A report by the International Labor Organization (ILO) highlights the stagnation of the labor market in the Arab world, which lags behind the economic recovery. It recommends concerted efforts to enhance diversification and create employment opportunities in more flexible sectors.
The report indicates that “the unemployment rate in the region is expected to reach 9.8% in 2024, a higher rate than pre-Covid-19 levels.” It cites various factors affecting the region’s labor markets, including fragmentation, political tensions, instability and conflicts, economic crises, weakness in the private sector, and demographic pressures.
According to the report, titled “Employment and Social Outlook in Arab Countries – Trends 2024: Promoting Social Justice through a Just Transition,” the GDP of the region will increase by 3.5% in 2024, with faster growth in Gulf Cooperation Council (GCC) countries than in non-member countries. However, the post-pandemic labor market recovery lags behind the economic recovery, and decent jobs for a growing workforce remain scarce.
The ILO estimated that in 2023, 17.5 million people in the region were unemployed and unable to find work, resulting in an unemployment rate of 23.7%.
According to the report, many employment challenges in the region stem from economies being unable to generate enough high-quality jobs. As a result, over half of the workforce holds unofficial and precarious jobs, lacking social protection and benefits. In 2023, working poverty affected 7.1 million workers, accounting for 12.6% of the total workforce.
Additionally, significant challenges arise in terms of supply, as education and skill development systems have resulted in a mismatch between the skills sought by employers and those possessed by workers. This disparity has contributed to a rise in unemployment rates in the region, even among individuals with higher levels of education.
The report also underscores the refugee crisis in the region, which presents a major challenge to labor markets. Refugees struggle to secure employment in their host countries due to competition with local residents, leading many to engage in unofficial work. Moreover, the increase in internal displacement resulting from conflicts, violence, and natural disasters is a source of concern.
Furthermore, per the report, the region faces challenges and opportunities related to environmental and climate change. The text suggests that, with suitable, environmentally friendly policies, the region could increase its GDP by $200 billion and create an additional 2 million jobs by 2050. However, this requires the implementation of policies and measures to ensure a just transition.
