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Cuba to cut 500,000 government workers

Updated: 2010-09-15 13:45

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Cuba on Monday said it is laying off nearly half a million workers, an eye-popping figure in any country, but especially in a nation where the government so totally dominates the economy.

The shift would mean that one-tenth of the island's 5.1 million-strong work force will be looking for jobs in the private sector by April 2011, a drastic change that could mean a radically altered economic outlook.

The changes are the most dramatic yet in a reform program that began when Raul Castro permanently took over the presidency from his brother Fidel Castro in 2008.

Raul Castro has warned for years that the state could no longer afford to subsidize every part of Cuban life, nor pay workers who contribute little.

The layoffs announced on Monday will start immediately and continue for months, according to a statement from the nearly 3 million-member Cuban Workers Confederation (CWC), which is affiliated with the government.

"Our state cannot and should not continue supporting businesses, production entities and services with inflated payrolls, and losses that hurt our economy are ultimately counterproductive, creating bad habits and distorting worker conduct," the CWC said.

Yierser Gonzalez, 35, said he would be happy to give up his state job and set up his own food stand, but that he worried about others. "About 100,000 will find private employment, but what will they do with the rest?" Gonzalez asked.

The CWC's outline hints at more layoffs to come, saying that eventually the government will only employ people in "indispensable" areas such as farming, construction, industry, law enforcement and education.

To soften the blow, the statement - which appeared in state newspapers and was read on television and radio - said the government would increase private-sector job opportunities, including allowing more Cubans to become self-employed. They also will be able to form cooperatives run by employees rather than government administrators, and increasingly lease state land, businesses and infrastructure.

Still, Arch Ritter, an expert on the Cuban economy at Carleton University in Ottawa, Canada, said the payroll at state-run enterprises is bloated, a reality that could not continue in a country perennially strapped for cash. Currently the state employs 95 percent of the official work force.

Questions:

1. What fraction of the population is being laid off?

2. Why are the lay offs happening?

3. What percent of the population is employed by the state?

Answers:

1.1/10.

2. Cuba cannot afford subsidized employment.

3. 95 %.

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Todd Balazovic is a reporter for the Metro Section of China Daily. Born in Mineapolis Minnesota in the US, he graduated from Central Michigan University and has worked for the China daily for one year.

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