The war on Iraq and regional instability have dealt a devastating blow to an industry already on the ropes. Rehab Saad investigates working conditions in the tourism sector When Ali and Maged graduated from the Faculty of Tourism and Hotels in 1989, they were sure a prosperous career lay ahead. They learned that tourism is the most rapidly growing industry worldwide, that it powers economic development and is a labour-intensive industry. However, when the 1991 Gulf War erupted following the Iraqi invasion of Kuwait, Ali and Maged's dreams were shattered. Ali lost his job working as a freelance tourist guide. Travel agencies could not hire him because there were simply no tourists coming to Egypt. Maged, who was working in a travel agency, was a little luckier. He kept his job, but his hours were slashed and his salary halved. It has been a rough ride since then. Ali and Maged are not alone. Thousands of others working in the tourism sector have been dealt similar blows. At the time of the Gulf crisis, official statements were made concerning the necessity of preserving jobs in the tourism industry. Many solutions were suggested, the most important of which was the establishment of several unemployment and crisis insurance funds to help pay the salaries of workers during steep declines in tourism. With the end of the war, tourism had made a resurgence and promises to secure employment in the field vanished into thin air. Not a single fund was established and officials and workers alike seemed to forget the problem. Nevertheless, the industry suffered from 1992 to 1997 following a number of terrorist attacks targetting travellers. The climax was a massacre in Luxor in 1997 that claimed the lives of 58 tourists visiting the sanctuary of Hatshepsut Temple in Deir Al- Bahari. Those employed in tourism, such as Ali and Maged, were again faced with the possibility of unemployment and decreased earnings. Talk of securing jobs in tourism resurfaced in official statements, newspapers, magazines and TV programmes. Escalating Israeli aggression against the Palestinians, the 11 September attacks on the US, the war in Afghanistan and the invasion of Iraq have dealt further blows to Egypt's tourism industry. Although each crisis has worried those who work in the industry, like Ali and Maged, a feeling of insecurity now overwhelms them. They are well paid during times of peace, but with an international crisis, they could lose everything in a minute. In response, some have quit the business altogether in search of more secure jobs despite lower salaries. Others have set up private non- related tourism businesses while maintaining second jobs in tourism. Yet a third group has been forced to cope as best they could. Tourism is the country's highest earning sector of foreign currency, with annual revenues of $4.3 billion. This is followed by remittances from Egyptian workers, Suez Canal revenues and petroleum. Tourism contributes 11.3 per cent of the total Growth Domestic Product (GDP) and thus is considered a major part of the Egyptian economy. According to a study by the Egyptian Centre for Economic Studies (ECES) in June 2000, tourism is a crucial source of employment opportunities as it provides 2.2 million jobs, accounting for 12.6 per cent of Egypt's total employment. One million jobs are directly related to tourism and 1.2 million are related to the industries and services that are complementary to it. Although there are no official figures on the number of people who lost jobs in the tourism industry during the invasion of Iraq, one government report said that an estimated 250,000 persons employed in tourism in Egypt were expected to lose their jobs and that some 385,000 labourers who work in complementary activities could become unemployed. There are three types of employment in tourism. There are those with permanent contracts who have social insurance and are indispensable. There are "casual" workers hired during high seasons for secondary jobs that may require lesser skills. Finally, there are those employed in a sector indirectly related to tourism, such as a furniture or a carpet factory, restaurants or shops. "The three types [of employment in tourism] are affected on different levels during crises," said Sayed Moussa, the former head of the Egyptian Tourism Authority (ETA). He explained that a crisis could result in a complete loss of clients, which would directly affect employees with permanent contracts. In cases in which there is only a marginal drop in the numbers of tourists, casual workers rather than those with permanent contracts may be laid off. Also, those who work in sectors indirectly related to tourism may lose customers if the industry is hit. To alleviate the dismal business conditions, Nile cruisers, hotels, travel agencies and tourist bazaars adopt procedures to contain their losses and minimise expenses. Among other things, they may reconsider their employment strategy and eliminate unnecessary staff. Casual workers are usually the first to go during any drop in tourism. This is true not only in Egypt but worldwide. According to a hotelier who wanted to remain anonymous, if his hotel employs seven office boys who work in seven departments in the hotel, they may dismiss six and keep only one to cover all seven departments. In travel agencies, most of the representatives who meet and assist tourists at the airport are casual workers, in addition to tour leaders, transfer men and tourist guides. However, workers with permanent contracts are not untouched in crises. They also have their share of troubles. According to Maha Saad, director of public relations at the Starwood hotel chain in the Middle East, the first thing to happen during a crisis is that employees are asked to take any holidays remaining from the previous year. "I believe it is better to take a vacation when there is nothing to do," she explained. "If the period of crisis extends, we move to the next step, namely, to give leave without pay to employees starting from top posts to the bottom -- from general managers to the most minor posts in the hotel. If the crisis worsens, we may become obliged to dismiss people. However, this has not yet happened to us because as soon as we apply our contingency strategy and employees finish their holidays, the crisis is usually over," she said. Saad explained that although the 11 September attacks on the US resulted in a drop in the number of travellers to Egypt, tourism had recovered within three months. However, in some establishments, employees have suffered from more than obligatory holidays, whether paid or unpaid. Atef Mahmoud, whose name was changed upon request, said that some hotels have reduced employee privileges. "For example, in my case, they cut the LE500 car allowance, LE600 mobile phone allowance and meals. Unfortunately these privileges are not stated in the contract we sign with the hotel," he said. On the other hand, Sameh El- Masry, a travel agent whose name was also changed upon request, admits that although he works in one of the leading travel agencies in Egypt, his salary was reduced by 50 per cent after the war on Iraq and his hours were cut in half. "My boss said, 'You can take it or leave it.'" Ilhamy El-Zayyat, the head of the Egyptian Federation for Tourism Chambers and the Emeco Group, says that people have to be realistic. "If there is a crisis and the employer doesn't have the resources or sufficient occupancy rates, all that he can do is minimise the number of employees. Such cutbacks can reduce expenses not only on salaries but also the cost of electricity, water, telephones, computers, food and accommodation, in the case of hotels," he said. El-Zayyat added that lay offs in the tourism industry are occurring not only in Egypt but across the world. "When the 1991 Gulf War erupted, some French travel agencies in France who were dealing with the Middle East dismissed some of their staff when business suffered," he said. With the current crisis in Iraq, El- Zayyat explained that fewer tourists have come to Egypt during what should have been the high season. This may lead to a significant drop in prices to lure tourists back. "I am obliged to lower prices this summer, operating almost without profit, and have to pay for electricity, water, taxes and insurance instalments indefinitely. At the same time, I cannot stop making marketing trips abroad because this is the only way to encourage future customers. I believe it is a vicious circle," he said. In fact, many travel agencies and hotels are complaining that at a time when they suffer from a downturn in business, they have to pay salaries, bank loans, taxes, electricity bills and numerous other expenses. Ahmed Ezzat, the head of Greatsy Travel, believes that if the government wants to solve the problem of unemployment in the tourism sector resulting from regional and international crises, it has to be more considerate. "Despite the slump in tourism, the government is pursuing travel agents to pay their taxes, insurance instalments and bank loans at a time when some of them [travel agencies] are about to declare bankruptcy," he said. Ezzat said that the government should postpone the payment of insurance instalments and should reschedule debts and bank loans. "The central bank should be instructed to cooperate with the travel agencies to overcome the crisis." However, Moussa believes in a different approach. "If we want to get out of the tourist crisis, we should tackle practical solutions that do not harm other sectors of the country. Postponing insurance payments, bank loans and taxes would appear to be a solution for the tourism sector but would represent a burden for other sectors. Banks cannot dispense with their debts, loans or profits." So, how can the industry bounce back? Experts, hoteliers and travel agencies have discussed many solutions. Unfortunately, these solutions are often considered after the harm has been done and are never implemented. One of the most feasible ideas is the establishment of an unemployment insurance fund. This fund would pay a portion of employee salaries in times of crises. Although a law was passed last year allowing the establishment of such a fund, it never materialised. Law No 156 of 2002 allows any tourist establishment whose number of permanent labourers exceeds 32 to reduce salaries by one per cent during crises. To help protect workers, the fund would pay 75 per cent of their basic salaries with a minimum of LE150 and maximum of LE1000 for six months. Most travel agencies and hotels interviewed by Al-Ahram Weekly had never heard about the law, although they believe it is a brilliant idea. According to El-Zayyat, establishing such a fund is the most effective way to preserve workers' rights and prevent lay offs. "It is not in any company's interests to dismiss its workers. It takes a company a minimum of 10 years to prepare qualified employees. They need a lot of training, which costs the company a great amount money, time and effort," he said. "The only thing the Egyptian Federation for Tourist Chambers can do now is ask the cabinet to put the fund into effect. This is the only hope." The Egyptian General Tourist Guide Syndicate is establishing another unemployment insurance fund. For a syndicate that includes 7,500 tourist guides, 90 per cent of whom are suffering from unemployment as a result of the war on Iraq, the establishment of such a fund is essential. According to Mohamed Ghareeb, the syndicate's head, the fund was established in cooperation with the Ministry of Social Affairs when the war on Iraq started. Each participant pays a certain amount of money depending on his or her age. The amount ranges from LE50 to LE500 per year. In times of crises, participants receive between LE10,000 and LE30,000. Some major companies such as Vodafone and MobiNil as well as several banks contribute to the fund by publishing their advertisements in the syndicate's periodical bulletin. "About 140 tourist guides contribute to the project so far. I believe it is a good start," Ghareeb said. In order to counter the tide in unemployment of tour guides, the syndicate has decided to target local markets. "We have informed all syndicates in Egypt, major companies (Egyptian and foreign) and banks that we as tourist guides are ready to accompany them on their trips in Egypt, especially to ancient sites. This is better than resorting to unqualified people to explain history," said Ghareeb, who is a German- speaking guide. These solutions sound impractical to some. "Will anybody from the local market listen to our explanations? Will we be paid LE130 per day as is stipulated by the Ministry of Tourism? I do not think so," said a tourist guide who wanted to remain anonymous. He added that paying LE500 for the unemployment insurance fund is unrealistic "because we are already in a crisis. Where will we get the money?" he asked. Moussa suggests that workers who are laid off during tourism downturns be employed in related projects in progress. "We are building 104,000 rooms. Why don't we use those who are dismissed in such projects, even if they have to be paid minimal salaries," he said. In addition to saving jobs, Moussa says the plan could also be a means for training workers as well.
