The Political Economy of Nationality-Based Labor Inclusion Strategies: A Case Study of the Jordan Compact

Abstract:

In a setting of protracted refugee crises, donor responses increasingly have taken on experimental development approaches. One such aid experiment is that of the Jordan Compact, drafted in February 2016. This aimed to turn the Syrian refugee crisis in Jordan into a development opportunity, by fostering job creation and harvesting skills of displaced populations. This brought with it attention from donors in the form of political interest and, more importantly, funding, to stimulate the local economy and labor markets. However, the implementation of this plan was problematic: It focused only on stimulating jobs for Syrians and Jordanians, with little attention given to existing labor market dynamics and other employed nationality groups. Using a qualitative approach informed by both desk research and key informant interviews, this article shows that the policies undertaken have formed a nationality-based prioritization strategy that sought to improve Syrian labor market access over that of other non-Jordanians. The Compact did little to address genuine job creation or social protection, focusing on boosting permit numbers while worsening non-Syrian migrant and refugee access to protection in formal work.

Key Words:

• Aid policy
• EU refugee policies
• Jordan
• Labor market
• Syrian refugees

In a setting of protracted refugee crises—with displacements now averaging 26 years¹—and aid responses increasing in length, there has been a push for new frameworks surrounding aid in humanitarian crisis response.² These include plans that emphasize development over humanitarian maintenance aid, aiming to address better the needs of both refugees and host communities while adjusting to the protracted nature of the crisis. Although these increasingly are sold as ‘new’ responses, they have happened cyclically, with response and funding dependent on the interests of the many stakeholders involved.³

The European Union (EU) has been a financier of migration response plans globally in recent years, especially those in the Middle East and Africa. Increased reports of migration from Africa and Turkey via the Mediterranean resulted in what became known as a ‘migration crisis’, as reported in media outlets, prompting panic and emergence of right-wing activism.⁴ Europe responded to this crisis by financing migration control response plans, including the launch of the EU Trust Fund for Africa, which sought to support the coordination of migration management operations in Africa.⁵

Soon after came the EU response to the Syrian refugee crisis. Following increased movements of Syrians toward Europe in 2014, the German Foreign Ministry organized a conference that ultimately founded the MADAD Trust fund in Response to the Syria Crisis.⁶ In February 2016, donor states organized the ‘Supporting Syria and the Region Conference’ in London which resulted in billions of dollars in aid pledges. With this conference also came deals with countries hosting Syrian refugees, namely Jordan, Lebanon and Turkey. The plan with Jordan was unique and became known as the Jordan Compact, an experimental agreement that sought to turn the Syrian refugee crisis in Jordan into a ‘development opportunity’ for both Jordanians and Syrians. This was especially welcomed through job creation and labor integration policies for Syrian refugees in Jordan.⁷

This deal accompanied a donor-driven focus on funding related to creating opportunities for Syrian refugee labor inclusion. This aimed to ensure retention of the roughly 660,330 registered Syrian refugees⁸ in Jordan⁹ while simultaneously supporting Jordan’s response to the influx of Syrians. Yet the Jordan Compact policies, while heavy in labor market interventions, did little to address other existing non-Jordanian labor market segments. With the increased replication of ‘jobs compacts’ as a policy model to combat challenges with refugee hosting, as seen recently in Ethiopia,¹⁰ it is crucial to investigate their gaps and potential distortionary effects on local labor markets.

This article aims to shed light on the aid experiment in Jordan, specifically on the way Syrians have been integrated, and the impact on different nationality groups¹¹ in the labor market, including Jordanians, Egyptians, South Asians, and non-Syrian refugees. It argues that inclusion motivated by aid politics tied to Syrian refugees and Jordanian development priorities has distorted the labor market by way of ‘nationality-based labor prioritization’¹² policies that stratify Jordan’s labor market segments. These policies have taken the form of labor market nationalization through imposition of quotas to protect Jordanian citizens,¹³ as well as nationality-based preferential migrant work permit policies to minimize the presence of less-preferred foreign workers.¹⁴ These policies worsened the stratification of the labor market and limited access of non-Syrian migrants to formal work opportunities, especially in sectors in which they compete with Syrians.

The article firstly discusses the politics of refugee aid, the interplay of aid program incentives with recipient government development priorities, and existing labor market structures. It theorizes the ways these programs are supported by larger development goals while being constrained by host state labor market dynamics. Secondly, I introduce Jordan’s context by illustrating the complexities of its labor market and explaining the political and economic tensions at play in labor policy implementation, specifically regarding the inclusion of migrant workers. Thirdly, I outline the Jordan Compact work permit program and the Rules of Origin (RoO) agreement with the World Bank and EU that followed the Syrian refugee influx into Jordan, to demonstrate donor priorities and aid incentives at play—in association with Syrians. Lastly, I present and analyze the labor market policies undertaken since the launch of the Jordan Compact, how they were nationality-based, while tying these to aid politics and nationality-based aid incentives. This section demonstrates the differences in labor market policies by nationality, namely the ways different nationalities were prioritized or deprioritized in accordance with Jordanian development goals and donor priorities. Based on this, I argue that the Jordan Compact and its subsequent labor market implementation strategy has been a politically and economically motivated refugee aid policy, which drove the implementation of nationality-based labor prioritization strategies that worsened labor market stratification.

Politics of Refugee Aid

Refugee aid has been politically contingent in its dynamics and in the increasingly protracted nature of displacement. While crisis response aid often comes to mind in the event of humanitarian or natural disaster, the increasingly political and developmental nature of aid has begun to dominate aid relationships, with donor states increasingly forming long-term aid relationships with recipient states. Across several contexts, these politics are often contingent on a ‘grand compromise’: a dynamic between host states of the (often) Global South, and donors of the Global North that allows economically advanced states to shift the burden of refugee hosting to developing countries, all the while providing aid support.¹⁵

The Syrian refugee crisis introduced a new ‘grand compromise’ between Europe and refugee hosting states in the Middle East. The increasing number of Syrian refugees—topping the list for 2015 and 2016¹⁶—and arriving to Europe and Syria’s neighboring countries, motivated a series of regional aid deals with Jordan, Lebanon and Turkey. Although these deals differed in their priorities and implementation techniques, a common motif underpinned all of them: Funding in exchange for restrictions on migration flows to Europe.¹⁷ The deal with Jordan specifically emphasized Jordanian economic development, which was meant to be inclusive of Syrian labor.

Refugee Rentierism

Refugee aid politics paved the way for recipient governments to exhibit rent-seeking behavior by responding to aid incentives. The definition of a rentier state is one dependent on external clientele for extraction of rents from local resources. Jordan historically has been a state dependent on geostrategic rent, namely from the United States, due to its perceived security and military importance.¹⁸ However, rentierism in Jordan also has incorporated aid, and its hosting capacity has allowed it to resort to refugee rentierist behavior. In this text, ‘refugee rentierism’ is defined as ‘the phenomenon of using host status and refugee policy as primary mechanisms of international rent-seeking’.¹⁹ It is the use of refugee hosting as a method of extracting aid from foreign donors. In the midst of political issues in Europe vis-à-vis hosting of refugees, and the subsequent strengthening of far-right political actors, there was an added interest in refugee retention in initial host states.²⁰ This placed host states in a better position to negotiate aid conditions in line with their own development priorities.

Back-Scratching vs. Blackmailing²¹

Although all major host states were engaged in EU-supported migration responses, differences in geopolitical importance and size of refugee intake across the three states meant differing dynamics by which aid deals were brokered. These were either ‘…via blackmailing – threatening to flood a target state(s) with refugee populations within its borders, unless compensated – or via backscratching – promising to maintain refugee populations within its borders, if compensated’.²² The Turkish government undertook a blackmailing strategy between 2015 and 2016, utilizing its positioning as a port of departure to the EU, and the estimated 2.3 million Syrian refugees then within its borders.

Unlike Turkey, Jordan’s aid extraction from the EU did not involve the evocation of threats.²³ Rather, Jordan proposed a series of policy bargains that improved conditions for Syrian refugees in Jordan, particularly labor market access, education, and legal identification and documentation requirements. By emphasizing the burden of refugee hosting and the subsequent impact on Jordanian economic and political stability, the method engaged international cooperation that involved a trade-off: EU compensation for refugee hosting and Jordan policy concessions to improve living conditions for Syrian refugees.

Export-Oriented Industrialization

Aid politics and priorities in Jordan cannot be understood without contextualizing Jordanian interests in export-led development. Especially in an era of proliferation in global value chains, Jordan’s growth strategies prioritized the development of the manufacturing sector. In 2013, the Jordanian Ministry of Industry, Trade and Supply (MITS) launched the National Export Strategy for 2014–2019, with the aim of boosting Jordan’s exports and improving trade balances in a largely import-dependent economy.²⁴ Export driven strategies such as this have historically aimed to stimulate the production of manufactured goods to improve employment and growth through the establishment of backward linkages and the carving out of a niche in the global value chain.²⁵ This strategy increased in importance following the restricted and then full shutdown of trade routes with Syria from 2013 onward and which was destructive to the economy as the Syrian border was a major trade route that linked Jordan to both Lebanon²⁶ and Turkey.²⁷

New export-oriented industrialization (EOI) strategies in Jordan aimed to capitalize on existing trade agreements to incentivize foreign direct investment and local production. A longstanding free trade agreement with the United States, preceded by a 1997 agreement that loosened strict RoO requirements, successfully attracted Greater Chinese and South Asian investments to Jordan’s special economic zones (SEZ). This established for Jordan a significant place in the global garment value chain from the mid-1990s onward.²⁸ Nevertheless, this failed to boost Jordanian employment since these garment factories’ workers were largely migrant workers (73 percent in 2016).²⁹

Migrant Labor Marginalization

Although research around immigration and labor market structures tend to focus on the Global North, much of the theory also can be applied in the Jordanian context. In their analysis of labor market segmentation, Doeringer and Piore theorize two job tiers in the labor market: First is primary jobs, highly paid and stable; and the second tier is secondary jobs, which are low-paid and unstable. They theorize that nationals are less willing to take on secondary jobs due to social status. In the case of Jordan, much disinterest in manufacturing work has been due to low wages, distance from city centers and urban areas, and crucially, ‘cultures of shame’ around factory work.³⁰

As migrant communities have continued to grow, state policies have focused on deterring them from jobs preferred by Jordanians. These policies established not only a tiered labor market, but also ‘immigrant niches’ for these respective migrant groups, and consequently, migrant worker hierarchies.³¹ Immigrant niches are distinguished by the nature of the work in which migrants engage, normally secondary, precarious and low wage. While Jon Friberg and Arnfinn Midtboen argue that these niches are ethnicity-based, I argue that, in Jordan, they are nationality-based. Two main groups migrated prior to the Syrian refugee influx: Egyptian workers in agricultural, construction and service sectors; and South Asian workers of various nationalities in manufacturing—especially garments, and domestic work.³² The marginalization of workers in sectors dominated by foreign workers, and the increasing formation of ‘immigrant niches’ that establish hierarchies of working conditions by occupation, increasingly has deterred Jordanian employment due to precarious working conditions and weak labor protections and enforcement.³³

Special Economic Zones (SEZs)

Migrant workers make up the majority of workers in SEZs. Their work is marginalized, as it is distant from both urban areas and legal and activist spaces. According to Jauch, SEZs are marked by tax incentives in conjunction with lowered labor standards to attract foreign direct investment, leading to a global ‘race to the bottom’.³⁴ Factories in these zones often establish dormitories for migrant workers³⁵ to limit interaction with other urban spaces. Marginalization is also apparent in agriculture and construction work, sectors that attract largely migrant labor due to the informal and seasonal nature of work and daily wages.³⁶ Also, agricultural workers are excluded from the labor code, meaning their work is not covered by labor protections.³⁷

While SEZs are controversial in Jordan, in other countries, they have been spaces of worker unionization and empowerment.³⁸ The nature of the worker-employee relationship in Jordan, which utilizes the kafala sponsorship system, is to control the mobility of migrant worker populations.³⁹ The system subjects them to exploitation and threats of deportation if they try to form unions. All trade unions in Jordan need approval from a tripartite of government, employers and other trade unions, and no new unions have been formed since the late 1970s,⁴⁰ which discourages migrant worker collective action.

Refugee Camps

The influx of Syrian refugees in 2015 paved the way for other forms of labor exclusion through spatial marginalization that was not utilized in the response to Iraqi refugees in 2003. Unlike Iraqi refugees, Syrian refugees were placed in camps, notably Za’atari, Azraq and Emirati-Jordanian Camp, which respectively house nearly 80,000, 50,000 and 7,000 refugees.⁴¹ However, these three camps account for only 17 percent of Syrians in Jordan.⁴² By placing refugees in camps, these spaces ‘visibly’ represented the numbers of Syrian refugees in Jordan and thus the burden on the country, which the government exploited to obtain funding from international organizations.⁴³ The camps also are a way for host communities to portray a refugee crisis as temporary, and as a way to avoid long-term integration.⁴⁴ This approach contrasts with the strategy undertaken when hosting Iraqi refugees in 2003, as the latter were integrated into urban spaces rather than camps.

Political Economy of Jordan’s Labor Market Nationalisation

Work Permit Program and EU Rules of Origin

Perhaps the most groundbreaking aspect of the Jordan Compact was not the forging of a multilateral aid partnership, but the trade concession agreement that came in tandem with it. After the ‘Supporting Syria and the Region Conference’ in February 2016, the European donor states and Jordan reached an agreement concerning funding of Syrian refugee needs in Jordan, including the provision of jobs. The Jordan Compact labor agreement can be examined in two parts: Work permit targets; and trade incentives associated with Syrian labor.

The work permit program incentivized the inclusion of Syrian refugees in the workforce. The initial target of Syrian refugee job creation was 200,000.⁴⁵ This number was tied to soft loans under the World Bank Program-for-Results (P4R). The final target could be met over several years, with annual targets tied to permit issuance.⁴⁶ Achievement of this target is necessary for meeting conditions for World Bank concessionary loans.

This agreement framed the crisis as a development opportunity for both Jordanians and Syrians. However, the agreement’s aid incentives strongly dictated labor market policies, which meant that reaching work permit program targets was highly prioritized in the face of other important policy changes that impacted Syrian refugees in Jordan.⁴⁷

Instead of offering automatic right to work for Syrian refugees, the Jordanian government instead offered labor inclusion by way of sector-specific work permits with fee waivers.⁴⁸ The target of 200,000 was interpreted as being the number of work permits issued to Syrian refugees. Thus, rather than resorting to job creation rates, work permit issuance and renewal counts more conveniently were used to represent the ‘economic opportunities’ meant to be created for Syrian refugees.⁴⁹ It is noteworthy that at this stage, the Compact also sought to create 1 million jobs for Jordanians⁵⁰ – although this has since been abandoned in practice. This ‘plan’ arguably acted as a temporary mitigation strategy for Jordanian nationals who resented Syrian refugee integration for fear of losing their jobs to them, especially in a period of economic decline.

A July 2016 update of the existing Association Agreement between Jordan and the EU also complimented the work permit target for Syrian refugees. This further liberalized the trade relations in the agreement by simplifying the Rules of Origin (RoO) and was completed following the London Donor Conference in February. These terms applied to specified manufactured goods across 52 product categories⁵¹ including textiles and garments, engineering and electrical products and chemical products, as long as Syrian labor comprised at least 15 percent of their production. This agreement initially stipulated that the Syrian contribution quota would increase to 25 percent two years after implementation, which would be at the end of 2018. The aim was to increase incentives to employ Syrian refugees by easing Jordanian factory owners’ access to European markets.

However, these relaxed RoO only were meant to be applied on goods produced in any of Jordan’s eighteen designated SEZs. This limited the sectors to target Syrian refugee employment to benefit from the simplified RoO, as well as the production and goods sent for export to the EU. Factories outside Jordan’s SEZs were to receive access to these only after the Jordanian government reached its work permit issuance target of 200,000, thus increasing incentives to expand formal Syrian refugee employment.

By way of facilitating access for Jordanian factories to export to European markets, a new source of demand was created–in theory--for Jordanian goods. If successful, this market expansion would scale up investments and job creation to meet demands for new markets. Since Syrian refugees were needed for this to occur, this would be an important source of refugee employment. This ties into the work permit target of 200,000, to which the manufacturing sector was expected to contribute significantly by way of job creation through new investments and market access. While it was not necessary that these permits be in manufacturing, the quota for EU RoO waivers supposedly would act as an entry point for Syrian employment in Jordan’s labor market.⁵²

After the Jordan Compact agreement was reached, a series of measures were put in place to ease the process of employing refugees across a number of specified sectors, primarily agriculture, construction and manufacturing.⁵³ These measures began with the implementation of a work permit ‘grace period’ for Syrian refugees during which work permit fees were waived. This initial period began in April 2016 and lasted for three months. Ministry of Labor directorates disseminated authority over agricultural work permit distribution to agricultural cooperatives throughout Jordan.⁵⁴ Currently, Jordan is in its tenth work permit grace period extension, which will expire in December 2021.⁵⁵

Jordan’s (formal) migrant labor all work under the previously mentioned kafala system. However, following a series of reports that detailed refugees’ issues with being tied to a sponsor, freelance permits were issued to refugees to sponsor themselves for employment. This first took place in the agricultural sector, which also explained the high work permit count in this sector when the permit grace periods first were launched.⁵⁶ Freelance permits in the construction sector were allowed in July 2017.⁵⁷ In the following months, there was a spike in permit applications and construction permits by Syrians increased 98 percent compared to the previous year.⁵⁸ Further, policy changes in 2017 allowed Syrians to switch their work permit sectors and employers without clearance, in the event that their permits expired.⁵⁹ Although this change is seemingly small, Jordanian law continues to be strict about migrant workers shifting employers and work permit sectors. The MoL also introduced short-term permits with duration less than one year; these specifically were issued for Syrians working in cash-for-work programs⁶⁰ run by INGOs.⁶¹

All these measures show consistent attempts to facilitate availability of permits to Syrian refugees. By easing processes for Syrian refugees to access work permits, applications for permits increased. Since the total permits issued counted toward the goal of 200,000 economic opportunities provided to Syrian refugees, there existed incentives for the GoJ to improve the issuance of permits by easing the process and lowering costs, on increasingly short permit durations by mandating that Syrian cash-for-work program volunteers must be issued work permits. These formalization measures must be contextualized within a policy motive that was specific to Syrian refugees. Early reports on issues with work permit acquisition showed that refugees did not have particular incentives to acquire permits as they did not provide formal work benefits.⁶² However, freelance permits do not require social security payments, meaning that access to workplace insurance and other protective services are limited. Rather, the increase in the number of permits issued was more prioritized in Syrian labor market policymaking in Jordan, instead of the realistic level of protection or other benefits it offered to formally employed refugees.⁶³

Exceptionalism of Syrians in Post-Jordan Compact Policy-Making

All these changes have reflected a willingness for the MoL to compromise on their work permit system that has been challenging for migrant workers, in accordance with ILO early recommendations to prioritize Syrian access to work permits over other migrants.⁶⁴ These issues mainly are associated with the exploitative nature of being tied to an employer. These include risk of deportation, extended work hours, and limited pay—all with very few avenues for legal redress due to fear of work permit cancelation or being reported to the MoL.⁶⁵

The issuance of freelance permits has been exclusive for Syrian refugees. Similarly, changes that allow switching permits to different sectors, allow fee waivers and other changes are benefits offered only to Syrian workers. Syrian work permits have strayed significantly far from other migrant work permits, proven by the Ministry of Labor’s circulation of ‘Instructions for Employment of Syrians’ in 2018. These have been effective in increasing permit issuance numbers: in 2015, prior to the program, only 5,307 Syrians held work permits in Jordan.⁶⁶ As of December 2018, this number officially⁶⁷ was estimated at 40,000 active permits.⁶⁸ The total number of permits issued to Syrians, including renewals, since the implementation of the program in 2016 stands at 215,668,⁶⁹ now exceeding the initial goal⁷⁰ of 200,000.

Labor Market Stratification

The changes in policy surrounding the labor integration of Syrian refugees in Jordanian labor markets marked a clear pattern in labor policy in Jordan. This was a nationality-based preference in migrant labor policy in Jordan, complimented by Jordanian employment protection efforts that acted as a buffer between the mass surplus of migrant labor brought by Syrians and the declining job creation in Jordan in a time of economic slowdown. The following describes the ways Syrian refugees have been used as a resource for donor and recipient governments to stimulate the (appearance of) inclusion of refugees, and the receipt of aid while also guaranteeing the inclusion of Jordanians in refugee job development programs. Further, it describes the impacts that these prioritization processes had on the stratification of the labor market, particularly on nationality segments that were de-prioritized and marginalized in these policy changes.

Syrians

The use of separation by geographic space is a strategy employed in the initial plans developing the Jordan Compact and RoO agreement, whereby Syrian refugee employment only was incentivized by quotas on products manufactured in SEZs, the majority of which are located in remote areas. These incentives, combined with significant tax breaks for producers in SEZs,⁷¹ all contributed to the creation of policy space that redirected Syrian refugee employment to manufacturing. Ultimately, the mass influx of refugees was meant to act as a new source of labor to manufacture products for export.

However, there also existed incentives to issue permits to refugees outside the zones, meaning that policy changes extended beyond those boundaries. The Ministry of Labor has a Syrian Employment Unit dedicated to Syrian work permit affairs and negotiating relaxation of bureaucracies associated with acquiring permits, but such help is not available for other non-Jordanian populations. Permit issuance has been successful: Syrians accounted for less than 2 percent of permits issued to foreign workers in 2015⁷² and increased to 11 percent in 2019.⁷³ Syrians are a source of aid revenue for Jordan due to EU policies that incentivized the containment of Syrian refugee movements in countries of first arrival.⁷⁴ However, the lack of advocacy for refugees of other nationalities in Jordan reflected EU policy priorities in aid conditionality tied to labor market inclusion. For instance, mandated reductions in foreign employment in the agriculture, construction and manufacturing sectors temporarily exclude Syrian refugees, rerouting the reductions to other foreign workers.⁷⁵ These exclusions were important given Syrian uptake for the agriculture and construction sectors, which made up 34 percent and 30 percent respectively of permits issued to Syrians in 2017.⁷⁶ Further, Syrians were excluded entirely from reductions in the manufacturing sector,⁷⁷ showing that the targets for this policy were South Asian and Egyptian workers, who make up the largest employment nationality groups in these sectors.

These nationality-based labor policies extended to laws that passed in November 2018 to support home-based business legislation meant to enhance Syrian women’s participation in Jordan’s labor market.⁷⁸ While this is a positive step forward for women’s economic participation in Jordan, like all other labor policies related to the Jordan Compact, it is a nationality-exclusive policy that acted as a policy concession for aid purposes. The creation of the work permit program and the subsequent facilitation of permits for Syrian employees with little effort made to improve working conditions or stimulate job creation, suggests that the motivations for work permit issuance were aligned with donor-set aid. The P4R incentivized the government to boost numbers of permits. Thus, they effectively acted as a key performance indicator for Syrian employment, rather than job activity or work quality.⁷⁹ Consequently, donor willingness to accept these as an indicator of refugee employment and of government willingness to include refugees in the economy, led to implementing these prioritization policies that distort the migrant labor market. Concurrently, these policies do little to ensure decent work or protection of other non-Syrian foreign workers.

These different changes in labor market policies reflect a prioritization strategy that showcased both the interests of the Jordanian government in protecting national workers and promoting EOI, and that of the donor community (especially those in the EU) to include Syrian refugees in the Jordanian workforce. While improving access to the labor market for Syrians over migrant workers was acceptable to the government, it was important that their access did not exceed that of Jordanians.⁸⁰ A slow rate of job creation also further allowed for the prioritization and attempted replacement of Syrian workers for workers of other nationalities through preferential labor policies. While not a labor policy per se, it is noteworthy that annual migrant worker deportations nearly doubled after the Compact, from 5,375 in 2015 to 9,448 in 2017.⁸¹ These actions were an (ineffective) replacement of migrant workers with Syrians, to deter expansion of the non-Jordanian workforce against low job creation.

Notably, there were very few changes made to manufacturing work permit policies since the Compact, aside from the fee waivers for Syrians and annual foreign workforce reductions. While these are active efforts to reduce foreign employment in these sectors, the employer-designated immigrant niches associated with those of South Asian nationalities turned away further restrictions on foreign work recruitment such as those placed in the agricultural sector. Policies in manufacturing ultimately sought to improve Syrian inclusion rather than deprioritize South Asian work, as employers preferred the latter while the government wanted to protect the manufacturing sector’s production and exports.⁸²

Similarly, aid incentives and the desire to develop Jordan’s manufacturing sector strengthened implementation of these policies. While non-Syrian refugees make up a relatively small group altogether, they were excluded from the labor policy changes made for Syrian refugees. The labor market changes did not work to de-prioritize them as they did for Egyptians, but instead sought to overlook them completely, similar to government stances taken on informal Syrian refugee work prior to the Jordan Compact. Existing nationality-based segmentations in Jordan’s labor market allowed the implementation of nationality-based labor prioritization policies. Incentives tied to inclusion of Syrian nationals were developed in tandem with protections for Jordanian citizens. Continued enactment of policies that restricted their access to income opportunities further marginalized migrant workers and resulted in a nationality-based stratification of the labor market.

Conclusion

The Jordan Compact resulted in policies that sought to prioritize labor market access by nationality. While nationality segmentations in Jordan existed before the Compact, the policies undertaken to achieve its aims prioritized and deprioritized these segmentations in accordance with political and economic gains associated (or not) with each of these nationalities. A range of factors, including aid incentives, political constraints, and slow job creation ultimately motivated the subsequent series of labor decisions that comprised a nationality-based labor prioritization strategy.

Labor market nationality-based prioritization strategies have been present in Jordan and across the region in the form of workforce nationalization programs. However, the extension of these policies into nationality-based migrant labor laws is a unique dynamic that the Jordan Compact and its associated incentives prompted. This is not to say that the policies were successful in replacing or even stifling migrant worker flow. Rather, it worsened the marginalization of migrant workers, especially those who compete with Syrians for jobs. By fostering the creation of nationality-based migrant labor policies that operate in parallel with each other, migrant vulnerability is exacerbated. Not only did the policies fail to achieve the intended numbers of Syrian workforce inclusion, they informalized migrant workers instead of reducing their presence.

The stratification of Jordan’s labor market is a result of aid-motivated policies that responded to the needs of donors and to the Jordanian government’s economic development priorities. The Jordan Compact’s funding had varying impacts on the different segments in the labor market, but the lack of a direct policy aim or incentive concerning the considerably large population of non-Syrian migrants in Jordan left them impacted with the ‘residue’ of policies that aimed to boost Jordanian and Syrian refugee employment. The implementation of the Compact became a series of attempted labor replacement strategies that increased bureaucracies on Egyptian workers’ access to the Jordanian job market. South Asian workers initially had been targeted for replacement, but lack of interest among Syrians in the sector—or employer interest for that matter—shows that they likely would not be as impacted. The Compact’s lack of a holistic understanding of labor market dynamics in Jordan not only prevented the success of the aid experiment, but also exacerbated vulnerability among migrant labor communities in Jordan.

Acknowledgments

The research for this article initially was conducted to fulfill requirements for my master’s thesis while at School of Oriental and African Studies (SOAS), University of London. I wish to thank my supervisor, Dr. Tim Pringle, for his support during the process of formulating the research question and methodology. I also thank Julius Kloeckner for his support and the hours he dedicated to honest feedback and edits, and Maryam Mushtaq for her patience in reading earlier drafts and sharing her thoughts on my research. Lastly, I would like to thank my parents for the support they gave throughout my masters’ program, without which I could not have pursued this research.

Notes

1 UNHCR (2016) Global Trends: Forced displacement in 2015 (Geneva: United Nations High Commissioner for Refugees), p. 20.

2 Alexander Betts & Paul Collier (2015) Help Refugees Help Themselves: Let Displaced Syrians Join the Labor Market, Foreign Affairs. Available at https://www.foreignaffairs.com/articles/levant/2015-10-20/help-refugees-help-themselves, accessed August 15, 2019.

3 Jeffrey Crisp (2006) Mind the Gap! UNHCR, Humanitarian Assistance and the Development Process, International Migration Review, 35(1), pp. 168–191.

4 Michael Collyer & Russell King (2016) Narrating Europe's migration and refugee ‘crisis’, Human Geography, 9(2), p. 4.

5 European Commission (2015) The European Union Emergency Trust Fund for Stability and Addressing the Root Causes of Irregular Migration and Displaced Persons in Africa (Brussels: Strategic Orientation Document).

6 Marc Pierini & Jonathan Hackenbroich (2015) A Bolder EU strategy for Syrian Refugees. (Carnegie Europe). Available at https://carnegieeurope.eu/2015/07/15/bolder-eu-strategy-for-syrian-refugees-pub-60712?fbclid=IwAR3vxpq9-Hw_SJ-NDkjwhXveoiHMfopEazMUbgXV5Csw7fzPn4Og9Gatkc, accessed August 15, 2019.

7 Daniel Howden, Hannah Patchett & Charlotte Alfred (2017) The Compact Experiment: Push for Refugee Jobs Confronts Reality of Jordan and Lebanon, Refugees Deeply. Available at http://issues.newsdeeply.com/the-compact-experiment, accessed August 15, 2019.

8 UNHCR (2019a) Jordan Factsheet - January 2019, Amman: United Nations High Commissioner for Refugees. Available at https://reliefweb.int/sites/reliefweb.int/files/resources/67841.pdf, accessed August 15, 2019.

9 For further analysis on refugee retention in Global South host states and the role of the Jordan Compact in this, see: Rawan Arar (2017) The New Grand Compromise: How Syrian Refugees Changed the Stakes in the Global Refugee Assistance Regime, Middle East Law and Governance, 9(3), pp. 298–312.

10 Veronique Barbelet, Eva Ludi, Jessica Hagen-Zanker, Freddie Carver & Dirk Willem te Velde (2019) How to Ensure Ethiopia’s ‘Jobs Compact’ Works for Refugees, Refugees Deeply. Available at https://www.newsdeeply.com/refugees/community/2019/01/14/how-to-ensure-ethiopias-jobs-compact-works-for-refugees, accessed August 15, 2019.

11 The author acknowledges the importance of gender-based segmentation in labor market access, however this has been covered thoroughly elsewhere; see, for example, Turner (2019) Three Years of the Jordan Compact: The (Gendered) Challenges of Providing Work Permits for Syrian Refugees, in LSE Blogs, 12 July; C. Dupire (2018a) Refugee Women ‘Worse Off’ Two Years into Jordan Compact—Report, The Jordan Times, 11 September; S. Almasri (2018) Tailor Made: How Syrian Refugee Women Are Finding Their Own Way to Join the Jordanian Economy (Amman: Oxfam); and UN Women (2017) Women Working: Jordanian and Syrian Refugee Women's Labour Force (Brief) (Amman: UN Women).

12 I coined this term due to a lack of an umbrella term to describe nationality-based labor strategies.

13 Erica Harper (2018) Unpacking and Repacking the Refugees Compact Experiment: Lessons from Jordan Two Years On (Amman: WANA Institute), p. 5.

14 Alison Hartnett (2018) The Effect of Refugee Integration on Migrant Labor in Jordan, Review of Middle East Studies, 52(2), p. 275.

15 Mariano-Florentino Cuéllar (2006) Refugee Security and the Organizational Logic of Legal Mandates, Georgetown Journal of International Law, 37, pp. 623–627.

16 Rawan Arar (2017) The New Grand Compromise: How Syrian Refugees Changed the Stakes in the Global Refugee Assistance Regime, Middle East Law and Governance, 9(3), p. 306.

17 Ibid.

18 Phillip Robins (2004) A History of Jordan (New York: Cambridge University Press), p. 204.

19 Vicky Kelberer (2017a) Negotiating Crisis: International Aid and Refugee Policy in Jordan, Middle East Policy, 24(4), p. 157

20 Peter Seeberg & Musa Shteiwi (2017) Introduction: New Challenges for the European Union in the Arab Mediterranean and the Revision of the European Neighbourhood Policy, European Foreign Affairs Review, 22(1), p. 9.

21 This section draws heavily on Gerasimos Tsourapas (2019) The Syrian Refugee Crisis and Foreign Policy Decision-Making in Jordan, Lebanon, and Turkey, Journal of Global Security Studies, 4(4), pp. 1–18.

22 Ibid, p. 2.

23 Rawan Arar (2017) The New Grand Compromise: How Syrian Refugees Changed the Stakes in the Global Refugee Assistance Regime, Middle East Law and Governance, 9(3), p. 308.

24 MITS (2013) National Export Strategy 2014-2019 (Amman: Ministry of Industry, Trade and Supply). Available at http://inform.gov.jo/en-us/By-Date/Report-Details/ArticleID/56, accessed July 12, 2019.

25 Hans Linnemann, Harmen Verbruggen, & Pitou van Dijck (1987) Export-Oriented Industrialization in Developing Countries (Manila: National University Singapore Press), p. 145.

26 Massimiliano Cali (2015) How has Syria’s civil war affected trade in neighbouring countries? World Economic Forum. Available at https://www.weforum.org/agenda/2015/04/how-has-syrias-civil-war-affected-trade-in-neighbouring-countries/, accessed August 15, 2019.

27 Raed Omari (2015) Jordan’s agricultural exports key victim of Syria crisis, The Jordan Times, 27 August. Available at https://www.jordantimes.com/news/local/jordan’s-agricultural-exports-key-victim-syria-crisis, accessed August 15, 2019.

28 Shamel Azmeh & Khalid Nadvi (2013) ‘Greater Chinese’ Global Production Networks in the Middle East: The Rise of the Jordanian Garment Industry, Development and Change, 44(6), p. 1318.

29 Better Work Jordan (2017) Examining Barriers to Workforce Inclusion of Syrian Refugees in Jordan (Amman: International Labor Organisation), p. 39.

30 Laila Azzeh (2014) Culture of shame, low salaries driving Jordanians away from industry sector jobs, The Jordan Times, 23 October. Available at http://www.jordantimes.com/news/local/culture-shame-low-salaries-driving-jordanians-away-industry-sector-jobs%E2%80%99, accessed August 15, 2019.

31 Jon Horgen Friberg & Arnfinn H. Midtboen (2018) The Making of Immigrant Niches in an Affluent Welfare State, International Migration Review, 53(2), pp. 322–345.

32 Despite making up 20% of migrant work, I do not cover the domestic work sector due to its exclusion from the Jordan Compact labor policies, as it was perceived be an inappropriate sector for Syrian women’s inclusion (Author Skype Interview with academic researcher, 24 June 2019). See also Susan Razzaz (2017) A Challenging Market Becomes More Challenging (Beirut: International Labour Organisation), who reports South Asian workers collectively because they compete for work in similar occupations and conditions; They are Indians, Pakistanis and Sri Lankans.

33 Camille Dupire (2017) Jordanian labour market suffers from ‘abundant’ foreign workforce—study, The Jordan Times. 5 October. Available at http://www.jordantimes.com/news/local/jordanian-labour-market-suffers-abundant%E2%80%99-foreign-workforce-%E2%80%94-study, accessed August 15, 2019.

34 Herbert Jauch (2002) Export processing zones and the quest for sustainable development: A Southern African perspective, Environment and Urbanization, 14(1), p. 106.

35 Katharina Lenner & Lewis Turner (2018) Making Refugees Work? The Politics of Integrating Syrian Refugees into the Labor Market in Jordan, Middle East Critique, 28(1), p. 18.

36 Ana V. Ibáñez Prieto (2018) Jordan Labour Watch calls for halting amendment to Labour Law, The Jordan Times. 19 February. Available at http://www.jordantimes.com/news/local/jordan-labour-watch-calls-halting-amendment-labour-law, accessed August 15, 2019.

37 Jordan Labor Code, Law No. 8 of 1996 (Dated March 2, 1996).

38 Chris Smith & Ngai Pun (2006) The Dormitory Labour Regime in China as a Site for Control and Resistance, The International Journal of Human Resource Management, 17(8), pp. 1465–1467.

39 Susan Razzaz (2017) A Challenging Market Becomes More Challenging (Beirut: International Labour Organisation), p. 41.

40 Ana V. Ibáñez Prieto (2018) Jordan Labour Watch calls for halting amendment to Labour Law, The Jordan Times. 19 February. Available at http://www.jordantimes.com/news/local/jordan-labour-watch-calls-halting-amendment-labour-law, accessed August 15, 2019.

41 UNHCR (2019b) Syria Regional Refugee Response: Interagency Information Sharing Portal (Geneva: United Nations High Commissioner for Refugees). Available at http://data.unhcr.org/syrianrefugees/regional.php., accessed August 15, 2019.

42 UNHCR (2019a) Jordan Factsheet - January 2019 (Amman: United Nations High Commissioner for Refugees); available online at: https://reliefweb.int/sites/reliefweb.int/files/resources/67841.pdf, accessed August 15, 2019.

43 Lewis Turner (2015) Explaining the (Non-)Encampment of Syrian Refugees: Security, Class and the Labour Market in Lebanon and Jordan, Mediterranean Politics, 20(3), p. 388.

44 Adam Ramadan (2013) Spatialising the refugee camp, Transactions of the Institute of British Geographers, 38(1), p. 65.

45 Estimates of 160,000 informally employed Syrians at the time helped in formulating this target, according to Ali Fakih & May Ibrahim (2016) The Impact of Syrian Refugees on the Labor Market in Neighboring Countries: Empirical Evidence from Jordan, Defence and Peace Economics, 27(1), p. 67.

46 This is a soft loan program tied to ‘Disbursement-Linked Indicators’ that set outcomes as conditions for loan disbursement; see The World Bank (2016b) Jordan - Economic Opportunities for Jordanians and Syrian Refugees Program for Results Project, p. 11. Available at http://documents.worldbank.org/curated/en/802781476219833115/pdf/Jordan-PforR-PAD-P159522-FINAL-DISCLOSURE-10052016.pdf, accessed August 5, 2019.

47 Author Interview, Jordanian government official, Amman, July 24, 2019.

48 Author Interview, former World Bank consultant, Amman, August 15, 2019.

49 Author Interview, INGO employee, Amman, August 6, 2019.

50 Vicky Kelberer (2016) Putting Refugee Permits to Work, Middle East Report, no. 278. Available at http://www.bu.edu/pardeeschool/files/2016/06/kelberer278.pdf, accessed August 15, 2019.

51 The 52 products are listed at: Ministry of Industry, Trade and Supply (2016) Simplification of EU Rules of Origin (Amman: Ministry of Industry, Trade and Supply). Available at https://www.jic.gov.jo/wp-content/uploads/2018/11/V9-English-Pamphlet-For-Website-Reduced.pdf, accessed July 31, 2019.

52 Veronique Barbelet, Jessica Hagen-Zanker, & Dina Mansour-Ille (2018) The Jordan Compact: Lessons learnt and implications for future refugee compacts. Overseas Development Institute, p. 2.

53 Victoria Kelberer (2017b) The Work Permit Initiative for Syrian Refugees in Jordan: Implications for Policy and Practice. Boston Consortium of Arab Region Studies, p. 11. Available at https://www.bu.edu/pardeeschool/files/2017/02/Vicky1.pdf, accessed August 15, 2019.

54 Alisa Reznick (2016) Syrian worker program faces hurdles in Jordan, AlJazeera, 23 September. Available at https://www.aljazeera.com/news/2016/09/syrian-worker-programme-faces-hurdles-jordan-160919073944811.html, accessed August 3, 2019.

55 UNHCR (2021) Legal analyses on MOL extension on grace period and Work Permits fees for Syrians in Jordan. Available at https://data2.unhcr.org/en/documents/details/84568, accessed February 19, 2021.

56 Alisa Reznick, Syrian worker program.

57 ILO (2017a) Jordan Issues First-of-Their-Kind Work Permits to Syria Refugees in the Arab Region [Press release] 9 August (Amman: International Labor Organisation). Available at https://www.ilo.org/global/about-the-ilo/newsroom/news/WCMS_568722/lang--en/index.htm, accessed August 20, 2019.

58 Ministry of Labor (2017a) Syrian Refugee Unit Work Permit Progress Report November 2017 (Amman: Ministry of Labor).

59 Ana V. Ibanez Prieto (2018c) 108,000 work permits issued for Syrian refugees since onset of crisis, The Jordan Times, 13 August. Available at http://www.jordantimes.com/news/local/108000-work-permits-issued-syrian-refugees-onset-crisis, accessed August 18, 2019.

60 A cash-for-work program is run by an NGO, usually an international one, and it employs vulnerable people as paid volunteers for short-term projects.

61 See Ministry of Labor (2018b) Syrian Refugee Unit Work Permit Progress Report, December 2018 (Amman: Ministry of Labor). These permits are mentioned in a footnote in this document. However, these permits were difficult to issue and did not enjoy much success in practice.

62 ILO (2017b) Work Permits and Employment of Syrian Refugees in Jordan: Towards Formalizing the Work of Syrian Refugees (Amman: International Labor Organization), p. 55. Available at: https://www.ilo.org/wcmsp5/groups/public/---arabstates/---ro-beirut/documents/publication/wcms_559151.pdf, accessed August 17, 2019.

63 Author Skype Interview with academic researcher, 24 June 2019.

64 ILO (2015) Access to work for Syrian refugees in Jordan: A discussion paper on labor and refugee laws and policies, International Labor Organization, p. 24. Available at: https://www.ilo.org/wcmsp5/groups/public/---arabstates/---ro-beirut/documents/publication/wcms_357950.pdf, accessed August 14, 2019.

65 Susan Razzaz (2017) A Challenging Market Becomes More Challenging (Beirut: International Labor Organization), p. 12.

66 Ministry of Labor (2015) Annual Report 2015 (Amman: Ministry of Labor), p. 106.

67 Tareq AlDaja (2018) AlHammouri: Brussels Agreement Reduces Syrian Employment Condition to 15% [in Arabic], Al Ghad, 18 December. Available at https://alghad.com/الحموري-اتفاق-بروكسل-يخفض-شرط-ت/, accessed August 15, 2019.

68 According to an interviewed former government official, the actual estimate for active permits often fluctuated between 30,000 and 32,000; Author interview with Jordanian government official, Amman, 24 July 2019.

69 Ministry of Labor (2020) Syrian Refugee Unit Work Permit Progress Report, December 2020 (Amman: Ministry of Labor).

70 The Jordan Compact deal was renegotiated in December 2018. The EU gave some concessions on trade terms, but the permit goal was changed from 200,000 total permits to 60,000 active permits. See more in Cindy Huang & Katie Gough Huang (2019) The Jordan Compact: Three Years on, Where Do We Stand? Center for Global Development, 11 March. Available at https://www.cgdev.org/blog/jordan-compact-three-years-on, accessed August 18, 2019.

71 Maria Mikadze & Shaddin Alhajahmad (2017) Investment and Business in Jordan to Create Employment: Opportunities and Challenges (Amman: WANA Institute), p. 11.

72 Ministry of Labor (2015) Annual Report 2015 (Amman: Ministry of Labor).

73 Ministry of Labor, (2019) Annual Report 2019 (Amman: Ministry of Labor), p. 21.

74 Peter Seeberg & Musa Shteiwi (2017) Introduction: New Challenges for the European Union in the Arab Mediterranean and the Revision of the European Neighborhood Policy, European Foreign Affairs Review, 22(1), p. 9.

75 Livelihood Working Group (2017) Minutes of Livelihood Working Group Meeting, 7 November 2017 (Amman: United Nations High Commissioner for Refugees, EMOPS room).

76 Shaddin Alhajahmad & Dorsey Lockhart (2017) Statistics Brief: Syrian Refugee Employment Trends in Jordan (Amman: WANA Institute, Royal Scientific Society), p. 5.

77 Ministry of Labor (2018b) Syrian Refugee Unit Work Permit Progress Report December 2018 (Amman: Ministry of Labor).

78 Jordan INGO Forum (2019) JIF Briefing Paper for the London Initiative (Amman: Jordan INGO Forum & Norwegian Refugee Council). Available at http://jordaningoforum.org/2019/02/18/position-paper-jif-london-initiative-for-jordan/, accessed August 15, 2019.

79 Maha Kattaa & Meredith Byrne (2018) Quality of work for Syrian refugees in Jordan, Forced Migration Review, 58, pp. 45–46.

80 Author Interview with Jordanian government official, Amman, 24 July 2019.

81 Author Interview with NGO employee, Amman, 27 August 2019.

82 This is not to say that the policies were successful: only eleven companies in Jordan registered to benefit from relaxed RoO, and they only employ 292 Syrians in total, according to Agulhas (2019) Assessment, p. 14.