Palestinians Lose Jobs as Israeli Firms Seek Foreign Replacements

Israel has sent back thousands of Palestinians to the besieged Gaza Strip - Reuters Photo
Israel has sent back thousands of Palestinians to the besieged Gaza Strip - Reuters Photo
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Palestinians Lose Jobs as Israeli Firms Seek Foreign Replacements

Israel has sent back thousands of Palestinians to the besieged Gaza Strip - Reuters Photo
Israel has sent back thousands of Palestinians to the besieged Gaza Strip - Reuters Photo

When Taha Amin-Ismail Khalifeh dialled into a conference call with his Israeli employer last month, the Palestinian hotel worker expected a briefing on how the Israel-Hamas war was affecting business. Instead, he and 40 others were laid off.

Khalifeh, who lives in the Israeli-occupied West Bank, had worked as a housekeeper in the hotel in East Jerusalem for more than 20 years.

About 160,000 Palestinians from the West Bank who were working in Israel and in Jewish settlements have lost or are at risk of losing their jobs because of the closure of border crossings from the West Bank into Israel and settlements, and restrictions on their access to Israel's job market, according to the UN's International Labour Organization (ILO).

Israel has also sent back thousands of Palestinians to the besieged Gaza Strip, Reuters report said.

It had previously issued 18,000 permits allowing Gazans to cross into Israel and the West Bank to take jobs in sectors like agriculture or construction that had salaries up to 10 times what a worker could earn in the blockaded enclave.

Many of the Palestinians worked as day laborers in Israel, or in Jewish settlements in the West Bank, and have been unable to travel to their jobs due to the closure of border crossings since Hamas's Oct. 7 assault on southern Israel.

Like many of them, Khalifeh had mixed feelings about working for an Israeli business, but it was his best option for a reliable pay cheque. Unemployment is running at about 46% in Gaza and 13% in the West Bank, and wages are much lower.

"There is nothing that would provide us with a living except working in Israel," Khalifeh told the Thomson Reuters Foundation by phone. "We have no other choice."

Now jobless for more than a month, he fears he may never be able to return as Israeli businesses urge the government to plug the labor gap left by the Palestinian workers from nations including India and Sri Lanka.

Israeli farms, buildings sites and hotels are among the sectors struggling with a shortage of workers since the war erupted, and some foreign migrant laborers have left, fearing for their safety.

The Israel Builders Association (ACB) has asked the government to seek to recruit at least 60,000 foreign laborers to fill the gap left by the Palestinians, Shay Pauzner, the ACB's deputy director-general, said in emailed comments.

Sri Lanka, desperate for dollars and remittances, plans to send 10,000 workers for the Israeli construction industry, part of a wider contingent of 20,000 workers also including farm laborers, a government minister told Reuters last month.

Israel's Foreign Ministry, the Population and Immigration Authority and COGAT, the government agency that oversees entry permits, did not respond to requests for comment.

- FRAGILE ECONOMY

Efforts to bring in replacements from overseas have raised fears that Palestinian workers' long-term employment prospects could be jeopardized, regardless of what happens in the current conflict.

"This is dangerous issue," Saeed Omran, head of media at the Palestine General Federation of Trade Unions, said by phone, though he added that it would take time for tens of thousands of foreigners to be hired.

"How are they going to get them so fast?" he said.

The long-term loss of Israeli jobs would deal another blow to the fragile Palestinian economy, which is dependent on foreign aid and vulnerable to Israeli travel restrictions in the West Bank.

According to the ILO, the Palestinian job losses since the start of the war equate to a daily income loss of $16 million. That raises concerns about how Palestinians will live and work in the months and years to come, especially in Gaza, said Miriam Marmur, the public advocacy director at Gisha, an Israeli nonprofit which campaigns for freedom of movement of Palestinians.

"It's hard to imagine that workers from Gaza will be given access to jobs. What's going to be the humanitarian and economic reality in the Strip? What's the situation of the Palestinian economy going to be coming out of this?" Marmur said.

For low-paid workers, the loss of income is already causing financial pain.

Construction worker Muthana Jamal Hassan, 33, who lives in the West Bank city of Jenin, had just finished a painting job in Tel Aviv when the war broke out.

He earned $140 a week and was his family's main breadwinner, but has had no income since the war began, and said he will soon be forced to get into debt to cover his family's basic needs.

Because of the border closures, he said he can not safely cross the border and fears being shot at or detained by Israeli security forces if he tries to do so.

"We used to work to eat and drink, not to buy villas and cars," he said by phone from his home. "We were living in a certain way and now it was taken away from us overnight."

- FOREIGN WORKERS

Israeli efforts to recruit foreign workers to replace Palestinians have drawn criticism from trade unionists in India, with the Construction Workers Federation of India calling the push "immoral", pointing to the death toll in Israel's bombardment and ground invasion of Hamas-ruled Gaza.

Palestinian health authorities deemed reliable by the United Nations say more than 15,000 Gazans have been confirmed killed.

Referring to the ACB's request for foreign laborers to be hired, a spokesperson for Israeli migrant rights labor group Kav LaOved said the mass recruitment of foreign workers at short notice during wartime might threaten their rights.

"They want to bring in so many people without being prepared," said spokesperson Assia Ladizhinskaya.

"We need Israel to enforce (workers') rights to check if they're being recruited normally, if the employer can communicate with them with translators, and do checks in the fields and the construction sites to see if the workers are being treated well," Ladizhinskaya added.

The group has been helping dozens of workers recover unpaid wages by contacting their employers, and has urged the Israeli government to let laid-off Palestinians withdraw funds from their pensions to help them cope with the earnings loss.

Construction worker Ahmad Mohammad Abu Sbay used to be paid 3,800 shekels ($1,023) per month, which he said was just enough to cover the family's needs, but he has not worked since the war began.

"I don't know how I'm going to feed my family," the 37-year-old father-of-four said by phone from his home in the West Bank city of Bethlehem.

"I feel the mental pressure every minute and every hour."



Borderless Europe Fights Brain Drain as Talent Heads North

Eszter Czovek, 45, packs up her house as she moves to Austria, in Budapest, Hungary, October 28, 2024. REUTERS/Bernadett Szabo
Eszter Czovek, 45, packs up her house as she moves to Austria, in Budapest, Hungary, October 28, 2024. REUTERS/Bernadett Szabo
TT

Borderless Europe Fights Brain Drain as Talent Heads North

Eszter Czovek, 45, packs up her house as she moves to Austria, in Budapest, Hungary, October 28, 2024. REUTERS/Bernadett Szabo
Eszter Czovek, 45, packs up her house as she moves to Austria, in Budapest, Hungary, October 28, 2024. REUTERS/Bernadett Szabo

Until recently aerospace engineer Pedro Monteiro figured he'd join many of his peers moving from Portugal to its richer European neighbors in the quest for a better-paid job once he completes his master's degree in Lisbon.
But tax breaks proposed by Portugal's government for young workers - up to a temporary 100% income tax exemption in some cases - plus help with housing are making him think twice.
"Previous governments left young people behind," said Monteiro, 23, who is studying engineering and industrial management at the Higher Technical Institute in the Portuguese capital. "The country needs us and we want to stay but we need to see signs from the government that they are implementing policies that will help."
Monteiro cites in particular the cost of buying or renting a home amid a housing crisis aggravated by the arrival of wealthy foreigners lured by easy residency rights and tax breaks, Reuters said.
He is doubtful the government's new measures will be enough.
"Some of my friends are now working abroad and earn substantially more money... and have better career development opportunities," he said. "I'm a little bit skeptical concerning my job opportunities here in Portugal."
Portugal is the latest country in Europe to seek to tackle a brain drain holding back its economy. Tax breaks for young workers in the budget currently going through parliament will take effect next year and could benefit as many as 400,000 young people at an annual cost of 525 million euros.
Talent flight to wealthier countries of the north is a problem Portugal shares with several others in southern and central Europe, as workers take advantage of freedom of movement rules within the trade bloc. Countries including Italy have tried other schemes to counter the flight, with mixed results.
By exacerbating regional labor shortages and depriving poorer countries of tax revenues, it is yet another hurdle for the EU as it tries to improve its ebbing economic growth while addressing population decline and lagging labor productivity.
Donald Trump's victory in US elections this month raises the stakes, with the risk of across-the-board trade tariffs on European exports of at least 10% - a move that economists say could turn Europe's anaemic growth into outright recession.
About 2.3 million people born in Portugal, or 23% of its population, currently live abroad, according to Portugal's Emigration Observatory. That includes 850,000 Portuguese nationals aged 15-39, or about 30% of young Portuguese and 12.6% of its working-age population.
More concerning still is that about 40% of 50,000 people who graduate from universities or technical colleges emigrate each year, according to a study by Business Roundtable Portugal and Deloitte based on official statistics, costing Portugal billions of euros in lost income tax revenue and social security contributions.
DEMOGRAPHIC HELL
"This is not a country for young people," said Pedro Ginjeira do Nascimento, executive director of Business Roundtable Portugal, which represents 43 of the largest companies in the nation of 10 million people. "Portugal is experiencing a true demographic hell because the country is unable to create conditions to retain and attract young talent."
Internal migration within the EU is partly driven by the disparity in wages between its member states. Some economic migrants also say they are looking for better benefits such as pensions and healthcare and less rigid, hierarchichal structures that give more responsibility to those in junior roles.
Concerns are mounting over the long-term viability of Europe's economic model with its rapidly ageing population and failure to win substantial shares of high-growth markets of the future, from tech to renewable energy.
Presenting a raft of reform proposals aimed at boosting local innovation and investment, former European Central Bank chief Mario Draghi said in September the region faced a "slow agony" of decline if it did not compete more effectively.
Eszter Czovek, 45, and her husband are moving from Hungary to Austria, where workers earn an average 40.9 euros ($29.95) per hour compared to 12.8 euros per hour in Hungary, the largest wage gap between neighboring countries in the EU.
The number of Hungarians living in Austria increased to 107,264 by the beginning of 2024 from just 14,151 when Hungary joined the EU.
Czovek's husband, who works in construction, was offered a job in Austria, while she has worked in media and accounting at various multinationals. She cited better pay, pensions, work conditions and healthcare as motives for moving. She also mentioned her concern over the political situation in Hungary, which she fears might join Britain in leaving the EU.
"There was a change of regime here in 1989 and 30 years later we are still waiting for the miracle that will see us catch up with Austria," Czovek said of the revolution over three decades ago that ended communist rule in Hungary.
Since Brexit, the Netherlands has replaced Britain as a preferred destination for Portuguese talent while Germany and Scandinavian countries are also popular.
Many Europeans still head to the United States in search of better jobs - about 4.7 million were living there in 2022, according to the Washington-based Migration Policy Institute, which nonetheless notes a long-term decline since the 1960s.
In 2023, 4,892 Portuguese emigrated to the Netherlands, surpassing Britain for the first time, which in 2019 received 24,500 Portuguese.
At home, they face the eighth-highest tax burden in the Organization for Economic Co-operation and Development (OECD) even as house prices rose 186% and rents by 94% since 2015, according to property specialists Confidencial Imobiliario.
A single person in Portugal without children earned an average of 16,943 euros after tax in 2023 compared to 45,429 euros in the Netherlands, according to Eurostat.
Portugal will offer under 35s earning up to 28,000 euros a year a 100% tax exemption during their first year of work, gradually reducing the benefit to a 25% deduction between the eighth and tenth years.
Young people would also be exempted from transaction taxes and stamp duty when buying their first home as well as access to loans guaranteed by the state and rent subsidies.
"We are designing a solid package that tries to solve the main reasons why the young leave," Cabinet Minister Antonio Leitao Amaro said in an interview with Reuters.
'THINGS WON'T CHANGE'
Leitao Amaro said he did not know for sure if the tax breaks would work but that his government, which came into office in April, had to try something new.
"If we don't act ambitiously, things won't change and Portugal will continue down this path," he said.
The Italian government has already found that tax breaks used as incentives are costly and open to fraud.
In January, Italy abruptly curtailed its own scheme that was costing 1.3 billion euros in lost tax revenue, even as it lured tech workers such as Alessandra Mariani back home.
Before 2024, returners were offered a 70% tax break for five years, extendable for another five years in certain circumstances. Now, it plans to offer a slimmed-down scheme targeting specific skills after it attracted only 1,200 teachers or researchers - areas where Italy has a particular shortage.
Mariani said the incentives were key to persuading her to return to Milan in 2021 by allowing her to maintain the same standard of living she enjoyed in London.
"Had the opportunity been the same without the scheme, I would not have done it at all," said Mariani, now working at the Italian arm of the same large tech company.
With her tax breaks poised to be phased out by 2026 unless she buys a house or has a child, Mariani faces a drop in salary and she said she's once again eyeing the exit door.