On 8/7/2010 Dr. Omar Alrazzaz gave Amman Institute staff a presentation entitled “Beyond Rentierism: the building blocks of the workfair state” Dr. Omar Alrazzaz is the Director General of the Social Security Corporation (SSC) in Jordan.

1. Beyond Rentierism: the building blocks
of the workfair state
July/2010

2. Outline
• From rentierism to workfair.
•Status quo of labor market.
• Challenges.
• From short-term measures to a national
strategy for employment.
• The Role of Amman Municipality.

3. • From rentierism to workfair.
• Macro-economy
• Micro-economy.
• Political dimension
• Social dimension.

4. Status Quo of Labor Market
Labor market conditions are not in favor of SSC’s financial position
ُEast Asia & Pacific
Paraguay
Philippines
Latin America & Caribbean
Jamaica
Europe & Middle Asia
Syria
South Asia
Sri Lanka
Guatemala
Morocco
MENA
Salvador
Egypt
33 percent 6 percent
Jordan
0 10 20 30 40 50 60 70 80 90 100
Employed Unemployed Not in the labor market.
4

5. Status Quo of Labor Market
Male Employed Female Employed
Country
Persons to Manpower Persons to Manpower
64% 12%
Jordan
89% 39%
Syria
84% 29%
Morocco
78% 30%
Tunisia
77% 22%
Egypt
* Data, 2005

6. Status Quo of Labor Market
Distribution of Inactives:
• Housewives, (50%).
• Students,(30%).
• Early Pensioners, (20%).

7. Status Quo of Labor Market
Non-Jordanian Workers:
• Around (420) thousands are non-Jordanian
workers – MOL Estimations.
• Two times this number are unemployed
Jordanians.
• The above two groups are similar in terms of
age and education.

8. Challenges
• Demographic changes accompanied by:
– Early retirement pension prevails over other pensions.
– Decrease in fertility & mortality rates.
– Conditions of the labor market.
5
Insured
Persons 1
Insured
Person
1 1
Pensioner Pensioner
8

9. Challenges
Challenge:
• Increase in jobs created from (50) thousands to
(100) thousands.
• Increase Jordanians’ share in jobs created from
50% to (85%) in 2020, and (95%) in 2030.
• Increase in the share of Jordanians in the labor
force.

10. Challenges
Expected % of
Work force Employed Persons Employed
Year Population
(Million) (Million) to work
(Million) force
2010 6.0 3.0 1.0 33%
2020 7.5 4.4 2.0 45%
2030 9.0 6.0 3.0 50%

11. From short-term solutions to a national
strategy for employment
• Short-terms & unsustainable measures:
1. Employ Jordanians in the public sector
for Jordanians.
2. Reliance on non-Jordanian workers in the
private sector.
3. Encourage exporting qualified workers to
Arab Countries.

12. From short-term solutions to a national
strategy for employment
• Towards a national strategy for employment:
First: Legal Frame.
1. Labor Law: stabilizing labor market, protecting workers.
2. Social Security Law: Extending coverage, new insurances.
3. Health Insurance.
Second: Investment Policies & Economic Development:
1. Focus on added-value in investment promotion policies.
2. Make profits generated from speculations in stock market
and real estate market subject to taxes.
3. Encourage efficient, labor intensive sectors.

13. From short-term solutions to a national
strategy for employment
Third: Education Policies:
1. Matching between the outcomes of the educational sector
and labor market (number & majors).
2. Focus on education that is consistent with the needs of
the knowledge-based economy.
3. Team work, critical thinking, & information-searching
skills.
4. Promotion of Citizenship and volunteer work.
Fourth: Supply & Demand Geography:
1. Facilitate transportation to workplace.
2. Internal housings for workers.

14. From short-term solutions to a national
strategy for employment
Fifth: Enhance women participation in Labor Market
1. Maternity Insurance.
2. Nurseries.
3. Micro-finance.
4. Home-based occupations.
Sixth: Promote vocational & technical occupations:
1. Restructuring vocational training.
2. Return to military service in a way that serves building
capacities and skills of fresh graduates.
3. Awareness-raising campaigns to promote this culture.

15. Role of Amman Municipality .
• Transportation
• Housing
• Cost of business operation.

16. Recommendations
• National Strategy for Employment that:
• Matches between supply & demand over the next (10)
years.
• Produces time-lined action plans and programs for
productive sectors in a way that gradually replaces non-
Jordanian workers by Jordanians.
1. Plan for matching between education policies &
demands of labor market.
2. Increases productivity of Jordanian worker.
3. Contributes to restructure Jordanian economy to
be oriented towards high added-value goods &
services.