Enab Baladi – Jana al-Issa
State employees in Syria are waiting to receive their salaries at the beginning of February. The latest increase approved by the new Syrian administration has quadrupled salaries compared to the previous regime.
The new increase percentage reached 400%, and despite this, the salary value remains significantly lower than family needs, which have now approached ten million Syrian pounds.
This proposed increase raises the average salary from around 15 to nearly 70 US dollars. Economists agree that this is merely a “temporary measure” to meet a small portion of demands but is certainly insufficient.
Despite its inability to cover needs, the Ministry of Finance decided not to grant the increase to all employees, without clearly specifying which categories would receive it. It indirectly stated that the increase would only be for those whose “qualifications match their jobs,” while others would remain on the old salary.
The interim government in Damascus also granted a number of employees, without specifying how many, a three-month leave while still receiving their salaries. However, it did not clarify whether the increase would include these “dismissed” employees or not.
Finance Minister Mohammed Abazeid stated that the government was surprised to find that the number of registered workers in public sectors was much larger than the actual numbers on the ground. In addition, there are discrepancies in financial lists, with fictitious names of people receiving their salaries at home without officially registering their attendance in their respective offices, due to the previous regime’s policies of nepotism and connections.
Lowest salary is 1.2 million pounds
On January 5, the interim government in Damascus raised salaries for public sector employees by 400%, according to Finance Minister Mohammed Abazeid.
The estimated cost of the increase is around 1.65 trillion Syrian pounds (approximately 127 million US dollars), and it will be funded from current state resources, in addition to a mix of regional aid, new investments, and efforts to release frozen Syrian assets abroad, as stated by the minister.
There are more than 1.25 million employees on the public sector payroll in Syria, according to statements from sources in the Ministry of Finance.
Before the decision, the minimum wage in Syria was equal to 278,910 Syrian pounds, while the lowest salary for employees after the recent increase will reach 1.2 million Syrian pounds.
Needs exceed nine million pounds
At the beginning of this year, the average cost of living for a Syrian family of five, according to the kassioun Index of Living Costs, exceeded 14.5 million Syrian pounds, with the minimum reaching about 9.1 million Syrian pounds, highlighting the significant gap that separates the minimum wage from the constantly rising average living costs.
To balance income and expenses, most Syrians rely on multiple sources of income, with remittances from expatriates outside Syria and secondary jobs being the primary sources. Families often forgo essentials in their lives to reduce their spending.
Labor and production reality is unclear
Since the 1990s, hundreds of thousands have entered the labor market each year, yet only an average of 50,000 were employed in both the public and private sectors. The rest faced unemployment, migration, or economic setback, according to economic expert and former governor of the Central Bank of Syria, Duraid Durgham, in an interview with Enab Baladi.
Durgham added that unemployment is one of Syria’s most pressing issues, previously tackled inappropriately through massive employment in the public sector, under a failed social contract (low wages and subsidized basic commodities). The private sector provided only a tiny portion of the jobs needed, with social solidarity being a characteristic of Syrians to alleviate suffering in general. Since 2008, the journey of lifting subsidies on basic commodities has begun, widening the gap between wages and needs.
To bridge this gap, Dr. Durgham believes it is essential to study the labor market and production reality more thoroughly, understanding the relationship with external parties, addressing the issue of displaced individuals, and recognizing the available resources domestically, along with what is genuinely available (not promises) from abroad, before contemplating solutions.
Dr. Sulaiman Mouselli, a professor at the University of Damascus’ Faculty of Economics, told Enab Baladi that addressing this gap requires two directions: first, improving salary figures, and second, enhancing purchasing power through measures that stabilize and lower the dollar exchange rate, resulting in improved purchasing power.
For instance, a decrease in food prices means greater purchasing power for the same salary figure, which is equal to or exceeds the importance of increasing salary numbers. This benefits both employees and non-employees, thereby being advantageous to all citizens.
Unemployment doubles
It is not only employees suffering from low wages; millions of people are unemployed in the public sector. While private sector salaries are relatively higher, they cannot compete with the recent price hikes, as employers cannot afford to pay four times their workers’ wages.
In the absence of external resources or changes to the current production pattern, salary increases in both the public and private sectors are unfeasible, as most of them face the threat of bankruptcy and issues related to withdrawing funds from accounts, coupled with a generally unclear economic future, according to economist Duraid Durgham.
In the past, the share of salaries from the added value in each company was minimal. With the current recession, it has gained significance as added values have diminished, and the private sector is operating more than it produces, which has led many to lay off workers.
Durgham clarified that if we consider layoffs in the private sector alongside the dismissal of most members of the army, police, and many employees in the public sector, unions, and federations, the increase in unemployment will likely reach hundreds of thousands. This poses a severe threat of famine for millions of Syrians in the coming days and weeks, resulting in unprecedented security fallout.
In light of these circumstances, Durgham believes the government should focus on several foundational points:
- Reassessing the policy of liquidity confinement that leads to economic paralysis.
- Addressing the poverty-stricken population within the country (including those arriving from external displacement camps), which requires the state to activate a comprehensive vision for infrastructure projects capable of employing large numbers and creating a favorable environment for work and investment. Additionally, as a principle, unemployment benefits should be established not only for those who have lost their jobs but for every family without a working member.
- Addressing the production issue, which cannot progress without smooth importation of raw materials and facilitating banking operations for import and export.
- Defining priorities for available support in production (in terms of modernizing leading sectors, lending, fees, etc.).
Meanwhile, Dr. Sulaiman Mouselli points out that the salaries of non-public sector employees developed and partially matched the price increases during the era of the ousted regime, as private sector employees received salaries and cost-of-living compensation, which increased the income disparities between them and public sector employees. This anticipated raise will narrow the gap between them to some extent and may encourage the private sector to improve its wages.
Mouselli believes that with regard to the dismissed and laid-off workers, they should undergo vocational training aligned with their skills, as the community’s need for skilled laborers is high during the reconstruction phase. The cost of entering such training programs is substantial and would increase employee incomes. He emphasizes that these programs should be conducted by the Small and Medium Enterprises Development Authority and NGOs.