EMPLOYMENT AND LABOUR MARKET ANALYSIS LEBANON Published by CONTENT LIST OF FIGURES 4 LIST OF TABLES 5 LIST OF ABBREVIATIONS 6 1 EXECUTIVE SUMMARY 10 2 FRAMEWORK CONDITIONS FOR EMPLOYMENT GENERATION 22 Economic situation 24 Infrastructure conditions 26 Demographic development 27 Political situation 29 Investment climate and business environment 30 Economic policy and strategies 31 Summary of challenges and opportunities 32 3 LABOUR MARKET TRENDS 34 Employment figures 36 Youth employment 37 Child labour 38 Summary of challenges and opportunities 39 THE LABOUR DEMAND SIDE: THE IMPACT OF BUSINESS 4 AND SECTOR DEVELOPMENT ON EMPLOYMENT GENERATION 40 Actors 42 Potential for growth and job creation 46 Employment in MSMEs 46 Employment with entrepreneurs 51 Employment in international trade 52 Employment in the informal sector 54 Employment in the public sector 55 Summary of challenges and opportunities 55 THE LABOUR SUPPLY SIDE: THE QUALITATIVE DIMENSION 5 OF LABOUR FORCE DEVELOPMENT 58 Actors 60 Higher education 64 Vocational education 66 Life and soft skills training 67 Qualifications within the labour force 67 Labour migration and labour mobility 67 Cultural perception of employment and jobs 71 Status of specific jobs 71 Gender-specific employment 72 Summary of challenges and opportunities 74 6 MATCHING DEMAND FOR AND SUPPLY OF LABOUR 76 Actors 78 Matching demand and supply 80 Recruiting staff 82 Retaining staff 83 Wages and collective bargaining system 84 Social protection policies 86 Summary of challenges and opportunities 88 7 IMPORTANT SECTORS FOR EMPLOYMENT GENERATION 90 Agro-food 93 Construction 97 Creative industries 99 Health 103 Information and communications technology 104 Tourism and hospitality 107 8 RECOMMENDATIONS 112 Recommendations: framework conditions 114 Recommendations: Demand side 117 Recommendations: Supply side 120 Recommendations: Labour-market matching 124 9 APPENDIX 128 Appendix 1: Methodology 130 Appendix 2: Bibliography 131 Appendix 3: Resource persons 136 Appendix 4: Endnotes 138 LIST OF FIGURES Figure 1: Overview of structure of ELMA report 12 Figure 2: GDP development 2008-2017 24 Figure 3: Population pyramid 2010 (left) and 2017 (right) 28 Figure 4: Estimated population development 28 Figure 5: Most problematic factors for doing business in Lebanon 30 Figure 6: Status of employment of Lebanese (2007) 36 Figure 7: Unemployment rates for Lebanon, 1991-2015 (total, youth, disaggregated by sex) 37 Figure 8: Percentage of children and youth aged 5-17 engaged in child labour during last week before being interviewed across population groups 38 Figure 9: Private enterprises, by size 46 Figure 10: Registered enterprises, by type 46 Figure 11: Total SME turnover, by activity, as a percentage 47 Figure 12: Indicator Business Sophistication, Global Competitiveness Index 49 Figure 13: Shares of tradable vs. non-tradable activities of FDI flows 52 Figure 14: Lebanon’s export share and comparative advantage 53 Figure 15: Gross enrolment ratio (per cent) in 2017 for selected Arab countries 65 Figure 16: Enrolment in TVET as percentage of total enrolment in secondary education, 2017, selected Arab countries 66 Figure 17: Economic activity rates by age groups and sex 72 Figure 18: Employment in major sectors by sex, 2009 73 Figure 19: Recruitment methods vs. job search techniques 81 Figure 20: Factors taken into consideration by firms when recruiting for a position 83 Figure 21: Minimum wage (USD per month) for a full-time worker 85 Figure 22: NSSF subscribers, in numbers, 2014 86 Figure 23: Sectors with highest direct economic potential in 2025 92 Figure 24: Key stakeholders in the agro-food industry 94 Figure 25: Export destinations for agro-industrial products, in per cent, 2017 95 Figure 26: Key stakeholders in the residential construction industry 97 Figure 27: Creative industry sub-sectors 100 Figure 28: Ecosystem actors in the ICT sector 105 Figure 29: Tourist arrivals 108 Figure 30: Overview of research methodologies employed in ELMA Lebanon 2019 130 LIST OF TABLES Table 1: Global Competitiveness Index, Institutions 29 Table 2: Scorecard for international benchmarking reports 30 Table 3: Framework conditions – challenges and opportunities for employment generation 32 Table 4: Labour trends – challenges and opportunities for generating employment 39 Table 5: Demand side - challenges and opportunities for employment generation 55 Table 6: Gross enrolment ratio, 2011-2017, all population 65 Table 7: Supply side – challenges and opportunities for employment generation 74 Table 8: Estimated median monthly earnings by employment status in Lebanon’s private sector, 2010 (USD) 84 Table 9: Matching – challenges and opportunities for employment generation 88 Table 10: Strength-Weakness-Opportunities-Threat (SWOT) analysis, agro-food sector in Lebanon 96 Table 11: Proportion of Lebanese and Syrian workers per job category in North Lebanon, 2010 98 Table 12: SWOT analysis, construction sector in Lebanon 99 Table 13: Main creative clusters identified in Lebanon 100 Table 14: SWOT analysis, culture and creative industries in Lebanon 102 Table 15: SWOT analysis, health sector in Lebanon 104 Table 16: SWOT analysis, ICT sector in Lebanon 107 Table 17: Planned investment projects in cultural heritage/tourism sector 109 Table 18: SWOT analysis, tourism and hospitality sector in Lebanon 110 5 LIST OF ABREVIATIONS ALI Association of Lebanese Industrialists (i)NGO (international) Non-government Organisation (M)SME (Micro), small and medium sized enterprises AC Air condition AI Artificial Intelligence ANERA American Near East Refugee Aid ANUGA Allgemeine Nahrungs- und Genussmittel-Ausstellung AUB American University of Beirut BDL Banque Du Liban, Central Bank BDS Business Development Services BIAT Business Incubation Association Tripoli BMZ German Federal Ministry for Economic Cooperation and Development BRD Beyond Reform and Development BSU Business Support Unit BT Baccalaureate Technique CAS Central Administration of Statistics CCIA / CCIB Chamber of Commerce, Industry and Agriculture / The Chamber of Commerce, Industry and Agriculture Beirut CEDRE Conférence économique pour le développement, par les réformes et avec les entreprises CGTL The General Confederation of Lebanese Workers CIP Capital Investment Programme ConTra BMZ/GIZ Construction and Training Programme CV Curriculum Vitae DFID British Department for International Development DGVTE Directorate General for Vocational and Technical Education DS Dual System EC European Community ECOSOC Economic and Social Council of Lebanon ELMA Employment and Labour Market Analysis ESFD Economic and Social Fund for Development ETF European Training Foundation EU European Union FAO Food and Agricultural Organisation FDI Foreign Direct Investment GCC Gulf Cooperation Council GDP Gross Domestic Product GEM Global Entrepreneurship Monitor GEOs Guidance and Employment Offices GER Gross enrolment rate GIL Generation of Innovation Leaders GIZ Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH GNP Gross National Product HR Human Resources ICT Information and communication technology IDAL Investment Development Authority of Lebanon IECD Institut européen de coopération et de développement ILO International Labour Organization KfW Kreditanstalt für Wiederaufbau KILM Key Indicator of the Labour Market LBP Lebanese pound LCRP Lebanon Crisis Response Plan LEDA Local Economic Development Agency LHSP The Lebanon Host Communities Support Programme LT Licence Technique MEHE Ministry of Education and Higher Education MENA Middle East and North Africa MoA Ministry of Agriculture MoET Ministry of Economy and Trade MoI Ministry of Industry MoPH Ministry of Public Health MoSA Ministry of Social Affairs MW megawatt NEO National Employment Office NPTP Emergency National Poverty Targeting Programme NSSF National Social Security Fund OECD Organization for Economic Co-operation and Development PPP Public-Private Partnership PRL Palestinian refugees from Lebanon ProVTE EU/GIZ Programme for the technical assistance for a more practice oriented VTE in Lebanon PRS Palestine refugees from Syria Qudra Regional programme for the resilience for Syrian refugees, IDPs and host communities in response to the Syrian and Iraqi crises RCA Revealed comparative advantage RCDL Rassemblement de Dirigeants et Chefs d'Entreprises Libanais SCC The Syndicate Coordination Committee SDGs Sustainable Development Goals STEP Subsidised Temporary Employment Programme SWOT Strengths-Weaknesses-Opportunities-Threats TEA Total Entrepreneurship Activity 7 TS Technicien Supérieur TSEZ Tripoli Special Economic Zone TVET Technical and vocational education and training UDP-NL EU/BMZ/GIZ Urban Development Programme North Lebanon UN DESA United Nations Department of Economic and Social Affairs UNDP United Nations Development Programme UNESCO United Nations Educational, Scientific and Cultural Organization UNHCR United Nations High Commissioner for Refugees UNICEF United Nations International Children's Emergency Fund UNIDO United Nations Industrial Development Organization UNRWA United Nations Relief and Works Agency for Palestine Refugees in the Near East USAID United States Agency for International Development USD US Dollar VC Venture capital VTE Vocational and technical education WASH Water, sanitation, hygiene WEF World Economic Forum WHO World Health Organisation 9 EXECUTIVE SUMMARY 11 EXECUTIVE SUMMARY The Employment and Labour Market Analysis qualitative development of labour force development Lebanon (ELMA Lebanon) provides