Identifier
Created
Classification
Origin
09ASHGABAT299
2009-03-05 12:51:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Ashgabat
Cable title:
TURKMENISTAN: UNEMPLOYMENT STILL THE ELEPHANT IN THE ROOM
VZCZCXRO0642 PP RUEHAG RUEHAST RUEHBI RUEHCI RUEHDBU RUEHDF RUEHIK RUEHLH RUEHLN RUEHLZ RUEHNEH RUEHPW RUEHROV RUEHSK RUEHSR RUEHVK RUEHYG DE RUEHAH #0299/01 0641251 ZNR UUUUU ZZH P 051251Z MAR 09 FM AMEMBASSY ASHGABAT TO RUEHC/SECSTATE WASHDC PRIORITY 2413 INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE PRIORITY RUCNCIS/CIS COLLECTIVE PRIORITY RUCNMEM/EU MEMBER STATES COLLECTIVE PRIORITY RUEHAK/AMEMBASSY ANKARA PRIORITY 4899 RUEHBJ/AMEMBASSY BEIJING PRIORITY 2663 RUEHKO/AMEMBASSY TOKYO PRIORITY 2528 RUEHIT/AMCONSUL ISTANBUL PRIORITY 3143 RHMFIUU/CDR USCENTCOM MACDILL AFB FL PRIORITY RUEAIIA/CIA WASHDC PRIORITY RHEFDIA/DIA WASHDC PRIORITY RUEKJCS/JOINT STAFF WASHDC PRIORITY RHEHNSC/NSC WASHDC PRIORITY RUEKJCS/SECDEF WASHDC PRIORITY RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY RUEATRS/DEPT OF TREASURY WASHDC PRIORITY RUEHRC/DEPT OF AGRICULTURE WASHDC PRIORITY
UNCLAS SECTION 01 OF 03 ASHGABAT 000299
SENSITIVE
SIPDIS
STATE FOR SCA/CEN, EEB
E.O. 12958: N/A
TAGS: PGOV SOCI ECON TX
SUBJECT: TURKMENISTAN: UNEMPLOYMENT STILL THE ELEPHANT IN THE ROOM
UNCLAS SECTION 01 OF 03 ASHGABAT 000299
SENSITIVE
SIPDIS
STATE FOR SCA/CEN, EEB
E.O. 12958: N/A
TAGS: PGOV SOCI ECON TX
SUBJECT: TURKMENISTAN: UNEMPLOYMENT STILL THE ELEPHANT IN THE ROOM
1. (U) Sensitive but unclassified. Not for public Internet.
2. (SBU) SUMMARY: Unemployment is still a major problem in
Turkmenistan. President Berdimuhamedov's mandates, such as ending
reductions in personnel in order to pay for wage increases and the
reinstatement of ten years of schooling, have helped to slow the
growth of unemployment. However, Berdimuhamedov has not yet offered
any concrete ideas for reducing unemployment. Unemployment appears
to be especially acute among those aged 16-24 and among rural
residents. Locals assess that the government has done little to
create new jobs, and its modest efforts to help people find jobs has
been corrupted by opportunism. Even foreign businesses provide only
a modicum of largely temporary relief for the problem, which seems
destined to grow. Promoting the development of more small- to
medium-sized private businesses and allowing a more fertile
environment for them to grow would help ease the stresses that
unemployed youth could potentially put on this society. END
SUMMARY.
GROWING POOL OF YOUNG AND UNEMPLOYED
3. (SBU) The central government continues to be the most
significant employer for Turkmenistan's population. Seventy to
eighty percent of the employed population is thought to be working
in the public sector. Government statements in recent years suggest
that some twenty percent of the workforce is in the private sector
or self-employed. Official unemployment statistics have not been
published in 13 years, however, making it difficult to evaluate such
statements. The last official survey, conducted in 1995,
implausibly assessed unemployment to be three percent. A 2006 Asian
Development Bank report estimated that unemployment in the country
was more than 50 percent. Local residents consider the most
vulnerable category of the population to be the 16-24 year old age
group in both urban and rural areas. The Ministry of Education
reported that some 115,000 students graduated from high school in
2008. Our Public Diplomacy office, through its work on education
programs, estimates that about 30,000 are enrolled in universities
here and abroad annually. Using these figures, it is possible to
deduce that some 70,000 young people are entering the country's
labor pool annually, equipped with a high school education.
According to a Ministry of Education report presented at the Central
Asian Republics and Kazakhstan (CARK) Education Forum in Dushanbe on
June 7-8, 2005, only about 11 percent of 16-24 year olds were
employed.
GOVERNMENT JOB OFFICES ARE LITTLE HELP
4. (SBU) Since 1997, the Turkmen government has operated "labor
exchanges" or employment offices, operating as self-sustained
entities under local governments. Although most vacancies in the
labor exchanges' databases are for unskilled positions, employment
offices have not been effective in reducing unemployment, according
to local staff. Turkmenistan's regulations require that all
vacancies be shared with interested applicants in such labor
offices. The hiring process in state agencies and enterprises is
not transparent, however, and corruption has undermined the purpose
and utility of these offices. Job vacancies are concealed from job
seekers, and hiring officers reportedly often hold the vacancies for
their extended family members or sell them like a commodity. A
friend of a Pol/Econ local staff member said that she was asked to
pay a $5,000 bribe to allow her son to apply for a junior staff
position in a government agency. The bribe, however, would not
guarantee the person would get the job before he passed the official
security and loyalty clearance process.
HITCHES TO GOVERNMENT EMPLOYMENT
5. (SBU) The government employment clearance process includes a
criminal background check of the candidate, as well as members of
his immediate and extended family, both alive and deceased. Checks
are also performed to ensure that neither the candidate nor any of
his relatives were ever involved in any questionable activity that
ASHGABAT 00000299 002 OF 003
would put his political loyalty in doubt. The security check is
conducted by the Ministry of National Security (MNB) and can take 6
months, according to local staff. Upon successful completion of the
clearance process, the candidate then signs a six-month labor
contract. Renewing this labor contract is dependent upon an
employee's work performance and the loyalty he has demonstrated to
his superiors. Local staff report that it is common for corrupt
managers to abuse this authority by pressuring employees to pay
bribes to have their labor contract extended. The relative of one
local staff person who has been a secondary school teacher for over
15 years, reported that the school's principal demands a $50 bribe
from the teacher every time her contract must be extended. (NOTE:
The government introduced a 6-month labor contract system in 2005.
The intention was to make it easier for government agencies to
dismiss unwanted personnel after former President Niyazov ordered
government entities to reduce their staffing. His plan had been to
apply the savings acquired through firings to pay for wage increases
for everyone else. This strange contract system is still in place.
END NOTE.)
GOVERNMENT EMPLOYMENT STRATEGIES NOT IDEAL
6. (SBU) In the mid-1990s, ostensibly to help reduce unemployment,
former President Niyazov built two textile complexes, each of which
was to employ up to 3,000 people, as well as cotton mills that would
employ 500 people in each of the five provinces. In more recent
years, however, due to low crop yields and ever-decreasing cotton
production, these factories have all cut their labor force by some
50 percent, according to local staff. Today, a variety of factories
and industrial complexes are appearing on the Turkmen landscape.
Before a factory is even commissioned, however, the jobs they
represent are often passed by provincial authorities to their
extended family members, according to local staff. Those without
family connections might, however, get a factory job by paying a
bribe of $300, but this is a significant amount of money for a
provincial resident to come up with.
7. (SBU) The government now requires that foreign businesses
operating in Turkmenistan be staffed with at least 70 percent
Turkmen citizens. Foreign construction companies, in particular,
are employing significant numbers of Turkmen, especially in and
around Ashgabat. However, employment with construction firms is
short-term, and the average salary of $100 per month is low for
unskilled laborers, considering the demanding nature of the work as
well as the ten-hour days and six-day workweeks that are required.
Nonetheless, local staff report that a significant number of
unskilled laborers are migrating from northern and eastern rural
regions to land one of these jobs. The official hiring process for
permanent positions requires that an employee be a registered
resident of Ashgabat. The lack of registration, therefore, can
limit one's employment options even more. Local staff report,
however, that the Ashgabat residence requirement can be overcome by
paying a bribe to the proper people. Because of construction's
temporary nature, those who migrate from the provinces to work in
construction do not have the residency requirement. (NOTE: This
likely makes unskilled construction work more alluring for rural
residents. END NOTE.)
PRIVATE SECTOR OPPORTUNITIES HAVE THEIR LIMITS
8. (SBU) Employment opportunities in the private sector include
jobs in the restaurant business, retail sales and private
transportation and shipping services, as well as in the offices of
diplomatic and international entities. The jobs are often filled by
people of a certain age and gender. For example, restaurant and
retail businesses hire only females 18-25 years old, and private
security agencies hire only young men who completed their military
service and are under 30. Owners of private shipping companies
prefer to hire experienced, middle-aged drivers. However, in
Turkmenistan's private sector, company owners and managers first
offer available jobs to extended family members, according to local
staff. Self-employment is also very common. This includes private
ASHGABAT 00000299 003 OF 003
cab drivers, food vendors, private caterers, seamstresses,
hairdressers, welders, and plumbers. People with post-secondary
education often tutor schoolchildren as well.
9. (SBU) COMMENT: Although much of this is anecdotal, and there
are no solid statistics, it does paint a picture of a labor
environment with rigid employment regulations and a lack of
transparency that has provided additional opportunities for
corruption to those who wield any modicum of authority. Regarding
the number of high school-educated youth entering the labor force
annually, this is an alarming concept to consider, in that societies
with growing pools of unemployed youth without prospects tend to
experience social and criminal stresses as a result. Giving the
private sector a little more room to grow, and promoting the
development of more small to medium-sized businesses would likely
help ease these stresses. END COMMENT.
MILES
SENSITIVE
SIPDIS
STATE FOR SCA/CEN, EEB
E.O. 12958: N/A
TAGS: PGOV SOCI ECON TX
SUBJECT: TURKMENISTAN: UNEMPLOYMENT STILL THE ELEPHANT IN THE ROOM
1. (U) Sensitive but unclassified. Not for public Internet.
2. (SBU) SUMMARY: Unemployment is still a major problem in
Turkmenistan. President Berdimuhamedov's mandates, such as ending
reductions in personnel in order to pay for wage increases and the
reinstatement of ten years of schooling, have helped to slow the
growth of unemployment. However, Berdimuhamedov has not yet offered
any concrete ideas for reducing unemployment. Unemployment appears
to be especially acute among those aged 16-24 and among rural
residents. Locals assess that the government has done little to
create new jobs, and its modest efforts to help people find jobs has
been corrupted by opportunism. Even foreign businesses provide only
a modicum of largely temporary relief for the problem, which seems
destined to grow. Promoting the development of more small- to
medium-sized private businesses and allowing a more fertile
environment for them to grow would help ease the stresses that
unemployed youth could potentially put on this society. END
SUMMARY.
GROWING POOL OF YOUNG AND UNEMPLOYED
3. (SBU) The central government continues to be the most
significant employer for Turkmenistan's population. Seventy to
eighty percent of the employed population is thought to be working
in the public sector. Government statements in recent years suggest
that some twenty percent of the workforce is in the private sector
or self-employed. Official unemployment statistics have not been
published in 13 years, however, making it difficult to evaluate such
statements. The last official survey, conducted in 1995,
implausibly assessed unemployment to be three percent. A 2006 Asian
Development Bank report estimated that unemployment in the country
was more than 50 percent. Local residents consider the most
vulnerable category of the population to be the 16-24 year old age
group in both urban and rural areas. The Ministry of Education
reported that some 115,000 students graduated from high school in
2008. Our Public Diplomacy office, through its work on education
programs, estimates that about 30,000 are enrolled in universities
here and abroad annually. Using these figures, it is possible to
deduce that some 70,000 young people are entering the country's
labor pool annually, equipped with a high school education.
According to a Ministry of Education report presented at the Central
Asian Republics and Kazakhstan (CARK) Education Forum in Dushanbe on
June 7-8, 2005, only about 11 percent of 16-24 year olds were
employed.
GOVERNMENT JOB OFFICES ARE LITTLE HELP
4. (SBU) Since 1997, the Turkmen government has operated "labor
exchanges" or employment offices, operating as self-sustained
entities under local governments. Although most vacancies in the
labor exchanges' databases are for unskilled positions, employment
offices have not been effective in reducing unemployment, according
to local staff. Turkmenistan's regulations require that all
vacancies be shared with interested applicants in such labor
offices. The hiring process in state agencies and enterprises is
not transparent, however, and corruption has undermined the purpose
and utility of these offices. Job vacancies are concealed from job
seekers, and hiring officers reportedly often hold the vacancies for
their extended family members or sell them like a commodity. A
friend of a Pol/Econ local staff member said that she was asked to
pay a $5,000 bribe to allow her son to apply for a junior staff
position in a government agency. The bribe, however, would not
guarantee the person would get the job before he passed the official
security and loyalty clearance process.
HITCHES TO GOVERNMENT EMPLOYMENT
5. (SBU) The government employment clearance process includes a
criminal background check of the candidate, as well as members of
his immediate and extended family, both alive and deceased. Checks
are also performed to ensure that neither the candidate nor any of
his relatives were ever involved in any questionable activity that
ASHGABAT 00000299 002 OF 003
would put his political loyalty in doubt. The security check is
conducted by the Ministry of National Security (MNB) and can take 6
months, according to local staff. Upon successful completion of the
clearance process, the candidate then signs a six-month labor
contract. Renewing this labor contract is dependent upon an
employee's work performance and the loyalty he has demonstrated to
his superiors. Local staff report that it is common for corrupt
managers to abuse this authority by pressuring employees to pay
bribes to have their labor contract extended. The relative of one
local staff person who has been a secondary school teacher for over
15 years, reported that the school's principal demands a $50 bribe
from the teacher every time her contract must be extended. (NOTE:
The government introduced a 6-month labor contract system in 2005.
The intention was to make it easier for government agencies to
dismiss unwanted personnel after former President Niyazov ordered
government entities to reduce their staffing. His plan had been to
apply the savings acquired through firings to pay for wage increases
for everyone else. This strange contract system is still in place.
END NOTE.)
GOVERNMENT EMPLOYMENT STRATEGIES NOT IDEAL
6. (SBU) In the mid-1990s, ostensibly to help reduce unemployment,
former President Niyazov built two textile complexes, each of which
was to employ up to 3,000 people, as well as cotton mills that would
employ 500 people in each of the five provinces. In more recent
years, however, due to low crop yields and ever-decreasing cotton
production, these factories have all cut their labor force by some
50 percent, according to local staff. Today, a variety of factories
and industrial complexes are appearing on the Turkmen landscape.
Before a factory is even commissioned, however, the jobs they
represent are often passed by provincial authorities to their
extended family members, according to local staff. Those without
family connections might, however, get a factory job by paying a
bribe of $300, but this is a significant amount of money for a
provincial resident to come up with.
7. (SBU) The government now requires that foreign businesses
operating in Turkmenistan be staffed with at least 70 percent
Turkmen citizens. Foreign construction companies, in particular,
are employing significant numbers of Turkmen, especially in and
around Ashgabat. However, employment with construction firms is
short-term, and the average salary of $100 per month is low for
unskilled laborers, considering the demanding nature of the work as
well as the ten-hour days and six-day workweeks that are required.
Nonetheless, local staff report that a significant number of
unskilled laborers are migrating from northern and eastern rural
regions to land one of these jobs. The official hiring process for
permanent positions requires that an employee be a registered
resident of Ashgabat. The lack of registration, therefore, can
limit one's employment options even more. Local staff report,
however, that the Ashgabat residence requirement can be overcome by
paying a bribe to the proper people. Because of construction's
temporary nature, those who migrate from the provinces to work in
construction do not have the residency requirement. (NOTE: This
likely makes unskilled construction work more alluring for rural
residents. END NOTE.)
PRIVATE SECTOR OPPORTUNITIES HAVE THEIR LIMITS
8. (SBU) Employment opportunities in the private sector include
jobs in the restaurant business, retail sales and private
transportation and shipping services, as well as in the offices of
diplomatic and international entities. The jobs are often filled by
people of a certain age and gender. For example, restaurant and
retail businesses hire only females 18-25 years old, and private
security agencies hire only young men who completed their military
service and are under 30. Owners of private shipping companies
prefer to hire experienced, middle-aged drivers. However, in
Turkmenistan's private sector, company owners and managers first
offer available jobs to extended family members, according to local
staff. Self-employment is also very common. This includes private
ASHGABAT 00000299 003 OF 003
cab drivers, food vendors, private caterers, seamstresses,
hairdressers, welders, and plumbers. People with post-secondary
education often tutor schoolchildren as well.
9. (SBU) COMMENT: Although much of this is anecdotal, and there
are no solid statistics, it does paint a picture of a labor
environment with rigid employment regulations and a lack of
transparency that has provided additional opportunities for
corruption to those who wield any modicum of authority. Regarding
the number of high school-educated youth entering the labor force
annually, this is an alarming concept to consider, in that societies
with growing pools of unemployed youth without prospects tend to
experience social and criminal stresses as a result. Giving the
private sector a little more room to grow, and promoting the
development of more small to medium-sized businesses would likely
help ease these stresses. END COMMENT.
MILES