Raul Castro, president of Cuba, has announced plans to lay off one million Cuban workers to revive the struggling economy, according to BBC.
The Cuban Workers Federation (CTC) said that half of the workers will lose their jobs by next year.
“Our state can’t keep maintaining…bloated payrolls,” the CTC said in a statement to the Wall Street Journal. Those who are laid off will be offered jobs in the agricultural and construction sectors, according the the Havana Times.
Cuba’s economy is nearly bankrupt and they are in dire need of an economic boost. This new effort to reorient its labor force is the country’s largest movement toward free enterprise since the 1990s, when Havana was struggling to survive after the collapse of the Soviet Union, their main economic contributor. Furthermore, in the wake of global economic crisis, the Catholic Church warned Cuba that if their Communist government did not uplift its restraints on business and entrepreneurship, the country would fail, according to the Wall Street Journal.
Those who are not interested in agricultural or construction work have the option of becoming self-employed or joining a cooperative. However, the details on how the Communist Party will handle the self-employment has yet to be announced.
The communist government of Cuba currently employs 85 percent of the workforce, about 5.5 million people.
Some argue that the lay-offs will do very little in terms of economic uplift because many workers do not have the resources needed to start their own business.
In a statement to BBC, the Cuban Workers Federation said:
“Our state cannot and should not continue maintaining companies, productive entities, services and budgeted sectors with bloated payrolls and losses that hurt the economy.”
According to the labor federation, the initial job reduction will actually increase the job options in years to come.
Along with job losses, Raul Castro announced that the role the government plays in regulating business will taper off.
The Communist Party of Cuba has decided to become more lenient, allowing more people to apply for licenses and start their own businesses. Furthermore, existing private businesses will be allowed to hire new employees for the first time since the Communist Party came into power.
A small number of Cubans already work for themselves as taxi-drivers, hairdressers, restaurant owners and other jobs of the like.
The movement could also be in response to Cuba’s thriving black economy, with trades of people independently working without a license from the government.
Raul Castro stated that the country’s role in the economy had to be reduced, saying “We have to end forever the notion that Cuba is the only country in the world where you can live without working.”
Massive Layoffs to Begin in Cuba – Havana Times
Cuba To Cut One Million Public Sector Jobs – BBC
Cuba To Cut State Workers In Tilt Toward Free Market – Wall Street Journal