4 million unemployed in Iraq amid the absence of solutions
Observers call for the private sector to be given greater importance by the state
Muayyad Al-Terfi is an Iraqi reporter
Thursday 12 May 2022 22:25
Al-Rusafi Square in Baghdad, which is located near one of the important markets in Baghdad (The Independent Arabic)
It seems that finding solutions to the file of the unemployed in Iraq will be out of reach during the coming period,
because the state does not have a clear vision that includes providing job opportunities outside the public sector, which has ballooned in the past ten years to accommodate a large segment of Iraqi youth, which has caused great pressure on the budget. the public.
In an economic situation that lacks the presence of an active and widespread private sector in all areas of life and the control of the state and its penetration into several economic sectors,
it has become difficult to find quick solutions to the problem of unemployment in Iraq until after determining the state’s competencies in economic work, which still ranges between a plan for economic reform The government presented it in its white paper and a broad parliamentary trend rejecting reducing the role of the public sector in agriculture and industry.
Despite the improvement in the financial situation of the Iraqi state during the past few months, the increase in central bank reserves to more than 70 billion dollars, the decrease in the internal debt rate to 70 trillion Iraqi dinars (about 50 billion dollars), and the decrease in external debts to 20 billion dollars,
these matters did not affect In achieving reform of the unemployment file in the country because the current government has limited powers and cannot take strategic decisions regarding this file, despite the Oil Ministry’s announcement early this year that it achieved additional revenues from oil sales amounting to 16 billion dollars during 2021.
4 million unemployed
The Ministry of Labor and Social Affairs revealed that there are more than 4 million unemployed Iraqis. Undersecretary Abeer Chalabi told the government newspaper, Al-Sabah, that "the ministry has registered more than two million unemployed people in its database, and there are similar numbers to the unregistered unemployed," noting that
"the phenomenon of youth begging is not caused by a lack of job opportunities, but rather by Social reasons represented in family disintegration and the spread of drugs, especially in poor regions and governorates, where most of their children resort to the capital to escape their difficult reality.
For years, the Iraqi government has implemented a special system for social welfare to help the groups most in need of support, such as the elderly, divorced women, widows and the unemployed.
Under this system, more than 1.6 million Iraqis have been included, receiving financial support ranging from $70 to $170 per month.
13.8 percent unemployment rate
For his part, Ministry of Planning spokesman Abdul-Zahra Al-Hindawi said that "the percentage that was registered during the past years amounted to 13.8 percent."
He explained in an interview with "The Independent Arabia", "We recently conducted a survey of the Iraqi labor market, and the ministry will soon have, according to this survey, new indicators of unemployment rates, and we will find out, if they decreased or increased."
Attention to the private sector
Al-Hindawi added that "the government's tendency is to pay attention to the private sector because it is able to contribute to providing job opportunities and absorbing the increases in the Iraqi labor market," noting that
"this trend comes in conjunction with the inability to provide job grades in state institutions due to the inflation witnessed by the functional body. in the country".
Since the fall of Saddam Hussein's regime in 2003, successive Iraqi governments, under pressure from the parties participating in the political process, opened the door wide for appointments to state departments as an important part of their campaign for elections, which raised the number of public sector workers from 850,000 in 2003 to 4.5 million. Currently employed and employed.
With this terrifying increase in the number of workers in the public sector and the state’s inability to pay the salaries of a large part of them except through loans and absorb new numbers of workers in it, the government of Prime Minister Mustafa Al-Kazemi aims, through the new labor and social security law, to divert the demand towards the private sector and convince Young Iraqis work in it, rather than mediating and paying bribes to get a low-paying job.
Al-Hindawi pointed out that "the trend towards the private sector requires providing an appropriate environment to work in this sector, including providing guarantees for its workers, similar to the public sector," noting that
one of the reasons for reluctance to work in the private sector is the lack of social guarantees for workers, and therefore the lack of an environment suitable".
Al-Hindawi explained that "the Ministry of Planning has initiated the formation of a council for the development of the private sector, headed by the Minister of Planning.
The council is working temporarily to provide the internal system and the integrated floor for the permanent council," noting that
"the council will take upon itself the coordination between the government and private sector formations and its activities in general and will have a voice in economic decision making.
According to the latest census conducted by Baghdad in 2020, Anbar Governorate (west) recorded the highest unemployment rate at 32.4 percent, while the rate in Kirkuk Governorate reached 6.3 percent, which is the lowest compared to the rest of the Iraqi provinces.
The unemployment rate in rural areas was 14%, compared to 13.2 in urban areas.
The percentage is up to 20 percent
In turn, the financial advisor to the Prime Minister, Mazhar Muhammad Salih, said that the official figure indicates the presence of 20% of the actual unemployment of the labor force.
He pointed out that "the contribution of real sectors to productive activity continues to decline, as the contribution of the manufacturing industry still constitutes only 1%, With the almost complete death of local crafts due to the policy of uncontrolled import trade openness, as well as the incomplete application of the National Product Protection Law,” noting that
“this reality does not help much in providing great job opportunities.”
Since 2003, Iraqi markets have witnessed an unprecedented openness to The import of goods and merchandise at very cheap prices led to the collapse of the local industry and the sudden layoff of thousands of workers, a large part of them skilled.
Saleh pointed out that "the issue of investing in the development of major income-generating projects that employs work is the central wheel of large employment for the unemployed, as well as the importance of spreading the financing of small and medium youth projects within well-studied stimulating project packages provided by the state based on the proposal of the Ministry of Labor and Social Affairs.
In these projects, the young workforce develops to develop lost productive activities, including crafts that have withered. He stressed that "the country needs a comprehensive national operational program to ensure stability and prosperity."
The Iraqi economy depends mainly on the export of crude oil to obtain its financial imports, and it constitutes more than 90 percent of its annual revenues, the majority of which go as salaries and grants to different segments of society.
The numbers are bigger
In this context, Manar Al-Obaidi, head of the "Future Iraq" Foundation for Economic Studies, said that "the real unemployment rate is higher than the rates announced by the government because the latter does not have accurate statistics."
He added that "there are non-workers in the private labor market, in the so-called 'random labor market', as there are no laws to protect them and there are no statistics about their numbers or social security laws of their own," noting that
"the real problem in Iraq is the organization of a market the work".
Al-Obaidi explained that "there are many unregistered professions, and therefore the rights of their workers are not guaranteed, and they are like the unemployed, they do not differ from the unemployed except by taking the wage, but they do not have rights," considering that
"the measurements of the Ministry of Planning are not Accurate, given the lack of a population census in Iraq, random samples cannot be measured against the community, as some cities have an unemployment rate of 50 percent, such as Samawa, Diwaniyah and Mosul.
He expected that "the unemployment rate in Iraq will be very large, especially as the population increases by one million people annually, and the number of graduates increases by 500,000 people annually," noting that
"the number of the unemployed among these graduates reaches 350 thousand, and therefore their number greater than the number announced by government reports.
He considered that "a country that has financial abundance, while unemployment and poverty rates are high, is considered a failure in management because it is known that these percentages are recorded in poor countries that have no money."
Al-Obaidi called for "the adoption of initiatives for real projects, as the local product in the sectors of agriculture, industry and tourism cannot provide large amounts of job opportunities," noting also that
"the industry has become advanced and does not need many employees in the factories, unlike tourism, agriculture, services and banks."
He pointed out that "these sectors need to be developed through initiatives undertaken by the Iraqi government and through the Central Bank to encourage work in these sectors," stressing that
"there is a theory in the economy that says that increasing the GDP in a sector by 1% provides job opportunities. It is estimated at 2 percent, and this does not exist in Iraq."