sharek - step forward white paper - youth employment

8/8/2019 Sharek - STEP FORWARD White Paper - Youth Employment

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Palestinian Youth Employment Action Plan

a White Paper prepared by STEP FORWARD and Sharek Youth Forum

August 2009


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Foreword

For the youth of Palestine, employment is both a greater challenge and a greateropportunity than in the past. The Palestinian economy cannot provide sufficient work for

all the young people growing up and leaving education every day. Their education itselfdoes not prepare them for real work. Their chances to make their own opportunitiesthrough enterprise are stifled. Young women face all of these and additional challenges.Yet we have the opportunity today, perhaps like at no time in the past, to create effectivesolutions to these problems.

Sharek Youth Forum puts forward this white paper boldly, yet humbly. Boldly stating whatwe see are the problems faced by young people seeking employment. Humblyacknowledging our limitations. We cannot guarantee that all of the problems and all of thesolutions are addressed in this White Paper. In fact we can guarantee they are not. Weare aware that we will have made mistakes. We are not prepared, however, to let the

situation continue as it is and we hope that this report creates a new impetus for acollective effort to solve the problems outlined.

With this, then, we open the debate and invite our friends and colleagues from youthorganisations, institutions and the private sector in Palestine and abroad to join us inseeking the necessary resolutions.

Sufian MushashaGeneral Secretary


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Background

As a follow-up to the millennium declaration, the UN General Assembly adopted, inDecember 2002, a resolution entitled Promoting Youth Employment. The resolutionencourages Members States to prepare national reviews and action plans on youth

employment and to involve youth organisations and young people. While the PalestinianNational Authority (PNA) is not a state, it is recognised as the representative of thePalestinian people, including the youth, and has committed to the Millennium DevelopmentGoals. This white paper looks, therefore, to the PNA for leadership in following therecommendations of this resolution by developing and implementing a policy.

In the 2002 resolution, the international community recognised that Governments haveprimary responsibility to educate young women and men, to ensure equal access to allyouth living in their country and to create an enabling environment that will promote youthemployment.

It is also acknowledged, however, that governments alone cannot be expected to addresstheses important issues. In particular in the Palestinian context, where the PA is unable toexercise full control over the economy. Youth organisations, employers' and workers'organisations, chambers of commerce, non-governmental organisations, community-based organisations and other civil society institutions have a key role to play in helpingthe PA to achieve these objectives. Meanwhile the occupying state has an additional roleto play in removing the barriers and restrictions to trade which severely constraineconomic capacity.

Sharek's STEP FORWARD Youth Business and Employment Service is instigating theprocess of the development of an action plan in order to give every young Palestinian the

opportunity to participate fully in the economy. Achieving this is a precursor to the creationof responsible, experienced leaders, a flourishing economy and resilience to externalshocks. Step Forward is not about defining the strategies or writing the plan but aboutstimulating the conversation, voicing the opinion of the youth and driving the participantstowards the outcome: a comprehensive plan which is implemented in full.

Objectives of this White Paper

Identify the main challenges, demonstrate the need for action and prompt anextensive review of the existing responses

Provide a voice for youth on the issue of economic participation

Recommend policies and actions

Set priorities and focus stakeholders on the core issues

Generate an accountability tool for youth

Stimulate the harmonisation and coordination of related actions

Provide a platform for sharing good practices

Advocate for mainstreaming of youth employment as an issue throughout local andnational institutions


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The Youth Employment Challenge

The problem, put simply, is an insufficient number of quality jobs. The core of the problemcan be summarised as poor economic performance combined with high population growth.Gender inequality then leads to an uneven distribution of quality jobs between men and

women. For youth in particular, there are additional problems relating to enterprise andeducation and training that exacerbate the challenge for them. The lack of employmentopportunities for youth has a spiral effect, dragging the poor into ever deeper poverty anddriving migration of the best educated and highest skilled. Finally, the lack of a wellfunctioning system of institutions means these problems, among others, remain unsolvedand often exaggerated.

The picture as a whole is not hopeless. On the contrary, there are many strengths andnotable achievements of the past years. Key problems remain unaddressed. Key hurdlesare avoided. The current approach to youth employment is fragmented and poorlytargeted. This white paper is aimed at prompting and promoting the discussions which will

provide the solutions the youth need.

The following snapshot of the 5 central problems and their contributing factors provides abrief insight into the problems referred to throughout this paper. Where relevant,references have been provided to backup the statements and to provide routes toextended understanding of the issues. The upcoming report "The Status of the Youth inPalestine"1 will provide a more detailed consideration of these factors.

1To be published by Sharek Youth Forum, 2009


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1. Poor Economic PerformancePoor economic performance alone does not necessarily create a problem foremployment. If the population growth rate exceeds economic growth rates, however,as it does in the oPt, insufficient new jobs are created to absorb the new entrants tothe job market the youth. Many problems described below are shared with alllabour-market participants. This merely re-emphasises the importance of addressing

them, not just for the youth but for the entire population. Finally, while this is not theplace for an in-depth economic analysis, the following factors play a big role in limitingeconomic growth and are briefly explored with an eye on youth.

Contributing Factors

1.1 OccupationThe occupation is the principal source of most of the economic problems thatcurrently plague the Palestinian economy. The economic structure isprecipitated by the prior and to an extent current dependence on work inIsrael combined with the prevalence of aid to support the country as it is in

limbo between occupation and self-rule. The lack of access to markets ispartly a consequence of movement restrictions and partly of non-tariffbarriers. These problems have knock-on effects as described below.

1.2 Economic StructureThe Palestinian economy is naturally small due to the population size. Itsstructural weaknesses lie in the lack of the diversity and the lack of a labour-intensive industrial base to absorb large numbers of new labour-marketentrants.

Economic Activity by Sector (% of Workforce, 2006)

Services & Other

Branches

36%

Transportation,

Storage &

Communication

6%

Commerce, Hotels

& Restaurants

19%

Construction

11%

Mining, Quarrying

& Manufacturing

12%

Agriculture,

Hunting, Forestry &

Fishing

16%

Source: Adapted from "Palestine in Figures", 20071, PCBS, 2009


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Economic Activity by Sector (Number of Establishments, 2006)

Industry

14%

Services activities

(profit and non-profit)

22%Wholesale, retail

trade & repairs

61%

Financial

Intermediation

1%Construction

1%

Transport, s torage &

communications

1%

It is also important to note that while 14,508 industrial enterprises exist, atotal of only 61,690 people work in these establishments, an average of 4.25employees per establishment2. This indicates a large number of smallworkshops and micro-factories form the industrial base, providing little roomfor job-creation. The causes of these problems are covered by factors 1.3 to1.9. The consequence is that the economy is simply unable to absorb thegrowing numbers of young people. The structural weaknesses then reinforce

the other factors in a downwards spiral of dependence, underinvestment andstunted growth.

1.3 Dependency on foreign aidOfficial assistance was $1,868 million USD in 2007, an increase of 193%since 20003. This income from abroad does not represent any product orservice and thus rarely represents sustainable or growing economic activity.It maintains high prices and high wages and of course is necessary to relievepoverty and human-rights abuses in the short run. The funds underminenormal economic activity and through this unsustainable dependencyinevitably lead to real harm.

1.4 Lack of access to marketsThis factor works on two levels: national and international. On the nationallevel markets are made inaccessible by security restrictions imposed by theoccupation and consumer preference for imports. The latter also highlightsthe poor quality (perceived or actual) of Palestinian products and in particularthe poor marketing and packaging used compared to the imports (mostlyIsraeli but also Turkish and Chinese). International markets are made

2 Calculations from PCBS Annual Statistics 2007, http://www.pcbs.gov.ps/Portals/_pcbs/Industry/detailed%20tab%201.htm (accessed 14/07/2009), PCBS, 20073 World Bank Data Profile, http://ddp-ext.worldbank.org/ext/ddpreports/ViewSharedReport?REPORT_ID=9147&REQUEST_TYPE=VIEWADVANCED (accessed14/07/2009), World Bank

Source: Adapted from "Palestine in Figures", 20071, PCBS, 2009


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inaccessible through a mixture of foreign import regulations4 including Israelior Jordanian registration, extensive border-checks despite the customs unionwith Israel, technological requirements, cost5 and non-tariff barriers. Withbusinesses unable to access important markets, the private sector is stifledand unable to provide the necessary employment opportunities for youth.

1.5 UnderinvestmentA Palestinian manufacturer will not invest in higher quality, advancedtechnology and general expansion of production given the uncertainties ofoccupation (see 1.1) and the lack of access to markets (see 1.4). Withoutsuch investment, however, the private sector will never grow sufficiently largeto employ the new entrants to the labour market. Meanwhile, with thePalestinian Authority holding limited jurisdiction across the territory,investments in infrastructure are neglected that would otherwise support theprivate sector. Without a strong, sustainable private sector which attractsand generates investment, providing sufficient employment for the growingyouth is not possible.

1.6 Technological DevelopmentInevitable technological advances lead to the substitution of manual formachine-labour. Meanwhile, a technologically developed economy willcreate more high quality jobs and new opportunities. All countries face thiscomplex problem and several considerations are important in addressing it.For the oPt, the situation is, as ever, exacerbated by occupation: puttingaside all other factors, many advanced technologies are restricted by theoccupier (see 1.7). The economic structure (see 1.2) which favours smallindustrial units and service sector activity, particularly for youth, does not lenditself easily to costly technological development. Competition from imports

(see 3.11) makes technological advances important given that China has aclear wage-advantage. Meanwhile, a lack of access to markets (see 1.4)makes it difficult to generate a viable return from technically advancedproducts and services. In short, this factor is both a threat and an opportunityto unemployed youth.

1.7 Import restrictionsThis factor is a knock-on problem caused by the occupation anddisproportionately affects the Gaza Strip. Manufactured products require amajority of their raw materials to be imported. The occupation imposesrestrictions on a large number of imports at the behest of security. A PCBS

survey indicates that 41.3% of businesses experienced major problemsimporting raw materials as a result of Israeli measures in 20056. Anecdotalreports indicate that imports of technically advanced machinery are oftenrestricted for security reasons while even simple raw materials for cleaningproducts or simple building materials such as cement are restricted in Gaza.Although the Gaza smuggling tunnels do facilitate imports, Israeli actionshinder these routes and add to the cost. Without a consistent ability to import

4 "55.0% of the respondent [to the survey] indicated that the import regulation in the foreign markets hindered the export process","Main findings of the Survey of the Perceptions of the Owners/Managers of Industries Regarding the Economic Situation", p. 3, PCBS,

December 20075 "70.7% of the owners/ managers of the industrial establishments identified the impact of Cost of transportation on production cost",ibid, p. 16 "Survey on the Perception of the Owners/Managers of the Industrial Establishments Towards the Economic Conditions", PCBS,February 2005, www.pcbs.gov.ps/Portals/_pcbs/PressRelease/Econ_Feb05E.pdf (accessed 15/07/2009)


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raw materials, industry and the private sector cannot expect to grow, makingjob-creation slow or impossible in the private sector.

1.8 Land seizureWith regard to agriculture and mining as sources of economic prosperity, theproportion of the West Bank explicitly or severely restricted for Palestinian

use is 38.3%7

. The parts of this area that are also some of the mostproductive, both with respect to agriculture and natural resources8. In short,the inability to develop natural resources based in Area C further stunts thegrowth of the private sector in the oPt. Both agriculture and mining arelabour-intensive and offer excellent import substitution and exportopportunities. Without these opportunities the possibility of creating sufficientjobs for the growing youth labour-force is very small.

1.9 Cost of livingTypicalcauses of inflation in the oPt are: the trade deficit, which subjects theeconomy to imported inflation; the lack of a domestic currency and

consequent lack of control over monetary policy; and the influx of foreign aidand remittances, causing increases in the purchasing power of a limitednumber of individuals. As the cost of living rises and incomes decline andunemployment increases, the difficulties faced by all employing organisationsare heightened. As a result the opportunity to create jobs for the expandinglabour-force is further limited.

Consumer Price Index

150

152

154

156

158

160

162

164

166

Dec.2

006

Jan.

2007

Feb.2

007

Mar.2007

Apr.2007

May.2

007

June.2

007

July.2

007

Aug.2

007

Sep.2

007

Oct.2007

Nov.2

007

Dec.2

007

Month

Index(1996=100)

Source: Adapted from Monthly Consumer Price Index Numbers, 2009

9, PCBS

7 "The Economic Effects of Restricted Access to Land in the West Bank", World Bank, 2008, p.78 The value of seized land: "Some 170,000 dunums [(17,000km2)] of fertile agricultural lands are affected, or 10.2% of the total areacultivated in the West Bank, with an average economic value of US $38 million equal to roughly 8% of Palestinian agriculture product",ibid, p. 239 Adapted from Monthly Consumer Price Index Numbers,http://www.pcbs.gov.ps/Portals/_pcbs/cpi/551ee164-91d4-436e-b789-1535eca17163.htm (accessed15/07/2009), 2009, PCBS


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1.10 Skills and TrainingSpecifically focusing on small and medium sized enterprises (SMEs), thetechnical capacity to employ more people is rarely present. Managers andowners who intuitively have these capacities will succeed in growing theirbusinesses, while those who do not will remain small. Given the economicstructure (see 1.2), it is clear that most businesses in the oPt remain small.

The indication is, therefore, that businesses are missing opportunities to growand therefore increase employment.

2. Gender InequalityThe inequality of opportunity between young men and women creates an imbalancedsociety. In the oPt, traditional roles often exclude women from the labour market theeffect of which is disproportionately large on young women.


2.1 Traditional roles and attitudes

The traditions in the oPt require women to behave in very particular ways.The attitudes towards women are often severely affected by the perceptionscreated by the traditions. Young women restrict themselves: such is thestrength of the traditions and attitudes, that 65% of young women oppose awoman president10. The result is that women do not pursue particular rolesor are hindered in their application. Finally, this limit to the available work forwomen keeps unemployment of women high and wages low compared tomen.

Total Employees by Age Group and Gender

0

25

50

75

100

125

150

175

200

15-24 25-34 35-44 45-54 55+

Age Group

NumberofEmployees(1,0

00s)

Women Men

Source: Adapted from Labour Market Statistics, 200911

, PCBS

2.2 Ineffective enforcement of legislation (Article 25)While the equal rights of women to work are enshrined in the legislativeframework12, the facts show that only 11% of employed individuals arewomen and women face consistently lower wages11. This inequality dis-

10 "The Youth Talk: Perceptions of the Palestinian youth on their living conditions", Sharek Youth Forum, 2008, p. 2911 Adapted from Labour Market Statistics, http://www.pcbs.gov.ps/_pcbs/labor/lab_cens_lab_c5.aspx(accessed 15/07/2009), 2009, PCBS12 The Palestinian Basic Law, Article 25, 2003, http://www.palestinianbasiclaw.org/2003-amended-basic-law (accessed 15/07/2009)


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empowers women economically and points to an inability of the authorities toenforce the non-discrimination legislation in place. Women acquireproportionately more education than men, yet they remain excluded from thelabour market13. Finally, given that only 2% of employees are young womenaged 15-24, while 24% are young men aged 15-24 and that the averagepercentage of employees who are female is 11%11, it is evident that women

are not simply under-represented generally, but also that youngwomen aredisproportionately under-represented compared to the average for women.

Average Daily Wages (in NIS) for Wage Employees

0

25

50

75

100

2000 2001 2002 2003 2004 2005 2006 2007 2008

Year

AverageDailyWage(NIS

Male Female

Source: Adapted from Labour Market Statistics, 2009

14, PCBS

2.3 Opacity of the role of women and underemploymentWhen a young man is unemployed, he will often spend his time walking withfriends or watching the world pass by standing beside the street. When ayoung women is unemployed, she stays at home, perhaps engaged in child-care for a relative or domestic chores. Women also marry on average 5years earlier than men15. Both cases contribute to the problem of youthunemployment, but the latter is hidden and opaque. As a consequence,those responsible for addressing unemployment are more likely to respond tothe needs of the young men, whose situations are obvious and who are more

accessible as target groups. With specific reference to underemployment,the PCBS reports that women work on average 6 hours 10 minutes, whilemen work on average 7 hours 24 minutes per day16.

3. Exclusion from Entrepreneurial OpportunityIn almost all economies, small enterprises employ the vast majority of individuals. Theyouth in the oPt are largely excluded from entrepreneurial opportunities despite the

13 "The overall rate of female enrolment in secondary education amounted to 75.7%, in comparison with 67.6% for males. Femalesconstitute half the number of students enrolled in universities, as the rate of enrolment in higher education was 107 females for every100 males in 2004-2005.", "Women in the Palestinian Labour Market",

http://www.pwrdc.ps/PDF/Palestinian%20Women%20and%20the%20Labor%20Market.pdf (accessed 15/07/2009), PWRDC, 200914 Adapted from Labour Market Statistics, http://www.pcbs.gov.ps/DesktopDefault.aspx?tabID=4112&lang=en (accessed 15/07/2009), 200914, PCBS15 In 2000, the median age for marriage for women was 19.0 and for men 24.1. From Population Statistics,http://www.pcbs.gov.ps/Portals/_pcbs/child/demogrph.aspx (accessed 26/07/2009), PCBS16From Gender-focused Statistics, http://www.pcbs.gov.ps/Portals/_pcbs/gender/tim1.htm (accessed 19/07/2009), 2007, PCBS


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fact that these offer the most interesting and beneficial options to them. Meanwhileentrepreneurial opportunities are not easily exploited as the West Bank and Gaza Stripare ranked 172 out of 181 in the world for ease of starting a businessby the WorldBank17.

Contributing Factors & Barriers to Entry

3.1 OccupationThe occupation is the central barrier for new businesses being started. In theGaza Strip, in particular, the occupation prevents viable small businessesfrom starting up by making procurement of materials and machinery almostimpossible. In the West Bank, such resources are available but the tradingpotential is limited and the economic decline caused by the fragmentationand security restrictions hinder the progress of start-up businesses. Finally,for young people in particular, travelling around for any reason is at best slowand unpredictable. At worst, it is impossible.

3.2 Economic performance and structureAn economy in decline, dependent on aid, stifled from the outside andbetween urban centres, Palestine is a difficult place to start a business andmake a living. For the youth in particular, an economy focused on services(including government and NGO-provided ones) is restrictive and difficult toenter. Problem 1 (poor economic performance) describes the host ofproblems in the Palestinian economy. For young entrepreneurs, all of thesebecome problems directly and disproportionately affecting them.

3.3 Lack of affordable business development servicesThe youth, perhaps more than other groups, need support services to get

their businesses started. They do not have experiences to draw on which willinform the way they operate. At present, only those who are naturally skilledentrepreneurs succeed in starting up their businesses. Support services thatare not provided in sufficient quantity or quality include finance (see section3.4), training (see also section 3.6), coaching, networking, marketing,research, innovation and legal services.

3.4 Lack of access to financeTo start a business, you need money. To access money you need collateral,contacts or proven experience. For the youth without other options who areconsidering entrepreneurship, therefore, the possibility of accessing finance

is almost zero. Even microfinance schemes are inaccessible due tocollateral (physical or social), group lending, or background requirements.For youth without the opportunity to borrow from family members, this putsan effective stranglehold on their ambitions. Finally, it is important to notepoint 1.9, the rising cost of living. This means that despite the economicdecline, the cost of starting a business is rising daily reaching 96.6% ofincome per capita in 200818. This creates an increasing number of youngpeople who cannot afford, even with savings or family support, to start abusiness. In short, financing (including microfinance) is not available orinsufficient to start a viable business for youth.

17 "Doing Business", http://www.doingbusiness.org/CustomQuery/(accessed 21/07/2009), World Bank, 200918 See graph below. The cost of starting a business as a percentage of income per capita was 96.6% in 2008. This compares to 0.7%for the USA, 4.4% for Israel. "Doing Business", http://www.doingbusiness.org/CustomQuery/(accessed 21/07/2009), World Bank, 2009


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Cost of Starting a Business in 2008

0.3 0.74.4 5.9 10.6

18.728.6

49.4

62.166.2

96.6

178.8

0

50

100

150

200

Ireland

UnitedStates

Israel

AverageOECD

Qatar

Italy

Egypt

AverageMENA

AverageWORLD

Jordan

WestBankand

Gaza Y

emen

Cost(%ofincomepercapita)

Source: "Doing Business", http://www.doingbusiness.org/CustomQuery/ (accessed 21/07/2009), World Bank, 2009

3.5 Lack of access to markets

Please see section 1.4. This factor contributes directly to the exclusion ofyoung people from entrepreneurial opportunities as well as to the generalproblem affecting existing businesses' ability to grow. With additionalreference to youth enterprise, the absence of local and adaptable marketinfrastructure is a significant barrier to the success of new entrepreneurs. Inparticular the limited routes to market, the expensive or poor qualityintermediary services and the poor quality or unaffordable marketing servicesavailable to new businesses.

3.6 Skills and trainingEntrepreneurial training and skills development opportunities proliferate with

the saturation of free service-provision by NGO projects. It is often the case,however, that this training does not lead to real changes and improvementsin operational capacity of young entrepreneurs. Meanwhile the groupstargeted by the these training programmes are often restricted. In particular,the provision of training to young children and teenagers in entrepreneurshipis poor.

3.7 Closed networksOne of the advantages of a strong business network is the mutual supportprovided and in particular, the purchase of products or services from withinthe network. Exactly this advantage also creates a barrier to entry for new

entrepreneurs. In the oPt, businesses are hierarchical and the heads of thebusinesses form a close, strong network that directs business to othermembers of the network. For a young person seeking to compete with these


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businesses, the task is made more difficult and in some cases impossible bythe prevalence of closed business networks.

3.8 Bureaucracy, legislation and regulationsThe World Bank's Doing Business report paints a picture of excessive red-tape in the West Bank and Gaza Strip. In 2008 it took 92 days to start a

business in the oPt. This compares to 33 days for the Middle East & NorthAfrica in general, 34 days in Israel and 6 days for the USA. Only 17countries have a slower business-start-up process. There are 12 proceduresrequired to start a business, compared to 2 in New Zealand. Only 29countries have more procedures19. For a youth, each of these barriers isexacerbated by their age and inexperience. The result is an environmentwhich makes it almost impossible to start-up unaided.

Comparison of Bureaucracy in 2008

(Time (days) and Number of Procedures to Start a Formal Business)

6 69

13 13 1415

33 34

43

63

92

0

25

50

75

100

Qatar

UnitedStates

Egypt

Ireland

Italy

Jordan

AverageOECD

AverageMENA

Israel

Average

WORLD

Yemen

WestBankand

Gaza

Time(da

ys)orNumberofProcedures Time (days)

Procedures (number)

Source: "Doing Business", http://www.doingbusiness.org/CustomQuery/ (accessed 21/07/2009), World Bank, 2009

3.9 Culture and attitudes

The burden of occupation has a profound effect on the attitudes of youth inthe oPt. The youth are always more optimistic than the average, but thereality of the conflict forms a powerful negative influence. The outcome isapathy and migration. Meanwhile, a culture of dependence has emerged outof necessity through international aid, remittances and the previously readylabour market in Israel. Anecdotal evidence also suggests that youths seekillegal work in Israel even when provided with excellent local opportunities20.The combined outcome is that youth expect to be helped and do not

19

"Doing Business", http://www.doingbusiness.org/CustomQuery/(accessed 21/07/2009), World Bank, 200920Anecdotal evidence collected by Sharek Youth Forum's Business Support Units during evaluation of a business start-up project givingfinancial support, training and business counselling suggested that youths given grants and training would still prefer to seek illegal workin Israel.


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necessarily try as hard as they might to create innovative businessesbecause they can always fall back to a dependent state.

3.10 Capital and technology intensityFor most youth, the biggest barrier to starting a business is the financial cost.The biggest cost-hurdles are invariably the capital (including machinery,

equipment, land and buildings) or the technology (including software,advanced machinery and specialised techniques). For youth, the demandsin almost all markets for uniform products, produced quickly and to acommon standard are insurmountable due to the inability to acquire thenecessary capital or technology. In short, the youth are unable to startbusinesses in a large number of markets and so are limited to labour-intensive industries or simple services (such as retailing). This severely limitstheir ability to innovate and restricts their profit-making potential.

3.11 CompetitionFor youth in the oPt, dominant competition comes from four sources: Israeli

imports, large local businesses with closed distribution networks, OECDimports and the rest of the world (including Turkey and China). The cost ofcompeting with any one of these groups makes it almost impossible withoutpersonal connections or funding. Remaining opportunities are, therefore,limited to completely innovative products or ultra-competitive service sectorniches such as grocery shops, mini-markets, micro-factories and agriculture.This is reflected in the economic structure (see 1.2) The latter is the mostcommon but also attracts the lowest margins and so prevents the youth fromgrowing their businesses sufficiently to enter a more profitable market.

4 . Education and Training

Without a supply of the right skills, businesses will continue to avoid employingPalestinians for particular roles. In contrast with many countries, the oPt continues toproduce young people that are, on paper, highly educated and well trained. Theproblem is not the quantity of education but the relevance and quality of education.


4.1 OccupationThe most disruptive element of the occupation with respect to education isthe security restrictions including movement restrictions. For a young personstudying at a university less than 1 hour away, perhaps in a village near

Nablus, the journey each day may involve long waits at checkpoints. Thismakes studying much harder than it needs to be. Meanwhile, the difficultiesfaced in travelling to other countries, combined with the lack of internationalexposure further hinders the quality of the education in the oPt. Finally, theoccupation makes life unpleasant and forces people to study abroad. If theydo return, these young people are better educated and more experienced.The same advantages of studying abroad are almost impossible to attain inthe oPt and as such those who cannot afford to are faced with even morelimited opportunities.

4.2 Gap between education and the labour market

Historically, the oPt had an excellent education system that has succeeded inproducing a skilled labour force. A skilled labour force, however, must havethe right skills to meet the needs of the economy in order for the young


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graduates to participate in the economy. In the oPt today, young people arebeing educated and trained to a high degree. In many cases, however, thefields they are studying are chosen because the teachers are available ratherthan because the economy needs them. There is a gap between educationand employment that causes young people to spend time and moneystudying that will not help them get a job.

4.3 Economic structureThe trend of the education system has followed that of countries developinghighly skilled workforces that meet the needs of a technologically advancedand complex-service oriented economy. In the oPt, the economy has notchanged structurally in the same way (see 1.2). As such, the education nolonger meets the needs of the economy. Fields such as NGO administration,the exceptions to the rule, are providing young people skilled in work which isfundamentally unsustainable and thus increasing the dependency on foreignaid. With the economic structure fixed into its current form and the educationsystem setup to meet another structure altogether, the likelihood of a young

person participating successfully in the economy is falling annually.

4.4 Over-academic coursesWhile related to points 4.2 and 4.3, it is sufficiently important to separate thisproblem which relates in a large part to the technical and vocationaleducation and training (TVET) sector. While the sector exists, it has verylimited capacity both in terms of quantity and quality. Meanwhile the courseslack the essential work-experience, apprenticeship and internshipopportunities that should characterise them as practical and direct routes intogainful employment.

4.5 CostThere are two central elements to the cost-challenge in the oPt. The first isthe cost of higher education. Many families can afford to pay tuition fees,while many cannot. While proposals for universal free higher education havebeen made, the cost are prohibitive and there is a clear need to counter thewidening inequality between rich and poor through education. The secondelement to the problem is the training and capacity building that dominatesNGO interventions. While training budgets and the resulting industry thatdepends on them are inflated, the cost to trainees is almost always zero.This creates a skewed incentive to attend training and a skewed market for itboth of which lead to low quality. Invariably, training has little or no long term

impact on the trainees despite the vast costs associated with it.

4.6 Expectations of youthYouth in 2009 see the world around them every day. 46% of youth havetravelled outside Palestine and 36% consider migrating externally21. Withcommunications technology widely available (including televisions, internetand mobile phones), the youth are exposed to a swathe of cultures offeringdifferent costs and benefits. They are, unlike in previous generations,presented with a picture of a life they don't see around them but they knowexists. This makes them impatient to have what they see youth in othercountries having. The difference between these desires and the real

21 "The Youth Talk: Perceptions of the Palestinian youth on their living conditions", Sharek Youth Forum, 2008, p. 56-57


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economic opportunities available in the oPt creates a problematic imbalancein expectations.

4.7 Infrastructure and InvestmentThe oPt suffers in the education sector as in others, from aging infrastructureand a lack of long-term investment. Meanwhile, the investment in teachers'

salaries has lagged behind the cost of living (see 1.9). Poor pay, leads topoor quality and demotivated teachers, which has precipitated the generalpoor employability of the youth. Given the difficulties faced in paying salariesof teachers, the possibility of investing in improved facilities, teachingequipment and technological advances is limited without private funding.

4.8 Lack of servicesIn particular, services bridging the gap between education and work (careersservices) are poor quality or non-existent22. These services are valuable inorder to ensure that job-applicants can properly communicate their suitabilityfor the job they are applying for. The absence of such services creates an

imbalance between those people who can and those who cannot accessthem. Youth who have studied abroad have a significant advantage in theoPt itself having had access to careers services. Meanwhile, for youthcompeting abroad, the likelihood of success is even more affected given thequality of services available to those they are competing with.

5 . Barriers created by the failures in the systemThe elements of society obligated to address social problems families, localgovernance structures, national governments, non-state actors are the source ofsolutions to the problems presented above. When they do not provide those solutions,however, they themselves become a barrier. If they acted according to their mandate

the problems outlined in this paper would be eliminated. These systemic barriers canalso be pre-requisites to a solution and while not directly affecting youth economicempowerment, still play an important role.

Contributing factors

5.1 OccupationWhile occupation is not the sole cause of any problem in the oPt, withrespect to Youth Employment and the economy in general, the occupation isthe most significant systemic barrier in place to a solution. Even when it

does not directly create a problem, the occupation is hindering a solution.Specifically, it illegally creates barriers to economic development includingsettlements, settlement infrastructure and the separation wall23. It uses thetools of occupation to create economic barriers, including checkpoints,security restrictions and the blockade of Gaza. Finally, it creates uncertaintyand dependency both of which stifle the private sector. Its removal wouldlead to significant self-generated improvements in the employment situationfor youth.

22 Supported by anecdotal evidence from Sharek Youth Forum's experience providing careers services in universities and Injaaz'sexperience providing careers services in secondary schools. Both are providing excellent services but are not able to offer sufficientcoverage for all young people.23 Settlements in occupied territory and any infrastructure created to serve those settlements are illegal according to InternationalHumanitarian Law to which Israel is a signatory. UN Security Council,Resolution 465, 1980


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5.2 Lack of a comprehensive national youth strategy and in particular anational youth employment strategyThe current document seeks to address directly this problem which until nowhas persisted. The lack of a coordinated strategy combined with the regulardonor-funded projects leads to duplication, poor targeting of beneficiaries andavoidance of the highest priority problems. If a comprehensive strategic

approach was adopted, many of the problems outlined in this paper wouldalready have been addressed.

5.3 Poor representation of the youth in politicsThe youth are under-represented politically. The minimum age formembership of the Palestinian Legislative Council (PLC) is 3024, while atpresent, the youngest member is 3125. This excludes more than one third26of the adult Palestinian population. While the situation is obvious on thenational level, youth are under-represented at all levels in the oPt fromcommunity service-providers to local government and private business, thereis always a lack of youth representing their needs to society. As a result,

policies and actions lack understanding of the real issues that youth face andthat concern them. Finally, this limits the ability of institutions to identifytackle the problems that face youth.

5.4 Lack of dedicated servicesWith the lack of a comprehensive policy, government (among other) servicesrarely focus on youth exclusively. In particular, it is the awkward positioningof responsibility for youth in national institutions that hinders society fromaddressing the key challenges outlined in this paper. For example youth iscommonly combined with sports and culture27 which undervalues theimportance of youth given the demographic situation28. The impact is that

problems are not often solved and the lack of a comprehensive youth policyis a clear consequence of these problems. Many problems are unique toyouth and without dedicated services and institutions, they will remainunsolved.

5.5 Competition among NGOsThe excess of donor funding in the oPt (see 1.3) has steadily encouraged aproliferation of NGOs providing services and assistance to the Palestinians.While these NGOs often perform a vital role in maintaining society andsupporting progress, they are poorly coordinated and regularly replicate eachothers' projects with small changes. Indeed most projects adopt the same

approach and rarely achieve a lasting, meaningful impact. Meanwhile, thereplication wastes resources and the competition leads to funds being splitwhich reduces their potential impact. In short, NGOs end up providingcompeting services without intention due to poor coordination and this in turnprevents some problems being addressed for lack of funds.

24 1995 Palestinian Elections Law, www.palestinianbasiclaw.org/downloads/1995-elections-law.pdf (accessed 26/07/2009)25 The youngest member is Moshir el-Masri, born 1978. "The Palestinian Legislative Council, A Handbook", The Washington Institute,http://www.washingtoninstitute.org/html/pdf/PLCHandbook.pdf (accessed 26/07/2009)26 Estimations from PCBS population statistics, PCBS, 200927 Youth was even combined with prisoners' affairs in the emergency cabinet in 2009(http://www.jpost.com/servlet/Satellite?pagename=JPost%2FJPArticle%2FShowFull&cid=1181813054710 , accessed 11/08/2009). Previous cabinets listed at theJerusalem Media and Communication Centre, http://www.jmcc.org/politics/pna/pagovfeb05.htm (accessed 11/08/2009).28 The youth comprised about 27% of the total population of whom 40% were adolescents (15-19) and 40% where 60% were youngpeople (20-29). "Palestine Youth: Figures and Statistics", Sharek Youth Forum et al, 2007, p. 1


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Recommendations

Introduction

It is with some hesitancy that STEP FORWARD and Sharek Youth Forum take on the vasttask of putting forward recommendations to address the host of problems identified above.

We are more than aware of the complexity of the task ahead but we face it with open eyesand open arms. We acknowledge our limitations in knowledge and capacity. We have nothowever, limited our ambition. We invite our colleagues in youth organisations, nationaland international NGOs, government ministries, national and international institutions andof course, the private sector to join us in setting out a clear action plan to take Palestinianyouth forward. So, although we may have made mistakes, we hope that by beginning thediscussion and continuing it together, we will reach the right conclusion.

Structure

The section broadly reflects the problem analysis and the identifying numbers (such as 1.4

or 3.2) match up. The problem analysis is both an overview of the situation and areference to inform the discussions on the recommendations. Where factors are omittedfrom the recommendations section, it indicates that no recommendations have beensuggested. For example, with reference to occupation, no recommendations have beenmade since only the end of the occupation will solve the problem and this goes beyond thescope of this white paper.

Each factor is taken in turn. A rough estimate is given regarding the possible cost (where1 is almost without cost and 10 is in excess of millions of dollars) and the time (where 1 isalmost instant and 10 is on the 3-5 year timescale). Pre-requisite factors are thosenecessary to be solved prior to the implementation of the recommendations given.

Dependent factors, on the other hand, are those which depend on the implementation ofthe recommendations connected with the factor under consideration. The numbers matchthose of factors listed in the problem analysis.

Recommendations are sorted by general responsibility for their implementation.Government recommendations include those for ministries, schools, the executive,legislature and the judiciary. The civil society recommendations are aimed principally atyouth organisations but also at other Palestinian NGOs and community organisations.The private sector includes profit-making companies and private institutions. Finally, theinternational column refers to international NGOs, foreign governments, bilateral andmultilateral donors and international institutions.

These points are summarised in Appendix 1.


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Problem 1 Poor Economic Performance

1.1 -Occupation

No recommendations

Cost Band Time Band Pre-requisite Factors

9 9 1.1, 1.6, 1.8, 2.1

Government Youth Organisations Private Sector

Conduct major macro-economic review and seek

methods of increasing thelabour-market absorbtioncapacity

Establish work-abroadprogramme

Conduct regular labourmarket assessments

including migration andadvocate for governmentaction on increasing thelabour-market absorbtioncapacity

1.2 - Economic

Structure

Adopt a labour-intensiveapproach to investment

Develop sustainable localemployment programmes

Respond positivelygovernment and NGrecommendations olabour-marketabsorbtion capacitybuilding measures


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7 7 5.2, 5.5

Government Youth Organisations Private Sector 1.3 -Dependency

on foreign aid Focus on sustainability ofinstitutions and adoptstrategies recommended tosubstitue foreign aid forgovernment-generatedrevenue

Review funding strategiesand create timelines for thefinal substitution of aid forgovernment- and self-generated revenue

Support governmenrevenue raisingmeasures and provvoluntary commitm


3 7 1.1, 1.2, 1.8

Government Youth Organisations Private Sector 1.4 - Lack ofaccess tomarkets

Revisit the Paris Protocol andimplement recommendations

Provide extensiveunderstanding (includingrecommendations togovernment and the privatesector) of the features andimpacts of lack of access to

markets

Adopt strategies foimproving perceptioof Palestinian produand accessing locaand internationalmarkets


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10 3 1.1, 1.2, 1.3, 1.4, 1.7, 1.10, 5.5


1.5 - Under-investment

Support and improve thePalestinian InvestmentPromotion Agency (PIPA)

Advocate for and improveexisting private sectorinvestment mechanisms

Prioritise investmen

1.6 -TechnologicalDevelopment

No recommendations

1.7 - Importrestrictions

No recommendations


1 7 1.1


1.8 - Landseizure

Research and implementmeasures to develop despitethe lack of access to land

Capacity building for legalchallenges to land seizure


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7 5 1.1, 1.2, 1.3


1.9 - Cost ofliving

Research and address thesupply-side causes ofinflation

Research and implementstrategies to avoid creatinginflation with foreign aid

Investment inefficiency measurecut costs


5 2


1.10 - Skills

and Training

Provide incentives for privatebusinesses to invest in skillsand training

Capacity building in privatesector

Invest in skills andtraining


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Problem 2 Gender Inequality


4 9 2.3


Establish innovative non-traditional employment andself-employment programmefor young women

Conduct baseline survey onattitudes towards women innon-traditional roles

Adopt positivediscrimination policfor non-traditional r

Incorporate best practicesinto government employmentpractice

Create financing productsspecifically targetted at youngwomen.

Provide internship awork-experienceprogrammes for yowomen in non-traditional roles

Support the promotion ofnon-traditional roles to youngwomen

Provide additional training foryoung women

Training for teachers tochange attitudes

Develop acceptance ofchanging roles

2.1 -Traditionalroles andattitudes

Review educational curriculaand materials

Provide gender-specificcareer guidance

Develop a Gender-Sensitive Employer

brand


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6 2 5.1, 5.2, 5.5


Incorporate best practicesinto government employmentpractice

Empower workers' rightsorganisations to monitor andsupport enforcement

Review curricula with respectto gender-sensitivity

Build awareness in thecommunity of rights andobligations

Public ranking ofcompanies' adhereto legislation

Coordination betweenministries responsible for

youth and women

Introduce clear penalties forbreaking this law

2.2 -Ineffectiveenforcement oflegislation(Article 25)

Mainstream gender-sensitiveeducation

Provide legal aid for femaleworkers

Public ranking forcompanies adherento the legislation


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6 5 5.2, 5.3


Establish two-wayemployment promotionservice

Strengthen women'sbusiness networks

Organise forums forunemployed young women

Tracking graduates to identifyongoing needs

2.3 - Opacity ofthe role ofwomen andunderemployment

Review the classification ofunemployment statistics

Use community networks toidentify young women whowould like to work


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Problem 3 Exclusion from Entrepreneurial Opportunity

3.1 -Occupation

No recommendations


9 9 1.2, 3.1


Create incentives forsustainable youthemployment in emergingsectors

Document realentrepreneurial experiences

Wide-reaching macro-economic policy review

3.2 - Economicperformanceand structure

Subsidise youthentrepreneurs in keyindustries

Regular youth-focusedmarket assessment bystudent volunteers

Study good practicefrom similar busineenvironments


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6 5 5.3, 5.4, 5.5


Oversee the merging ofduplicated services

Conduct in depth assessmentof capacity of existingservices

Invest in services tocompete with NGOsector

Undertake review of neededservices and which services

should be free or privatised

Provide support forprivatised, youth focusedbusiness development

services

Provide quality,affordable and youtfocused BusinessDevelopment Servi

including businesscounselling, incubaand training

3.3 - Lack ofaffordablebusinessdevelopmentservices

Effective guidance of youthtowards high potential sectors

Effective guidance of youthtowards high potential sectors

Increase socialresponsibility activitand refocus towardprovision of BusineDevelopment Servi


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8 4 3.3, 3.6, 3.7, 3.8, 3.9, 5.2, 5.4


Establish a Youth Enterprisefund

Sharing of youth-specificgood practices between MFIs

Develop commerciacredit rating system

Facilitate microfinanceschemes

Encourage person-to-person(P2P) lending

Develop youth-specredit financingproducts

Ease regulationsCreation of innovativefinancing schemes for youthbusiness

Introduce compulsoryfinancial education in schools

Provide youth specificprogrammes to supportaccess to micro- andcommercial-finance

Creation of a fund f

youth to launchinnovative business


4 3 1.4, 3.1


3.5 - Lack ofaccess tomarkets

Review bureaucraticregulations and requirementsconsidering excemptions foryouth

Supporting enterprises in thedevelopment of productquality, marketing and pricingstrategies

Organisation ofsupplier events topromote products


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Establish and build up localmarket infrastructure


5 2 5.4, 5.5


Training the trainers in youthenterprise developmentSponsor independent review

of entrepreneurshipprogrammes Build capacity in

understanding and workingwith microfinance

Sponsor business pcompetitions

Improve effiicency of school-level enterprise training(including TVET colleges)

3.6 - Skills andtraining

Add entrepreneurship andrelated skills into the schoolcurricula at the primary andsecondary levels

Establish a mechanism forthe review ofentrepreneurshipprogrammes

Provide quality,affordable and youtfocused BusinessDevelopment Serviincluding businesscounselling, incubaand training


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2 7 5.2, 5.3


Offer support for yoenterprise and youtbusiness developm

3.7 - Closed

networks

Support the foundation ofpeer-support networks foryoung entrepreneurs Development of a

women's enterprisenetwork


4 4


Introduce a new businessregulation system

Establish a Youth Watchdogto assess existing legislationand propose changesfocused on youth

3.8 -Bureaucracy,legislation andregulations

Introduce specific rules andincentives for youthbusinesses

Establish a monitoringsystem to monitorimprovement and progress inimproving the system


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5 7 2.1, 2.3, 5.3


Incentives to start a businessin marginalised areas

Organise campaigns topromote youth enterprise andsupport young entrepreneurs

Establish businessnetworking clubs wmembership open tyouth

Campaign against work inillegal settlements

Motivational business-focused capacity building forapathetic youth

3.9 - Cultureand attitudes

Introduce business and

entrepreneurship elements atall education levels

Research and development

of business ideas whichcapable youth can take up

Establishentrepreneurs'volunteer mentorprogramme


7 8 3.1, 3.4, 3.7


Improve access to finance foryouth

3.10 - Capitalor technologyintensity

Reduce technicalrequirements on certainproducts

Increase inspecialisation and scontracting of smalelements of produc


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4 6 3.1, 3.2, 3.5, 3.6, 3.7


Infant industry supportscheme

3.11 -Competition

Youth entrepreneur incentiveand excemptions schemes


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Problem 4 Education and Training

4.1 -Occupation

No recommendations


4 5 4.4, 4.8, 5.2


Thorough review with respectto the education-work gap atall education sectorsincluding higher education,secondary, primary andTVET

4.2 - Gapbetweeneducation andthe labourmarket

Establish an educationtaskforce between theministries of labour, nationaleconomy and education andhigher education tocontinuously check marketneeds and match thoseneeds with changes incurricula and educationalactivities and methods

Training teachers andtrainers in how to focus onmarket needs

Provide accurate aforthcominginformation aboutprivate sector needfrom the labour ma


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Provision of systematiccareer guidance

Develop curriculumguidelines including goodpractices

Implement system to ensurethere is no excess ofgraduates entering themarket

Provide support andcoordination mechanismsand participate actively in thegovernment taskforce

Provide technicalassistance, supportand participate ingovernment task fo

4.3 - Economicstructure

No recommendations


4 5 4.6, 5.2, 5.3


Integrate entrepreneurshipinto curricula at all levels.

Require apprenticeship andinternships elements in themajority of courses

Increase the appreciation andremove the stigma attachedto non-academic disciplines

4.4 - Over-academiccourses

Incentivised non-academicprogrammes

Pilot programmes to activateenterprise clubs

Provideapprenticeships


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Establish enterprise clubs inschools and universities

4.5 - Cost


5 3 5.3


Urgently activate, establishand regulate a functioningand transparent student

scholarship scheme coveringplaces in universities both inthe oPt and abroad

Establish a watchdog toassess and monitor the

scholarship and loanschemes

Revisit and re-establish aproperly functioning studentloan scheme

Nationally regulate costs andfees at universities

Initiate and promotecommunity funding schemesto provide scholarships andloands to prospectivestudents

Provide educationascholarships


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5 5 4.1, 5.2, 5.4


Raise awareness of labourlaw and set realisticexpectations about salariesand career paths

Inform youth about labourmarket needs and potential

Support the creation of anational career guidanceservice

Assess the needs of youth

Encourage youth toinvestigate opportunities

4.6 -Expectationsof youth andfrom youth

Provide academic counsellingand career education earlierin the secondary schoolsystem

Heavily invest in the provisionof career and academiccouselling at the secondaryand university levels



10 6 5.2, 5.3


4.7 -InfrastructureandInvestment

Provide better incentivesystems for teachers, in


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particular, revisiting the lowsalary structure

Focus solely on addressingthe salary structure in theshort term


5 4 5.2, 5.3, 5.4, 5.5



Contribute to career andacademic guidance andeducation

Create a skills database toinform the private sectorabout the availability of skillsin the labour market

Delegate repsonsibility foryouth resources centres tocivil society and providecontinuing support Take responsibility for and

activate youth centres,transforming them into youthresource centres

Provide training to youngwomen focused on non-traditional roles

4.8 - Lack ofservices

Establish cash for trainingand work mechanisms(temporary placementopportunities)

Pilot and support innovative


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service delivery, informationkiosks


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Problem 5 Barriers created by failures in the system

5.1 -Occupation

No recommendations


1 1 5.3 1.3, 2.2, 2


Review and participate in theenhancement of this actionplan

Participate in thereview andenhancement of theyouth action plan

Adopt the newly createdyouth employment actionplan

Review, develop andstrengthen capacity of CSOsand state-actors withresponsibility for youth

Participate in the review andenhancement of the youthaction plan Provide accurate a

forthcominginformation aboutprivate sector need

Improve data collection

5.2 - Lack of acomprehensive nationalyouth strategyand inparticular anational youthemploymentstrategy

Incorporate youth perspective

Introduce and pilot youth-sensitive employmentprogrammes

Focus activity onproviding emergingsector opportunities


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and needs intomacroeconomic policies


1 3 2.3, 3



Carry out youth-employmentimpact analysis of macro-economic policies

Activate the inter-ministerialeducation taskforce with theparticipation of youthorganisations

Mainstream youthemployment at all levels ofgovernment

Take responsibility for andactivate youth centres,transforming them into youthresource centres

Develop a media strategy tofocus on youth employment

5.3 - Poorrepresentation

of the youth inpolitics

Establish dedicated data-collection unit

Assess specific needs ofmarginalised communities



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6 5 5.2, 5.3, 5.5


Support, fund and monitor thecreation of an independenteducational commission

Support and monitor thenewly created independenteducational commission

Mainstream youthemployment at all levels ofgovernment

Provide dedicated, youth-sensitive services

Identify youth service needs,review existing coverage andsupport main-streaming ofyouth employment ingovernment

5.4 - Lack ofdedicatedservices

Esblish and build up schoolcouncils to improveaccountablity

Develop competency basedskills recognition system


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3 7 5.2, 5.4 1


Setup website and databaseto share ideas and poolknowledge and resourcesSupport, fund and monitor the

creation of an independentNGO monitoring commission Initiate regular

communication focusedmeetings

Undertake and disseminatefindings of regular market

research

5.5 -Competitionamong NGOs

Encourage NGOs to

specialise by managingopportunities Actively promote new ideas

that cannot be implementeddue to capacity issues

Launch a youth thintank


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Appendix A:

Meaning of Items in Recommendations Section Tables

Problem:The main problem to be addressed connected to the problem analysis

Contributing factor:The element of the problem that the recommendations address connected to theproblem analysis by the identifying number (eg. 3.2 or 1.4)

Cost Band:An estimate of the cost, where 1 is almost zero and 10 is in the millions of dollars

Time Band:An estimate of the time needed to implement all of the recommendations, where 1is almost immediate and 10 is 3-5 years

Pre-requisite Factors:Contributing factors to this and other problems that are important or required to besolved before this contributing factor can be addressed comprehensively

Dependent Factors:Contributing factors to this and other problems that depend on this factor beingaddressed

Government:Includes the executive (including ministries), legislature and the judiciary as well as

educational institutions or other government run institutions.

Civil Society:Includes community-based organisations, national NGOs and international NGOsthat are working in the oPt.

Private Sector:Includes micro, small, medium-sized and national companies, private institutionsand foundations

International:

Includes international NGOs, foreign governments, bilateral and multilateral donorsand international institutions.

sharek - step forward white paper - youth employment

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