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French Version

Labor minister says war led to huge jump in number of unemployed

As many as 11,000 have filed for indemnity from the NSSF

Unemployment in Lebanon jumped alarmingly from 14 percent to 20 percent after the Israeli war in July, the labor minister said Friday.

"According to our estimates, unemployment is now close to 20 percent following the war that left many industrial plants and institutions either destroyed or damaged," Trad Hamadeh told The Daily Star.

The 34-day war dealt a severe blow to the economy which had started to enjoy some growth until June of this year.

It is hard to estimate the number of people who lost their jobs as a result of the war, with some sources claiming 11,000 have filed for indemnity from the National Social Security Fund (NSSF), a figure disputed by senior officials from the fund.

"I know for sure thousands of people were laid off during and after the war but I don't think this figure has reached the 11,000 mark," Hamadeh said.

He added that there is no official census department at his ministry or any other ministry to determine the number of unemployed in Lebanon.

"We usually take our information from the industrialists, the NSSF and the Central Bank. Imagine we have one person only at the census department."

Fadi Abboud, president of the Lebanese Industrialists Association, said 4,200 laborers lost their jobs when the factories they worked in were hit by the Israelis during the war.

He added that nearly 142 industrial plants that employ thousands of people were badly damaged during the war.

"These workers who lost their jobs have no where to go and regrettably the government is doing nothing to solve this problem," Abboud said.

Apart from the damaged factories and institutions, several five-star hotels such as Phoenicia Intercontinental Hotel laid off their employees after their business dropped by over 70 percent during and after the war.

More than 35 percent of those who lost their jobs are from the tourism and hotel sectors.

Many laid-off workers complain their employers did not even pay them their severance pay under the pretext that revenues fell sharply after the war.

Hamadeh warns of grave political and social consequences if the government fails to take any quick action.

"I have suggested the creation of a special fund to help those who lost their jobs due to the war but the Cabinet is still studying my proposal."

The minister said the fund needs less than $30 million to help the unemployed and until they find suitable jobs or return to their original jobs once the factories are repaired.

"The government seems to be more interested in helping the employers and not the employees," Hamadeh said, adding that under the law, companies that lay off their workers must pay them full indemnity.

"There is no excuse for any company or hotel to act this way if no direct damages to their premises occur."

Mohammad Kirki, the director general of the NSSF, said the fund does not have the exact figures of unemployment but believes that the number is much higher after the war.

"The early end-of-service benefits have been on the rise since 2002 due to the economic stagnation," Kirki said.

"The early-end-of service applications reached 51 percent in 2002, 57 percent in 2003 and 63 percent in 2004. I think the figures for 2005 and 2006 are probably much higher."

He said those who are forced to retire early will lose between 25 percent to 50 percent of their original compensation plan.

Only employees who serve 20 years or more in a firm and are covered by the NSSF are entitled for 100 percent of their salaries.

Karki said the end of service department of the NSSF is flush with money.

"The End of Service department has LL4 trillion ($2.6 billion) at its disposal," Karki said, adding that the NSSF does not have a special fund for those who lose their jobs due to unusual situations such as war.

Economists say that many Lebanese youths are forced to take trivial jobs if they are unable to emigrate.

The government has promised to raise more money during the next donor conference in Paris to revitalize the economy and the private sector.

Beirut 21-10-2006
Osama Habib
The Daily Star

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