Impact of the war in Gaza on private sector workers and businesses in the West Bank – ILO study

03 July 2024

Executive summary

With the onset of the war in Gaza in October 2023, Israel introduced a set of measures in the West Bank that have had devastating economic repercussions. These measures include the imposition of movement restrictions in the form of checkpoints and roadblocks between and within West Bank governorates; frequent military incursions into Palestinian towns, villages and camps; the revocation of permits for Palestinians working in Israel and the settlements; and the continued withholding of the Palestinian Authority’s custom duties revenue. These measures, alongside the intensification of settler attacks on Palestinian lives and livelihoods across the West Bank and a new wave of settlement construction throughout area C and rural areas, have further exacerbated the situation. As a result, the West Bank’s economy faces significant contraction, evidenced by a sharp decline in gross domestic product (GDP), reduced production and rising unemployment rates.

Given these dire conditions, this study aims to provide a diagnostic assessment of the impact of the war in Gaza on private sector workers and businesses in the West Bank. To this end, this study:

1. offers theoretical and empirical evidence on the impact of wars and conflicts on labour markets globally, including insights from previous conflicts and wars experienced by the Occupied Palestinian Territory;

2. analyses recent labour market trends in the Occupied Palestinian Territory, with a particular focus on the West Bank, such as labour force participation, employment, wages and informality, among others;

3. assesses the impact of the ongoing hostilities on private sector employers and workers in the West Bank, as well as their coping strategies; and

4. investigates the repercussions of the current crisis on the households of surveyed workers and their future coping strategies.

Based on its findings, this study proposes a set of policy recommendations to mitigate the impact of the war on workers and businesses in the West Bank, and to promote the creation of more and better sustainable jobs in the future.

The study employs various assessment methods, including two surveys – one administered electronically to employers, and one conducted through face-to-face interviews with private sector workers. Interviews were also conducted with self-employed individuals and key labour market stakeholders, such as representatives of the Ministry of Labour, the Palestinian Employment Fund and the Palestinian Monetary Authority.

The International Labour Organization (ILO) developed the study’s methodology, sampling, questionnaires and focus group interviews, as well as undertaking data cleaning and analysis, while data collection in the field was conducted in collaboration with the Palestinian General Federation of Trade Unions (PGFTU) for the workers’ survey, and with the Federation of Palestinian Chambers of Commerce, Industry and Agriculture (FPCCIA) for the employers’ survey.