By Khaled Itani | Staff Writer
The economic crisis that Lebanon is facing proved detrimental to the majority of the population, especially public workers whose salaries varied only slightly with the significant challenges that the country has been facing, which include a severe financial crisis, currency devaluation, and hyperinflation. This widened the financial gap between Lebanese public workers and the cost of living, causing substantial hardships for many individuals and families. In this light, this article aims to highlight the economic and financial challenges that the crisis has caused and its impact on the Lebanese public work sector.
The Lebanese economic crisis dates back to 2019, but it truly began after the civil war (1975-1990). Lebanon embarked on a process of post-war reconstruction attempts and tried to revive its war-torn economy. However, due to challenges such as political instability that the country was facing, with Lebanon being ranked 150th out of 180 countries (180 being the worst) on Transparency International’s 2022 corruption index, regional conflicts, and sectarian tensions, which hindered sustained economic development.
In its post-war phase, Lebanon’s economy has been characterized by high levels of public debt, a reliance on remittances from Lebanese exports, and its banking sector with relative stability and high-interest rates which attracted deposits from abroad. However, this economic model proved to be unreliable and unsustainable which led to a series of economic crises and periods of stagnation.
So, this leaves the question, how did this economic crisis which characterized Lebanon as the third most indebted country in the world affect Lebanon’s working class?
In a sample taken by the International Labor Organization of a total of 1987 interviewed workers, 84% were laid off and 94% saw their wages largely reduced, which led to a significant increase in unemployment and a large segment of the Lebanese and non-Lebanese population fall below the poverty line, while those who were already living in poverty had their livelihood worsen due to inflation. People in Lebanon are faced with many challenges even before joining the workforce, with a large number of youth unable to attain jobs and positions in companies due to structural barriers such as a lackluster education system and high competition as a result of decreasing job opportunities, and personal challenges which are essentially the lack of money due to poverty and a constrained professional network and connections.
The repercussions of reduced wages and deteriorating working conditions extend far beyond the immediate financial strain experienced by workers. As salaries shrink or stagnate, individuals and families find themselves grappling with the harsh reality of making ends meet on increasingly limited resources. Basic necessities such as food, housing, education, and healthcare become increasingly unaffordable, pushing many workers and their families into the throes of poverty and deprivation.
The erosion of purchasing power not only impacts workers’ ability to meet their immediate needs but also hampers their capacity to plan for the future and invest in long-term goals such as education, homeownership, or retirement savings. As disposable incomes dwindle, workers are forced to make difficult trade-offs and sacrifices, often having to forgo essential expenses or delay important life milestones.
Moreover, the psychological toll of financial insecurity and economic instability cannot be overstated. The constant anxiety and stress stemming from the uncertainty of whether one will be able to make ends meet, pay bills, or afford healthcare can take a severe toll on workers’ mental and emotional well-being. This prolonged state of financial precarity can lead to heightened levels of anxiety, depression, and overall dissatisfaction with life.
Lebanon’s economic downturns have deeply affected the workforce of Lebanon, particularly among public service employees. Lebanon’s continuous struggle and challenges resulted in financial crisis, currency devaluation, hyperinflation, and wage disparities. The problem has been exacerbated by unemployment rates which have sky-rocketed, low wages, and increased poverty levels. It is imperative that the Lebanese government and its people not to fall silent to the chaos and detrimental effects of this crisis, action must be taken to better the economy and livelihood of the struggling Lebanese citizens.
Sources:
https://www.worldbank.org/en/home
https://www.imf.org/en/Home
https://www.ilo.org/wcmsp5/groups/public/—arabstates/—ro-beirut/documents/publication/wcms_848390.pdf