1. Industrial SME’s Role in Job Creation and Sustaining Growth in Jordan
Dr. iyad abu haltam
Jordan chamber of industry

2. International Experience
Real engine of growth and job creation.
Major field to enhance productivity, innovation,…
90% of firms in the world
60% of labor force
95% of EU firms
More then 50% of labor force in EU

3. International Experience

4. Why SME’s Labor intensive
This role comes as a result of the following facts:
Labor intensive
Income Redistribution
Efficient use of resources
Building productive environment
Major component of local development

5. SMEs in Jordan 99.6 % MSMEs 91.5% Micro 0.4 % Large Employment Large
> 100
Medium
20 – 99
Small
5 – 19
Micro
1-4
No. Firms
Large
668
Medium
2,244
Small
10,454
Micro
143,362
TOTAL
156,728
0.4 % Large
1.4 %
Medium
6.7 % Small
99.6 % MSMEs
91.5% Micro

6. SMEs in Jordan
Employment
Value-Added
60%
0.4%
30%
70%
99.6%
40%

7. SMEs in Jordan
It is not acceptable to push the economy from the top
SMEs

8. SMEs in Jordan
SMEs

9. The Role of Industrial Sector in the Economy

10. Main Industrial Indicator
Total capital: more than 5 billion
Total Firms:
18,000 firm
Employees:
240,000 worker
Exports:
More than 90% from national exports

11. Socio-economic role of industrial sector
Around 70% of FDI went to the industrial sector
More than one billion JDs as salaries and pensions
Industrial sector pays more than 1.1 billion dinar as tax on production, on average 8 cent per one production dinar.
Industrial sector contributed in national reserve by more than 7 billion dollar each year, result from export and investment.
More than 25% as a GDP contribution

12. SME’s in industrial sector

13. Why SMEs considered as growth accelerator
Labour Intensive
Low Initial Investment Requirements
Local Markets Oriented
Ability to play a major role in backward and forward linkages.

14. SME’s role in job creation

15. Unemployment in Jordan
Unemployment Considered as the major challenge in Jordan.
Unemployment rate retched about 11.7% in the first three quarters of 2014.
The percentage of population in the working age in Jordan is about (60%) for the total population.
Most of the unemployed people are youth.

16. Unemployment causes in Jordan
The normal increase of population growth. (80 thousands jobs needed yearly to keep unemployment constant)
Inefficient economic development plans
Skilled and unskilled Foreign labour force
Regional situation (refugees)
Insufficient number of jobs created by the economy due to lack of real Public-Private Partnership

17. Unemployment rate in JordanQ3

18. The Role of Jordanian Industrial Sector in Job Creation

19. The industrial sector employs more than 18% of the total labour force in Jordan
Average workers in industrial firm is 13 worker, while the average in other sectors are around 3 worker/firm.
This means that the industrial sector is able to create more jobs than any other sector.
Industrial sector created more than 11 thousands jobs in 2013.
75% of its workers in Industrial sector are covered by social security.

20. Due to the fact, more than 98% industrial firms are SMEs, and the role of Jordan chamber of industry as the main body of Jordan industrial sector, is implementing several programs to create more jobs:

21. JCI Initiative was to Establish the SMEs Technical Support Unit
To Help the huge number of SMEs in the Industrial Sector
To help Industrial SMEs to avoid the major challenges that they may face.
To enhance and to build up the capacity of these firms

22. SMEs Technical Services
Advisory and consultation Services
Access to Finance
Networking and Data base

23. Strategic Goals of SME UNIT
Increase the sufficient level of SMEs
Publishing the concept of self working and entrepreneurship
Enhance the business environment for SMEs
Supporting the financial programs for SMEs
Building positive environment for workers in SME
Sustainable financial services
Conduct the required research and analysis

24. Role of SME Technical Support Unit
Advisory services for establishing SMEs.
Business plans and feasibility studies.
Capacity building for entrepreneurs.
Cooperate and co-ordinate with all institutions for SMEs.

25. Role of SME Technical Support Unit
Supporting financial, production and innovation programs for SMEs.
Participate in building the national database for SMEs.
Building industrial clusters to enhance the level of competitiveness.
Cooperate with the International donors and institutions in the field of SMEs.

27. Training and employability unit
Project Goals:
Activate the role of Jordan chamber of industry to enhance training and job creation fore young job seekers in Jordan
Increase the percentage of Jordanian workers in the industrial sector

28. Training and employability unit
Targeted sector:
Plastic and Rubber Industries
Packing, Packaging, Paper, Cartoon and Stationeries Industries
Food, Supplies, Agricultural and Livestock Industries
Leather and Garments Industries
Furniture and Wooden Industries
Geographic areas covered by the project:
East Amman
Zarqa
Irbid

29. Partnership between academia and industrial sector
Implementing awareness training program for professors and students in universities about industrial sector and its products.
Implementing joint projects according to industrial firms needs.
Lunching Internship programs.

30. Thank you