Displaced and refugee families in Suleimaniya ... - Kurdish Globe

The Kurdish Globe No. 314, Saturday, July 23, 2011 13Grabbing the bull by the horns:tackling Kurdish unemploymentBy Swara KadirSwara7kadir@aol.comUnemployment in Kurdistanhas become a problem thatcannot be ignored any longer.The lack of reliable statisticscontinues to pose a problemin getting the facts straight,but in 2008 the Kurdistan Regcgional Government's Ministryof Planning estimated unempcployment at 15 percent. Thatestimate was most likely basedon people who didn't have anyjob at all in the public sector orotherwise. Unofficial statisticsrate unemployment at 50 perccent, which includes peoplewho are hired by the governmcment but are not “working” oremployed as active, productiveemployees, so it's called “hiddcden” or “covered” unemploymcment. Today in Kurdistan thereare more than 1 million publicsector employees.It's estimated that more than60 percent of the entire Kurdicistan Regional Governmentbudget goes to paying thoseburdensome salaries, which isbleeding the economy dry. Itis creating a huge nanny statethat pretends to be productctive. Daring steps are neededto tackle this problem from theroot; a look back at Germany'shistory may provide some inscspiration. Without real changein the current economic policy,unemployment will continueto spread like cancer, cripplingthe nascent Kurdish economy.It’s a sorry sight to go to somegovernment departments thatprovide citizen services, partcticularly public sector banks.You will see a number of empcployees sitting there, doingnothing, while only a few areactively working. This is havicing an adverse effect, destroyicing motivation other staff mayhave to work and be productctive. Despite the large numberof government employees inthe different departments, partcticularly the ones that deal withservices and citizen needs, theyare bureaucratic and ineffectctive, with lots of red tape thatneeds cutting before anythingis achieved. Lines are long,frequent mistakes are made oncitizens' official paperwork,files get lost. Getting nationalidentification takes weeks ofgoing back and forth betweendifferent departmental offices,filled with employees whodon't get the job done. It’s asorry state, and so far nothingeffective has been done aboutit.Even the idea of relieving theextra government employees ofNumber of unemployed people sitting on the side of an Erbil Downtown street in this file photo.their jobs would cause severediscontent and disenchantmentwith the government and couldlead to riots. This is no wondcder when a person's livelihoodis under threat. What makesthings worse is the currentwave of public discontent thathas spread in the Middle Eastand caught on in Kurdistan,although street demonstrationshave stopped, but it's quitelikely a government initiativeto lay off large numbers ofgovernment employees wouldcause unrest and rioting. TheKRG may be facing or a deadend, were it seems impossibleto release government fundsfor paying unnecessary salarcries. Continuing with the currcrent situation is not a smartoption either, wasting all thatgovernment money paying fora huge unproductive publicsector is going to cripple theKurdish economy and lead itinto a fiscal storm.Recently, KRG announcedthe creation of 5,000 new“government” job opportunitcties, targeting the young joblcless graduates who are beccoming disillusioned with thegovernment and what the futcture holds for them in terms ofcareer. This type of initiativeis unfortunately not tacklingthe problem at the root as itonly serves to inflate the publclic sector with even more unwcwanted, non-producing publicemployees. Ironically what isneeded is a real welfare systemthat is a sort of a confession oracknowledgment there is unecemployment in Kurdistan, defcfining the unemployed personas just that, not giving thema fake public sector job thatis not needed and only compcplicates matters even more.Thankfully, some steps havealready been taken in that dircrection, the Ministry of Laborand Social Affairs has starteda project of providing welfarepayments of 150,000 Iraqi dincnars to graduates who haveproven that they cannot findemployment anywhere. Thesegraduates are then deemed offcficially unemployed.From there, it's easier to dealwith the unemployment problclem by channeling them to aone-stop shop. A procedurecan be set up where the officcially unemployed person goesthrough an employment centcter, which hasn't been createdyet. It's a much-needed areathat hasn't been thoroughly expcplored. The employment centcter can collate and gather jobinformation from the two sectctors and use that information tofind a job for the unemployedperson according qualificatctions, skills and preferences.Such a center has proven itsworth in many countries andis an efficient tool not in eradiccating unemployment compcpletely, but rather in makingsure that every job vacancyis filled. This is categoricallynot happening right now inthe Kurdish public and privatesector job market.In more advanced economcmies, a nanny state is avoidedby nourishing and encouragicing the private sector to hirepeople, pay them money andget them off the government'sback. Those countries wouldhave a sizable private sectctor that can absorb a workingpopulation, giving it jobs andmaking it productive or facebeing fired. The private sectorin any country is its economiclifeline; no country was bornwith a thriving private sectorthat came out of the blue. Rathecer it started off small and grewlarger, to the extent of havinggigantic multinationals in fullyfledged free market economieslike the U.S., for want of a bettcter example, were corporationsare a little less than a state in itscself like Microsoft corporationthat is hiring around 90,000employees.Can Kurdistan's privatesector face the challenge ofabsorbing hundreds of thouscsands of extra unproductivegovernment employees? Rightnow, the answer would mostdefinitely be in the negative.Although burgeoning entrepcpreneurial activity is startingto make an appearance, rightPRESS PHOTOnow it is not equipped or readyto deal with the serious hiddenunemployment problem Kurdicistan is facing. Given that theprivate sector of any countryneeds time to grow and developto be a realistic alternative tothe public sector as an employmcment base, the Kurdish privatesector needs a major steroidinjection from the governmentto make it strong enough toface the challenge. The succcessful Asian Tiger economieswere initially able to create agrowing private sector throughheavy state intervention thatsupported sizable manufacturicing industries.Is there another alternative?What did Adolf Hitler do todeal with Germany's postWorld War I gigantic unempcployment problem? For obviocous reasons, despite the manyreservations the writer hasabout using the Nazi Germanregime as an example, there issomething useful to learn fromthe way this dictator dealt withthe problem that Kurdistan isfacing at hand. Hitler boldlycreated huge national serviceprojects that required thouscsands upon thousands of laborecers, both skilled and unskilled.The sprawling Autobahns orsuper highways of Germanyare the outcome of Hitler'seconomic solution to Germancny's unemployment problem.What he gave the Germanpeople was a job and a natctional purpose that boosted theGerman people's morale. "Thebest possible way to bring theGerman people back into workis to set German economic lifeonce more in motion throughgreat monumental works,"said Hitler.Kurdistan is suffering fromhidden and cyclical unemploymcment, an undeniable fact thatneeds to be faced head on anddealt with — no half measuresand temporary fixes. Innovatctive daring steps are yet to betaken by the government todeal with this problem from thesource rather than just work ondamage limitation and quickfixes. History, German historyin this case, has something toteach us. Employment centersin Kurdistan can bring laborsupply and demand together.This will bring the Kurdisheconomy a step closer frombeing a petro dollar consumingeconomy to an efficient, prodcducing economy.