Rising unemployment and poverty

As explained earlier, private-sector-led investment following economic liberalisation was not socially responsible. It was not good-quality, high- capital-output investment - that is, in manufacturing. Manufacturing is the backbone of development, and in developing countries such as Syria, labour demand is derived from development. Manufacturing investment had been low since the 1980s. The manufacturing share of total value-added was 8 per cent in 1989, dropping to 6 per cent in 1995, then further to 2 per cent in 2000. In 2011, the year of the uprising, this share was only 5 per cent (UNIDO, 2014). Economic growth during the Assad regimes (Hafiz and Bashar) was primarily rent-based, relying on oil export revenues, geopolitical rents and capital inflows including remit- tances.14 During 2000-08, Syria experienced an average economic growth rate of 5 per cent (Central Bureau of Statistics, 2011), mostly attributable to the second oil boom of 2002-08 and to the reopening of the Iraqi oil pipeline in 2000, when Syria became the main route for Iraqi oil to be exported outside the UN-controlled oil-for-food programme.15 GDP per capita grew at an annual rate of 2.4 per cent during 2000-07 (World Bank, 2014). Nevertheless, this rent-based growth was anti-developmental. The new agent of investment under the Assad regimes promoted artisanal and low-quality investment in services, real estate, transport and family based projects that served private as opposed to public interests.

Rising unemployment and poverty in Syria (as elsewhere) are a result of long-term contraction in manufacturing investment. Many workers were pushed into the informal sector due to the private sector's inability to generate jobs. In 2009, the Central Bank of Syria reported the unemployment rate to be 8.2 per cent, while Syrian economists estimated the rate to be 16.5 per cent (Barout, 2011: 114). However, youth unemployment was more than twice total unemployment and remained at double-digit levels (see Table 6.7). Female unemployment reached 37.1 per cent in 2011 (Central Bureau of Statistics, 2011). As a result, workers in the informal sector during 2000-07 amounted to 30 per cent of total non-agricultural employment (Jutting, J. and de Laiglesia, 2009).

According to UNDP figures, the poverty rate was 30.1 per cent in 2003-04, representing 5.3 million individuals (UNDP, 2005). It increased to 34.3 per cent in 2010 (representing 7 million people) (El-Laithy and Abu-Ismail, 2010).

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