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Jordan: prospects for economic resilience

On the heels of the highest unemployment rates in 25 years, the Jordanian government announced in late February that it would create 3,300 job opportunities for youth across all Jordanian governorates. Encouraging economic development and activity outside of Jordan’s main metropolis, Amman, the Jordanian government seeks to re-enfranchise educated Jordanian youth, who currently face an overwhelming unemployment rate of 24.1%. A response to broad social discontent over slow economic growth and IMF austerity measures,  job creation is crucial to reopening overcrowded career fields and attracting women’s participation in the labor market. The latter goal is key, as 68% of educated, unemployed youth are women. The gender employment gap extends beyond educated youth as well, with the overall unemployment rate for men registered at 16.0%, compared to 27.8% for women.

Jordan unemployment rate over time
Jordanian unemployment rate from 2015 to 2018

According to Jordan’s Royal News, the program prioritizes sectors such as tourism, health, and communications in order to attract the thousands of university graduates who work in jobs unrelated to their academic disciplines in the country. Improvements in tourism, mining, and quarrying are expected to provide a modest improvement in growth in 2019; however, the economy remains burdened by ongoing tensions in Syria, slow revival of economic cooperation with Iraq, and economic stagnation in the Gulf Cooperation Council (GCC). Since the beginning of 2019, almost 2,000 male and female youth have already been employed, a number projected to rise over the rest of the year. According to the World Bank, Jordan’s GDP is expected to grow by 2.5% in 2019, up from 2.1% in 2017.

Job creation is but one effort made by the Jordanian government to address public grievances following widespread protests in 2018 – the largest protests in Jordan since the Arab Spring in 2011. The protests were a response to a proposed tax code that would have introduced austerity measures intended to target tax evasion and increase the amount of Jordanians who pay taxes from 4.5% to 10%. Protesters accused the government of targeting the more than 650,000 registered Syrian refugees with its tax plan, and ultimately secured the resignation of the country’s Prime Minister Hani al-Mulki in response. In order to integrate Syrian refugees into Jordanian society and stimulate the economy, the Jordanian government allowed Syrians to apply for work permits in 2017 in the agriculture, construction, textile and food industries. Despite a variety of attempts at reform, Jordan’s economy remains in a low-growth scenario and faces significant vulnerabilities, dampening its potential for resiliency.

 

Sources and Readings:

Jordanian Ministry of Labor 2017 Employment Report : Ministry of Labor (Arabic Text)

Jordanian Government Provides 3,300 Job Opportunities to Youth in All Governorates : Roya News

Jordan Unemployment Rises in 2018 : Roya News

Factbox: Jordan’s Austerity Protests : Atlantic Council

Jordan Data Suggest Universities Contribute to Unemployment: Al-Fanar Media

Jordan : World Bank Group

Jordan Protests: What You Should Know : Al Jazeera

New Deal on Work Permits Helps Syrian Refugees : UNHCR

Jordan’s Prime Minister Resigns Amid Protests Against Austerity : NPR