Monday, September 13, 2010

Now it gets serious (Updated)

Regardless of what Fidel Castro may have said or meant about Cuba’s “model,” today’s Granma contains an important announcement about what the government means when it discusses the “development and updating of the economic model that we should follow.”

The headline is bland: “Announcement of the Central de Trabajadores de Cuba.”

The news is huge: 500,000 layoffs by next April, with a “parallel increase in the non-state sector.”

For laid-off workers, the announcement says, “the current set of options will be broadened and diversified with new forms of non-state labor relations as an employment alternative: among them renting, usufruct, cooperatives, and self-employment, toward which hundreds of thousands of workers will move in the coming years.”

That means a large expansion in Cuba’s private sector: “renting” refers to the leasing of state installations such as barber shops and beauty shops where the workers now operate as small entrepreneurs; “usufruct” refers to long-term leasing of land or other means of production as in farm cooperatives; “cooperatives” sounds like a decision to use in the cities a model already working in the countryside; and “self-employment” is Cuba’s small entrepreneurial sector, which has accounted for about three percent of the labor force.

The announcement notes that “it is known” that the government and its enterprises have more than one million excess workers. It says that the state sector will only be able to absorb laid-off workers in certain sectors: agriculture, construction, teachers, police, industrial workers.

The outlines of this action have been presented in various settings, but the details presented today – the numbers and the date – are new and mark a new phase in Cuba’s economic reform, one that will be readily observable across the island.

If fully carried out, a major expansion of Cuba’s private sector will benefit many thousands of Cuban families and give Cuban Americans opportunites through remittances to help relatives in Cuba who will be working on their own.

(Update: Reuters is reporting: "According to Communist party sources who have seen the detailed plan to 'reorganize the labor force,' Cuba expects to issue 250,000 new licenses for self-employment by the close of 2011, almost twice the current number, and create 200,000 other non-state jobs.")

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