Palestinian unemployment rate soars as war wages on

The ongoing conflict between Palestine and Israel is having damaging consequences for all involved. Unemployment is no exception, and studies show that job loss could cripple Palestine economically.

A shocking 507,000 jobs have reportedly been lost across Occupied Palestinian Territory (OPT) as of January 2024, according to research from the International Labour Organisation (ILO) and the Palestinian Central Bureau of Statistics (PCBS).

As of 31 January, the Gaza Strip saw a loss of 201,000 jobs, equating to around two-thirds of all employment in the area. Meanwhile, a reported 306,000 jobs were also lost in the West Bank.

The ILO regional director for Arab states, Ruba Jaradat, commented on the statistics: “In addition to the devastating and catastrophic loss of life and with the people of Gaza on the brink of mass starvation, the war in Gaza has also caused an economic and social crisis that is unprecedented in the Occupied Palestinian Territory.”

“In Gaza, entire neighbourhoods have been wiped from existence. Infrastructure, energy and water facilities have been demolished. Schools, medical facilities, and businesses have been destroyed. This has decimated entire economic sectors and paralysed labour market activity, with untold repercussions on the lives and livelihoods of Palestinians for generations to come.”

Unemployment in the area has reached dire heights, with forecasts estimating it will reach 42.7 per cent in 2024. If hostilities persist in the next quarter, the annual rate is projected to rise to 45.5 per cent. Meanwhile, if the conflict continues until the end of March, the unemployment rate in OPT could hit 57 per cent for the first quarter of the year.

This job loss is having severe effects on the economy. According to reports, this accounts for losses of around US$21.7 million per day. When combined with the loss of wages for workers, this figure jumps to US$25.5 million each day.

The gross domestic product (GDP) in OPT contracted by a third between Q4 2022 and Q4 2023. The decline was over 80 per cent in the Gaza Strip and 22 per cent in the West Bank. GDP is projected to decline by a further 15 per cent across the two areas of the OPT if the war continues until mid-2024.

The resulting impact has exacerbated talent shortages, with participation rates for men projected to decline 3.6 percentage points, and 1.2 percentage points for women, if hostilities continue until mid-year.

Jaradat concluded: “We are working with our partners and the international community to provide both immediate relief and longer-term assistance to mitigate the impact of the crisis on affected Palestinian workers and employers.”