, the pressure on the local labour market will remain severe during the next decade due to the current 15-24 age group which is still large due to the higher fertility rates of the past. The Department of Statistics forecasts that by 2020 more than two-thirds of the population will be at working-age (DOS 2007). Other major specificities of the Jordanian labour market, not fully taken into account in DOS Employment and Unemployment Surveys, are the influx of some 300,000 low-skilled foreign workers (MOL 2009) and the emigration of over 260,000 skilled and/or experienced Jordanian workers toward the Gulf (DOS 2008, 2009); under-employment, in both its visible (part-time official jobs) and invisible (low productivity) forms; and informality, with an informal economy that is said to cover one-fifth to one-sixth of the Jordanian workforce (World Bank c).

Figure VIII.24 — Refined Participation Rate according to Area of Residence (urban/rural)

2in 2010.

Low participation in general, but more so in rural areas and amongst women

3In 2010, the proportion of working aged Jordanians (aged 15 +) actively participating (either as employed persons or as job seekers) in the local labour market was estimated at 39.5% (DOS 2010). In absolute numbers, about 1.4 million Jordanians were economically active, including 1.2 million employed (of whom 1 million were men) and 182 thousand unemployed (118 thousand men) (Al Manar 2009). Such figures do not compare favourably with the average Middle East participation rate that stands at about 51.5% (in 2009) and with the global average at about 64.7% (in 2009) (ILO 2010).

4Available statistical data points to much lower economic activity rates amongst Jordanian women (14.7%) than amongst Jordanian men (65%). In 2010, the male population reached almost universal participation in the 25-39 age group (93.4%), while the rate for women in the same age group (their maximum rate) reached only 25.2% (DOS 2010). This difference was noted regardless of the level of education. While the participation of both Jordanian women and men increased with their level of education, 84.1% of male university graduates were economically active compared to 61.8% of women of the same educational group. At the other end of the educational spectrum, 25.6% of illiterate male Jordanians were economically active compared to 1.5% of illiterate female Jordanians (DOS 2010) (fig. VIII.25).

Figure VIII.25 — Refined Participation Rate among Jordanians aged 15+ by sex (percent) 1979-2009.

Figure VIII.25 — Refined Participation Rate among Jordanians aged 15+ by sex (percent) 1979-2009.

5Yet, longitudinal analysis shows that women’s economic activity rates have grown steadily over the past decades, from a low 6.4% in 1979 to 15% since 2007, mainly as a result of lower fertility rates (from 7.4 in 1976 to 3.2 in 2004, according to national censuses) and women’s higher level of education: In recent years, the number of female students in Jordan’s public and private universities has overtaken that of male students (in 2009/2010, 28,457 of the 54,721 BA/Bsc students were women (MOHE 2011)). Conversely, men’s economic activity rates have declined since the late seventies, thus closing the participation gap between men and women from 69.9 percentage points in 1979 to 48.8 percentage points in 2010.

Why are so few Jordanians economically active?

6The Jordanians’ low economic activity rates are said to result mainly from a series of structural socioeconomic factors, including:

  • The age structure of the Jordanian population is still weighted towards the younger population groups resulting in relatively large numbers of economically inactive high school and university students. Between 1979 and 2004, the proportion of Jordanian students who completed secondary education (the Tawjihi –baccalaureate) increased from 14.7% to 35%. The number of BA graduates has tripled from 3% to 9% of the population during the same period (Al Khaldi 2006).

7In 2010, students made up one third (31%) of Jordan’s economically inactive population (DOS 2010).

  • The relatively high proportion of Jordanians “with means”, who can afford not to be economically active (8%) (DOS 2010). This results mainly from the extensive use by public sector employees of the early retirement scheme (until 2010: at the age of 45 instead of 60 for men and 55 for women); and from those Jordanians benefitting from welfare support or remittances sent by relatives (mostly working in the Gulf countries).

  • The high proportion of Jordanian women who engage solely in household duties. In 2010, 56% of all economically inactive Jordanians were women categorized as ‘housemakers’. Several qualitative studies have pinpointed the adverse impact socio-cultural factors (not taken into account in official surveys) still have on women’s employment. Women’s social status is said to be primarily associated with that of wives and mothers, and cultural restrictions to their mobility still exist in rural areas. Such a ‘gendered’ perception of household roles is also said to pervade Jordan’s school curriculum that tends to confine women to jobs such as teaching or nursing. This is also endorsed by Jordanian legislation that has long denied women the same rights as men in terms of freedom of movement, choice of residence and domicile (World Bank 2008; Peebles et al. 2007).

8More concretely, statistical evidence shows that marriage also constitutes an obstacle to women’s access to and careers in the labour market: in 2010, only 12.7% of married or previously married women were economically active (11.1% employed, 1.6% unemployed) compared to 19.9% of women who had never married (13.4% employed, 6.3% unemployed). The causality link is reversed for men because they tend to be the household breadwinners: 74.5% of married/previously married men were economically active (71.2% employed, 3.3% unemployed) compared to 51.3% of men who had never married (40.7% employed, 10.6% unemployed) in 2010 (DOS 2010).

Persisting high unemployment rates

9The unemployed are officially defined as persons aged over 15 who have not worked for one hour or more during the seven-day period before the day of the interview and have been actively searching for work (DOS 2010). They do not include “discouraged workers”; unemployed persons who are not looking, or have stopped looking for work because they believe that “no work is available” (26% mostly in rural governorates) or that there are “no suitable jobs” (23% mostly in urban governorates) or because they are tired of seeking work (16%) (DOS 2010).

10Despite job opportunities that match the number of new entrants on the labour market (about 65,000-70,000 yearly), official unemployment rates have exceeded the 12.5% mark since the 1990s, compared to an average of 6% in the 1980s and 8% in the 1970s (DOS 2010 and previous years; Ratrout F. et al. 2004). Experts have warned that under current labour market conditions, unemployment could reach 20% by the year 2015 (National Agenda 2005). The global financial and economic crisis has revived these fears since late 2008.

11The unemployed predominantly fall in the following (overlapping) categories: young adults, women and inhabitants of rural areas (fig. VIII.26).

Figure VIII.26 — Unemployment rate (Jordanians aged 15+) in % by age groups, 2010.

Figure VIII.26 — Unemployment rate (Jordanians aged 15+) in % by age groups, 2010.

1) Young adults

12Unemployment rates amongst the 15-19 and the 20-24 age groups have stood twice above the national average since the early 2000s. In 2010, 30% of 15-19 year-olds and 26% of 20-24 year-olds were unemployed. Unemployment rates tend to decline sharply in the 25-39 age group, when Jordanian adults have to cater for their households needs, as well as in the 40-54 age group, when many Jordanians benefit from the early retirement option.

2) Women, especially the youngest and most educated women

13Jordanian women are traditionally more prone to unemployment than Jordanian men. In 2010, the proportion of unemployed female Jordanians was about twice as high as that of unemployed male Jordanians: 21.7 versus 10.4, respectively (DOS 2010). Female unemployment was especially high in the younger age groups, reaching 38.9% in the 15-19 age group and 47.2% in the 20-24 age group, compared to 32.7% and 20.7%, respectively, for men (DOS 2010). Moreover, women are more prone to long-term unemployment than men: in 2010, 44% of unemployed women had been without work for over one year, compared to 30% of unemployed men (DOS 2010).

14Access to higher education has not helped Jordanian women to close the unemployment gap. On the contrary, it is amongst female university graduates and holders of the post-secondary intermediate diploma that the highest unemployment rates are recorded: 24.9% and 22.7% respectively, compared to 16% for women who did not complete secondary education and 13% of those who just obtained the baccalaureate diploma (DOS 2010). Conversely, it is amongst those men who did not complete secondary education that the unemployment rate is highest (19.9%), ahead of post-secondary graduates (18.2%) and holders of a baccalaureate (7.7%). Today, 21.2% of all unemployed men are post-secondary graduates (DOS 2010). In absolute terms, however, given their demographic prevalence on the labour market, male jobseekers remain relatively more numerous. In 2009, they constituted 65.5% of the total population of unemployed Jordanians (180,284 unemployment men compared to 62,163 unemployed women) (Al Manar 2009) (fig. VIII.27).

Figure VIII.27 — Unemployment trends, from 2000 to 2010.

Figure VIII.27 — Unemployment trends, from 2000 to 2010.

3) Rural areas and governorates

15From a geographic perspective, unemployment rates have traditionally been higher in rural areas (13.9%) than in urban areas (12.2%); and higher in predominantly rural, sparsely inhabited, governorates such as Kerak, Ma‘an and Madaba (14.5% and over) than in urban governorates such as Amman, Zarqa and Irbid (below the average 12.5 percent) (fig. VIII.28). The rural governorates’ higher levels of unemployment have been ascribed to both the concentration of jobs in urban governorates (and the high cost of housing in urban areas) and to the lack of transportation or reluctance to use it, especially amongst women (World Bank 2008: 14).

Figure VIII.28 — Unemployment rate and the distribution of unemployed persons in 2010.

Figure VIII.28 — Unemployment rate and the distribution of unemployed persons in 2010.

16A geographical mapping of unemployment by gender reveals not only higher unemployment rates for women across the governorates (with a maximum of 32.2% of female unemployment in Ajlun versus a maximum of 13% of male unemployment in Madaba), but also larger discrepancies between unemployment rates of rural and urban governorates for women (13 percentage points between Ajlun and Amman) than for men (3.2 percentage points between Madaba and Amman) (fig. VIII.29 and VIII.30).

Figure VIII.29 — Men’s Unemployment rate in 2010.

Figure VIII.29 — Men’s Unemployment rate in 2010.

Figure VIII.30 — Female’s Unemployment rate in 2010.

Figure VIII.30 — Female’s Unemployment rate in 2010.

 

Friday in Ramtha (Msakhan)

Friday in Ramtha (Msakhan)

M. Ababsa

17However, because of their demographic weight, urban governorates still have the largest share of the total number of unemployed Jordanian men and women. The Amman governorate itself is home to over one-third of Jordan’s unemployed.

Figure VIII.31 — Distribution of Male and Female Employed Jordanian by economic activity in 2010.

Figure VIII.31 — Distribution of Male and Female Employed Jordanian by economic activity in 2010.

The determinants of unemployment

18Jordan’s high levels of unemployment may be ascribed to several sets of causes:

1) Discrepancies between the requirements of the labour market and job seekers’ skills and expectations

19Since the 1960s, many highly educated Jordanians have left their country for better and more rewarding professional opportunities abroad. In 2008, the Jordanian expatriate population was estimated at over 260 000, namely half of the total employed population in Jordan and one-third larger than the number of employed Jordanians with a post-secondary education diploma (Jordan Times 2009). Educated Jordanians residing in the country are often said to lack the professional skills required by private employers. They tend to enrol (especially women) in ‘generalist’ streams such as humanities (26.4% women versus 14.1% men), education sciences (18.7% versus 4.3% men) and social sciences (26% versus 34% men) (DOS 2010), which lead to mid-level, public sector occupations, that have seen little or even negative growth. Since the early 2000s, the labour market has mostly generated jobs at the highest and lowest ends of the occupational spectrum (World Bank 2008: 23). Indeed, the highest unemployment rates (above 20%) are to be found amongst graduates from humanities and social and educational sciences streams (al-Charaa M. 2009, 172). Yet, mid-level public sector jobs have continued to be coveted by many Jordanians, especially Jordanian women, perhaps because they represent ‘safe’, sustainable jobs with retirement schemes.

20Conversely, the private sector is mostly made up of small, family-run businesses with fewer than 5 employees. Informal employment, characterized by lower salaries and substandard working conditions, is widespread in this sector. The informal economy has three main sectors: vehicle sales and repairs (32.2% of informal labour), transport and storage (14.8%) and manufacturing (14.7%) (fig. VIII.32).

Figure VIII.32 — The distribution of Informal employement by economic sector in 2010 (Mopic 2012).

Figure VIII.32 — The distribution of Informal employement by economic sector in 2010 (Mopic 2012).

21Despite the ongoing privatization of the economy, the proportion of government employees remained stable between 2000 and 2010, at about one third (37%-38%) of employed men (368,000 men in 2009) and half (49.5%) employed women (94,000 women in 2009) (DOS 2010; Al Manar 2009). The proportion of employees in the private sector has only slightly increased during the same period, from 42.3% to 45.3% (750,000 persons in 2009). Finally, the proportion of non-employees has stagnated. In 2010, 7.1% of working Jordanians were employers (7.7% of men and 2.2% of women) and 9.2% were self-employed (10.5% and 2.4%, respectively) (DOS 2010). Moreover, the economic activity sectors of Jordanians have remained similar. Education has remained Jordanian women’s favoured activity (39% of employed women), while men favour public administration and related services sectors. The latter has expanded for both sexes since 2000, employing 26.3% of employed men in 2010, compared to 19% in 2000; and 12.7% of employed women in 2010 compared to 5.3% in 2000 (DOS 2010).

2) Disaffection with manual work

22The share of Jordanians engaged in formal manual economic activities has declined over time. In the agricultural sector at large, the decrease in the proportion of the labour force (2% in 2010 versus 5% in 2000) is related to the sector’s downfall within the Jordanian economy (from 6.6% of GDP in 1989 to 2.9% in 2009) (fig. VIII.31). However, the lower percentage of Jordanian workers in the manufacturing and construction sectors between 2000 and 2010 (from 12% and 7% in 2000 to 10% and 6% in 2010, respectively) contrasts with the boom of these sectors from 27% to 32% of GDP during the same period (DOS 2010; WORLD BANK).

23Over half of the 65,000-70,000 new jobs (most of which are provided by the private sector in the fields of construction, services and agriculture) have been filled by foreign workers, who numbered about 336,000 in 2009 (not counting informal workers, who were said to exceed 250,000), namely, one quarter of the Jordanian labour force and twice the number of unemployed Jordanians (Hindi L. 2008; MOL 2009). These figures indicate how instrumental foreign workers have been in key sectors of the Jordanian economy. This is particularly the case of Egyptian unskilled and semi-skilled workers, who made up 71% of the total number of migrant workers in 2009 (MOL 2009) (fig. VIII.33).

Figure VIII.33 — Selected Economic Activity Sectors and their Jordanian and Migrant workforce (2004 and 2009).

Figure VIII.33 — Selected Economic Activity Sectors and their Jordanian and Migrant workforce (2004 and 2009).

24Since the mid-2000s, the realization that Jordanians were not benefiting from their country’s economic growth has led to a public debate which identified several discrepancies within the Jordanian labour market, including job seekers’ lack of appropriate skills and the inefficiency and dilapidated state of governmental labour market-related institutions, such as the Ministry of Labour’s work offices and technical and vocational training institutions (VTC) (Mryyan N.). In particular, the VTC’s unenviable situation has reinforced the negative image that still pervades amongst Jordanians regarding manual work in general. In this respect, the awareness campaigns launched in recent years by the authorities for the promotion of manual jobs have pinpointed the negative impact the “culture of shame” (this refers to the Jordanians’ repulsion for jobs considered mundane, menial and/or exacting) was having on the country’s economy and society at large. Traditionally portrayed as inherent in the “Jordanian mentality”, the “culture of shame” has been said to “hijack the job market, whereby spawning further increases the demand for foreign labour” (Mryyan N.), and its perpetuators have been criticized for failing to realize that, as the Prime Minister put it in a speech before Parliament in January 2008, “work, no matter what it entails, is a thousand times better than staying at home and burdening the family” (Jordan Times, 16 January 2008).

3) Legal regulations and private employers’ choices

25Private employers (over 90% of whom run small-scale businesses with fewer than 5 employees) have tended to favour the recruitment of unskilled or semi-skilled foreign workers for low-qualified jobs. Such preference has been ascribed by employers to the fact that foreign workers are more hard working and more reliable than local workers (Center for Strategic Studies 2006). However, foreign workers are also more vulnerable and less likely to demand the implementation of the reputedly ‘rigid’ labour protection-inspired regulations contained in the labour law such as those constraining layoff practices, or setting minimum wages and maximum hours of work. This partly explains the spread of the informal economy in Jordan, and more especially the 30% rise in the number of foreign workers since the 1980s (Mryyan N. 2006 : 24).

26Similarly, well-intentioned regulations designed to protect the safety and the interests of female employees have paradoxically also negatively affected their involvement in the job market. This is the case for instance of regulations that specifically protect women (in a rather patronizing manner) from hard working conditions. By stipulating that the Minister of Labour can decide which industries and jobs are to be prohibited for women and the “times at which it is prohibited to make women work”, several observers consider that article 69 of the labour law has effectively limited women’s freedom of choice, potentially denying them access to certain professions or restricting their professional advancement in the formal economy (Peebles D. 2007: 19). Similarly, until 2010 liberal regulations imposing maternity leave compensation and protection for pregnant women, payable by employers alone, may have discouraged them from hiring women or encouraged them to fire female employees before having to abide by the law. This is despite the fact that women have traditionally been paid less than men (one third less amongst highly educated personnel, see DOS 2006).

Towards a reform of the Jordanian labour market: reform and challenges

27Since the mid-2000s, Jordan has embarked on multi-level national reform programmes aimed at achieving sustainable development in order to be able to tackle and cope with the opportunities and challenges of globalization. Improving the living conditions of Jordanians, notably through the provision of decent jobs, has remained at the core of programmes such as the National Agenda for 2006-2015 or Kulluna al-Urdun (KU - We are all Jordan) for the 2007-2015 period. Both national initiatives have laid the emphasis on the need to improve the employability of the workforce through the alignment of adequate formal education and technical training with labour market needs; to produce more jobs, especially in the marginalized areas of the country; to enlarge the workforce size by increasing the number of economically active Jordanians; and to improve labour market flexibility and productivity through less stringent labour laws, coupled with the introduction of safety nets.

28Accordingly, the Jordanian authorities have launched a series of socioeconomic policies and programmes designed to foster, directly or indirectly, the inclusion of all categories of the population within the formal local job market, with a special emphasis on those Jordanians most affected by labour market imbalances: the young; the inhabitants of rural areas and governorates; and women in general. These policies and programmes have consisted of developmental, labour-intensive programmes in disadvantaged areas (since 2008 in the governorates of Ajlun, Ma‘an, Irbid and in the Dead Sea area); the reform of the institutional set up and the curricula of both the academic and vocational and technical streams (featuring the involvement of Jordan’s army in vocational and technical training); and administrative and financial incentives/disincentives for private sector employers to hire more Jordanian labour instead of foreign labour and to locate their factories in remote areas and/or to hire more women from these areas (by covering the costs of transportation for instance).

29Other reforms such as that of the Social Security Corporation (SSC) are also expected to have positive impacts on the involvement of marginalized categories of the labour market: the implementation of maternity and unemployment funds financed by employees and employers (from September 2011) may promote the recruitment of women and encourage unemployed persons to remain in the formal economy.

30The less advantageous benefits offered by the early retirement scheme since 2010 (lower pension payments and delaying of the retirement age from 45 to 50) may lead to increased participation of experienced Jordanians in the labour market; finally, the regularization of the informal economy and the ensuing positive consequences on the workers’ living conditions and the economy at large may be boosted thanks to several measures adopted by the authorities since the late 2000s, including: the authorities have gradually extended the SSC’s coverage to businesses that had previously not had to register with it (those employing fewer than five workers); the institutionalization of social dialogue through the empowerment of the tripartite committee composed of representatives of employers, employees and the government; and the upgrading of the Ministry of Labour’s inspection and work offices personnel and operational procedures.

Milking sheep, Mount Nebo.

Milking sheep, Mount Nebo.

M. Ababsa

Table des illustrations

URL http://books.openedition.org/ifpo/docannexe/image/5039/img-1.jpg
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Titre Figure VIII.25 — Refined Participation Rate among Jordanians aged 15+ by sex (percent) 1979-2009.
URL http://books.openedition.org/ifpo/docannexe/image/5039/img-2.jpg
Fichier image/jpeg, 76k
Titre Figure VIII.26 — Unemployment rate (Jordanians aged 15+) in % by age groups, 2010.
URL http://books.openedition.org/ifpo/docannexe/image/5039/img-3.jpg
Fichier image/jpeg, 52k
Titre Figure VIII.27 — Unemployment trends, from 2000 to 2010.
URL http://books.openedition.org/ifpo/docannexe/image/5039/img-4.jpg
Fichier image/jpeg, 48k
Titre Figure VIII.28 — Unemployment rate and the distribution of unemployed persons in 2010.
URL http://books.openedition.org/ifpo/docannexe/image/5039/img-5.jpg
Fichier image/jpeg, 156k
Titre Figure VIII.29 — Men’s Unemployment rate in 2010.
URL http://books.openedition.org/ifpo/docannexe/image/5039/img-6.jpg
Fichier image/jpeg, 132k
Titre Figure VIII.30 — Female’s Unemployment rate in 2010.
URL http://books.openedition.org/ifpo/docannexe/image/5039/img-7.jpg
Fichier image/jpeg, 1,0M
Titre Friday in Ramtha (Msakhan)
Crédits M. Ababsa
URL http://books.openedition.org/ifpo/docannexe/image/5039/img-8.jpg
Fichier image/jpeg, 68k
Titre Figure VIII.31 — Distribution of Male and Female Employed Jordanian by economic activity in 2010.
URL http://books.openedition.org/ifpo/docannexe/image/5039/img-9.jpg
Fichier image/jpeg, 60k
Titre Figure VIII.32 — The distribution of Informal employement by economic sector in 2010 (Mopic 2012).
URL http://books.openedition.org/ifpo/docannexe/image/5039/img-10.jpg
Fichier image/jpeg, 72k
Titre Figure VIII.33 — Selected Economic Activity Sectors and their Jordanian and Migrant workforce (2004 and 2009).
URL http://books.openedition.org/ifpo/docannexe/image/5039/img-11.jpg
Fichier image/jpeg, 64k
Titre Milking sheep, Mount Nebo.
Crédits M. Ababsa
URL http://books.openedition.org/ifpo/docannexe/image/5039/img-12.jpg
Fichier image/jpeg, 74k

© Presses de l’Ifpo, 2013

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