DHEISHE CAMP, Occupied West Bank (AP) _ Electrician Sami Kanouneh is one of thousands of Palestinians who have become economic casualties of rising Arab-Israeli violence.

The Jewish contractor who had employed Kanouneh for the past 12 years fired him on Oct. 29.

''He was fed up with strikes, curfews and the army closing the roads,'' Kanouneh said in an interview in this refugee camp south of Jerusalem. ''And, I think, he was afraid.''

A wave of stabbing attacks by Palestinians and Israelis since mid-October was the last straw in labor tensions built up during the 34-month-old uprising against Israeli occupation of the West Bank and Gaza Strip.

The Arab stabbings of Israelis and counterattacks by Jews followed the Oct. 8 slayings of 20 Palestinians by police on Jerusalem's Temple Mount. Five people have died and more than a dozen have been wounded in revenge attacks.

No official figures exist on how many Palestinians have been laid off since the latest Arab-Jewish violence began.

But Israeli newspapers have carried almost daily reports of Palestinian firings. They include the cleaning crew at a big Tel Aviv shopping mall, construction workers at a nearby bus terminal, textile mill employees in southern Dimona and restaurant workers in Jerusalem.

Shaher Saed, secretary-general of the West Bank trade union federation, estimates that 9,000 of the 110,000 Palestinians employed in Israel have lost their jobs since the Temple Mount riot.

Israel's Employment Service reported 10,000 requests for workers during a five-day army closure of the occupied territories to prevent Arab attacks. That is seven times more than normal, said Benny Schwartz of the service.

The layoffs couldn't come at a worse time for the 1.7 million Palestinians living in lands seized by Israel in the 1967 Middle East war.

They already faced new competition for jobs from the thousands of Soviet Jews emigrating to Israel. The 120-store Co-op Blue Square supermarket chain has replaced its Arab cleaning crews with Soviets, company officials said.

And Palestinians can't turn to the occupied lands for work.

Israeli restrictions on industry and a lack of investment in the territories have left the Arabs with few factories - neither basic industries such as steel and cement, nor high-tech ones such as electronics.

The West Bank Data Project, an Israeli think tank headed by former Jerusalem Deputy Mayor Meron Benvenisti, accuses Israel of systematically blocking development in the territories.

The goal has been to keep Palestinians as a cheap and captive labor force and the territories as a ready market for Israeli-made goods, it concludes.

Palestinian businessman Charles Shamas says Israel has denied construction permits, limited imports of raw material, refused marketing permits and even taxed loans and grants for Palestinian development.

''In general, they will not permit any industry that could compete with theirs, especially in the export market,'' Shamas said.

For Arab workers such as Kanouneh, 28, this means there are few jobs to replace those lost in Israel.

''I've been looking everywhere, but there is no work,'' he said. A father of six, he has food to buy, utility bills to pay and no savings to fall back on.

Many Israeli employers are keeping Arab workers out of loyalty or to keep paying cheap wages, but the realization that thousands more might be fired has prompted another look at government policies on Palestinian labor.

Defense Minister Moshe Arens told a Parliament committee this week that Israel risks social upheaval if there is a wholesale firing of Arabs.

''What Arens is saying is that the policy of the government since 1967 was to create job opportunities for Arabs from the territories in Israel,'' said Arens aide Dan Neveh. ''Now is the time to start changing this so Israelis will get the opportunities in Israel and Arabs will find jobs in the territories.''

Some Palestinians were skeptical that Israel would do anything to make up for the lost jobs, saying Israelis feared economic independence would only encourage calls for a Palestinian state.

Economist Adel Samara from the West Bank town of Ramallah said the new layoffs could quickly damage the territories' $1.5 billion economy.

''Most workers have no savings,'' he said. ''Their financial difficulties will be immediate and their lower consumption will result in further economic stagnation in the territories.''

And Saed, the trade unionist, said the dismissals of Arabs could be costly to Israeli businesses.

''The average Palestinian construction worker earns 1,200 shekels ($600) a month,'' Saed said. ''An Israeli would demand double, and he also would get benefits like unemployment insurance and pension.''

''It will be hard to find unemployed Israelis willing to clean streets, work in bakeries and do other menial jobs that Palestinians have filled,'' he said.