Eight months of war in the Gaza Strip have caused loss of jobs and livelihoods on a massive scale and a sharp decline in GDP in the Occupied Palestinian Territory (OPT), a new brief by the ILO and the Palestinian Central Bureau of Statistics (PCBS) reports.

Since hostilities erupted in October 2023, the unemployment rate in the Gaza Strip has reached a staggering 79.1 per cent. In the West Bank, which has also been severely impacted by the crisis, unemployment has reached 32 per cent.

These figures bring the average rate of unemployment to 50.8 per cent across the two areas of the OPT. Unemployment rates and figures, however, do not account for those who have left the labour force altogether as job prospects proved unattainable. The actual number of those who have lost their jobs is therefore even higher than what the unemployment figures suggest.

Additionally, real GDP has contracted by an astounding 83.5 per cent in the Gaza Strip and by 22.7 in the West Bank over the past eight months, and real GDP of
the entire OPT has shrunk by an average of 32.8 per cent.

The new findings are presented in the fourth of a series of bulletins outlining the impact of the war in Gaza on the labour market and on livelihoods in the OPT.

‘Our new bulletin shows that the grim toll the war in the Gaza Strip has taken on human lives, and the desperate humanitarian situation it has caused, are accompanied by widespread devastation of economic activities and livelihoods. This compounds the suffering of Palestinians in the Gaza Strip and the West Bank and further endangers their safety and wellbeing,’ said ILO Regional Director for Arab States Ruba Jaradat.

The severe economic crisis now affecting the OPT has particularly impacted the private sector, the bulletin reports.

In the Gaza Strip, almost all private sector establishments have either completely ceased or significantly reduced production, with the sector losing 85.8 per cent of its production value – equivalent to USD $810 million – during the first four months of the wa
r. In the West Bank, the private sector suffered a 27 per cent reduction in production value equivalent to USD $1.5 billion during the same period.

This translates into daily private sector production losses equivalent to USD $19 million across the entire OPT during the first four months of the conflict.

‘Restoring people’s livelihoods and creating decent jobs is vital to enabling Palestinians in the Occupied Palestinian Territory to recover from the horrors the war has inflicted on them,’ Jaradat said. ‘This recovery work must take place alongside the ongoing humanitarian response, and the ILO and its constituents and partners are implementing an Emergency Response Plan to this end,’ she added.

The fourth bulletin further offers projections on the impact of the war on the OPT economy and labour market for the entire year of 2024. If the war was to end in August 2024 and economic and labour market recovery efforts follow, then the annual unemployment rate for 2024 is expected to average 47.1 per cent.

The
projections also suggest that, under such a scenario, real GDP would plummet by 16.1 per cent and real per capita income by 18.0 per cent in 2024 in comparison to 2023. These figures would represent the most pronounced decline in growth rates for both indicators in over two decades.

The new bulletin also takes a close look at the impact of the war in Gaza on workers and employers in the West Bank, where closures by Israel, movement restrictions and settler attacks have disrupted supply chain networks and transportation routes.

A survey conducted by the ILO in partnership with the Palestinian General Federation of Trade Unions (PGFTU) found that, among West Bank workers who are still employed, 51 per cent faced reduced hours of work and 62.8 per cent experienced a reduction in wages.

A second survey conducted by the ILO and the Federation of Palestinian Chambers of Commerce, Industry, and Agriculture (FPCCIA) found that 65.3 per cent of West Bank enterprises reported a reduction in their workforce, with man
y resorting to permanent or temporary layoffs.

Source: National news agency – Lebanon