Managerial and other characteristics affecting the industrial sector's performance in the Gaza Strip

Abstract EN

In this paper, the performance of 105 firms (the study sample out of 523 firms, study population) is analyzed.

For the purpose of this analysis, all sample firms are classified into three groups: Clothing, Food and Others (N.B.

Others include all types industries except clothing and food industries.

Another classification for these firms depends on the size of the firm as reflected in the number of workers being employed.

Group one includes firms which have from 5 to 9 workers, while group two includes firms employing ten workers or more.

This paper is an attempt to compare and contrast the different firms' performance; two different types of indicators are used.

The first is general and descriptive.

The second type includes growth of employment (GE) and cost per job creation (CJC) or capital intensity (K/L) as a technology indicator Industry in the Gaza Strip (GS) has some characteristics that show the nature of the industrial sector as well as the unstable situation.

These characteristics affect the performance of the industry in the region.

This paper also examine the effect of these characteristics, especially the managerial ones, on the performance of the industry.

The objective of the majority of firms is to provide employment opportunities for the owners and their families or relatives using lab our-intensive technique with little assets.

84% of the managers are educated (higher school or above) while 36% of firm owners and managers reported that they follow their fathers' occupation.

The majority of firms are either owned by the family or the manager himself.

Clothing Industry shares with about 50 % of the total value added, while food firms are the highest in terms of average value added.

This implies that clothing firms are lab our intensive and ensure the subcontracting nature of the clothing industry in the NPE.

Although Food and Other firms are not growing in terms of employment, we found that clothing firms are growing fast compared with other firms.

Also we found that clothing as well as subcontracting firms are the best in terms of creating cheap jobs compared with Food or Other firms.

We found that clothing and subcontracting firms are better in terms of profit ratio (PR).

PR in clothing firms equals 28% compared with 18% and 11% for Food and Others Regarding discussion of factors that affected the performance of SSIs, the researcher used the multiple regressions to determine factors affecting cost per job and growth of employment for all firms as well as Clothing, Food and Other firms, individually each one is alone.

For cost per job as a dependent variable in the model, the researcher found that factors affecting it are: initial total assets, average wages, type of technology, age of the firm, and type of ownership.

And the factors determining growth of employment are as follows: age, experience of the firm, growth of total assets, profit ratio, type of finance, current number of workers and initial number workers.

The models are significant and the independent variable explained 60–70% of the changes in the dependent variable.