Cuba’s leaders detail layoff program; see jobs in taxis, construction, farming, rabbit raising

By Paul Haven, AP
Tuesday, September 14, 2010

Cuba’s leaders lay out details for layoffs

HAVANA — Cuba’s communist leaders have already determined what soon-to-be-dismissed workers should do after they get pink slips in sweeping government layoffs, detailing a plan for them to raise rabbits, paint buildings, make bricks, collect garbage and pilot ferries across Havana’s bay.

Many of the workers tossed from state jobs into the marketplace could see their new enterprises fail within a year, officials acknowledge.

The plans, along with a timetable for which government sectors will feel the ax first, are laid out in an internal Communist Party document obtained Tuesday by The Associated Press. Cuba on Monday announced plans to cut 500,000 state workers by March 2011 and help them get work in the private sector, in the most sweeping reforms instituted since President Raul Castro took over from his brother in 2008.

The document says workers at the ministries of sugar, public health, tourism and agriculture will be let go first — and some layoffs already began in July. The last in line for cutbacks include Cuba’s Civil Aviation and the ministries of foreign relations and social services.

Many laid-off workers will be urged to form private cooperatives. Others will be pushed into jobs at foreign-run companies and joint ventures. Still more will need to set up their own small business — particularly in the areas of transport and house rental.

The 26-page document — which is dated Aug. 24 and laid out like a PowerPoint presentation with bullet points and large headlines — explains what to look for when deciding whom to lay off. Those whose pay is not in line with their low productivity and those who lack discipline or are not interested in work will go first. It says that some dismissed workers should be offered alternative jobs within the public sector.

The document hints at higher wages for the best workers — something Castro has been promising for years — but says, “It is not possible to reform salaries in the current situation.”

The outline includes a long list of “ideas for cooperatives,” including raising animals and growing vegetables, construction jobs, driving a taxi and repairing automobiles — even making sweets and dried fruit.

Many of those jobs are already done by Cubans working quietly on the black market who pay no tax on what they earn. In a country where doctors and scientists make only slightly more than the national average monthly salary of $20, it is not uncommon to see surgeons driving illegal taxis in their spare time.

By adding to the legal free-market jobs, the government presumably hopes to to increase its paltry tax revenues as well as reducing its bloated payroll.

The internal document refers to a “new tax system” that will be “more personalized and more rigorous.” It says taxes will be collected on wages, sales, social security payments to retirees and on small businesses that employ people.

Currently the state employs 95 percent of the official work force — some 5.1 million people. Just 143,000 work officially in the private sector.

The internal document warns that one of the main challenges the country will face is that many of the fledgling businesses won’t get off the ground because many laid-off workers will lack the experience, skill or initiative to make it on their own.

“Many of them could fail within a year,” the document says, without outlining what to do with people whose enterprises go under.

The changes announced Monday promise a radically altered economic outlook, especially for Cubans in their 20s and 30s who have known nothing but the paternalistic communist system ushered in by Fidel Castro in his 1959 revolution.

But they were not entirely surprising. 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. In April, he floated the idea that up to 1 million workers were superfluous and must go.

The layoffs were announced by the nearly 3 million-member Cuban Workers Confederation, which is affiliated with the Communist Party and is the only labor union allowed by the government.

Some workers said they were caught off guard.

“I heard the rumors about firings a while ago,” said Luis Estrada, a 55-year-old health clinic worker. “I hope nobody will be left defenseless. Here, everyone has a job.”

In a country where even those who are employed have to scramble to make ends meet, it was not clear how families would find the means to support unemployed relatives, or how much assistance they will get from the state.

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 union’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.

While Raul Castro has insisted his reforms are in keeping with socialist ideals, he has sternly told Cubans that they must stop expecting too much from the government, which provides free education and health care and heavily subsidizes housing, transportation and basic food.

Even before the announcement, interviews with scores of workers across several government sectors showed that layoffs were already under way — with many complaining the state was not doing enough to find them new jobs.

Larry Birns, director of the Washington-based Council on Hemispheric Affairs, said a series of small changes — such as privatizing some state-run barbershops, licensing more private taxis and distributing fallow land to private farmers — have moved Cuba toward economic reform. While none of those were blockbusters, Birns said, Monday’s revelation had the potential to be one.

“Cuba is rapidly becoming like any other country,” he said. “It is not going back. These are big changes.”

Associated Press writer Will Weissert contributed to this report.

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