The repercussions of the collapse of the Palestinian labor market extend beyond the Palestinian territories, highlighting the importance for Jordan of strengthening economic and regional cooperation, expanding employment opportunities, and supporting small businesses and agriculture amid reconstruction needs estimated at billions of dollars, according to a recent document by the International Labour Organization (ILO).
The document, issued on the 19th of this month, revealed the scale of the damage inflicted on the Palestinian economy. Gaza lost more than 252,000 jobs between the third quarter of 2023 and the third quarter of last year, while unemployment rose to 85.1%, compared with 45.1% before the war. Cumulative losses in labor income reached $2.8 billion, reflecting the depth of the crisis facing households, businesses and productive capacity.
These developments are particularly important for Jordan given its geographic and economic ties to the region and the need to support recovery efforts that restore production and trade and create sustainable employment opportunities, rather than relying solely on short-term humanitarian assistance.
Recovery and reconstruction needs in Gaza are estimated at $71.4 billion, including $11.3 billion during the early recovery phase, covering the first eight months, and up to $15.4 billion during the short-term recovery phase, extending to 18 months.
According to the document, employment-related losses amounted to approximately $2.77 billion, while recovery needs specifically related to employment were estimated at $1.24 billion.
These figures highlight the scale of the challenge facing neighboring economies, including Jordan, in dealing with the consequences of a prolonged crisis and the need to coordinate international efforts and direct funding toward projects capable of restoring economic activity and creating jobs.
The ILO stresses that successful recovery cannot be measured solely by rebuilding infrastructure. It also requires restoring household incomes, revitalizing the private sector, supporting small and medium-sized enterprises, developing social protection systems, and ensuring workers’ rights and decent working conditions.
In a development linked to the regional dimension of the crisis, the ILO launched last March, with $566,600 in funding from the Japanese government, a project aimed at strengthening economic empowerment and resilience among vulnerable households in Jericho and the Jordan Valley.
The project seeks to support small farming households through productive assistance, skills training and improved access to markets, with a particular focus on women and young people.
A rapid needs assessment identified the main challenges facing farmers, while 50 farmers are receiving specialized technical training. Activities also include the rehabilitation of agricultural infrastructure, which is expected to provide short-term employment opportunities.
This approach represents a model for linking assistance to productive development, potentially opening the way for regional exchanges of expertise in agriculture, productivity enhancement, supply-chain development and strengthening the ability of rural households to generate income.
Jordan’s role in the document was not limited to geographic proximity. The ILO also referred to regional exchanges of expertise, including workshops in Amman and Catalonia focusing on statistics and data-driven policymaking, integrated employment services, and mechanisms for reaching young people who are not in employment, education or training.
These issues are particularly important in the region, where improving youth employment opportunities requires moving beyond general training programs toward policies more closely aligned with labor-market needs and the skills sought by employers.
In the West Bank, the unemployment rate stood at 27.9% in the second quarter of this year, while female labor-force participation reached 17.9%, compared with 71% for men. In Gaza, youth unemployment last year reached 94% among young women and 81.3% among young men.
These indicators show that the employment crisis is not limited to the number of jobs lost. It also involves low female participation, disrupted transitions from education to employment, and declining job quality.
As part of the response, the United Nations launched the “Horizon Fund” last April to coordinate financing for early and medium-term recovery in the Palestinian territories, with a primary focus on Gaza. The fund covers early recovery, support for small and medium-sized enterprises, investment incentives, and institutional and governance development.
The “Gaza Team” initiative was also launched with initial funding of approximately €884 million to coordinate international interventions supporting early recovery.
At the same time, the ILO is implementing the Decent Work and Recovery Programme for the Palestinian territories for 2026–2029. The program focuses on restoring livelihoods, revitalizing businesses, developing skills, strengthening social protection, and promoting dialogue among the parties involved in the labor market.
For Jordan, these efforts are important in supporting regional economic stability, expanding opportunities for development cooperation, and exchanging expertise in employment, training and agriculture. Turning these opportunities into tangible economic gains, however, will require specific projects, sustainable financing and institutional coordination to ensure that reconstruction leads to productive jobs and stable incomes rather than a temporary recovery that quickly fades.
Source: Al-Ghad
