A recent report, Arab States Employment and Social Outlook – Trends 2024, prepared by the Regional Economic and Social Analysis (RESA) Unit of the International Labor Organization (ILO), Regional Office for Arab States, showcases the situation of the employment and labor market in the Arab World. Despite economic growth in the Arab region, particularly in the GCC countries, the region faces challenges in its labor market. Decades of political instability, conflict, and global economic conditions have contributed to high unemployment rates (9.8% projected in 2024) and underutilization of the workforce. This is particularly evident in the non-GCC states, where weak private sectors, demographic pressures, and ongoing conflicts pose significant hurdles. While the services sector has emerged as the main job creator, sluggish efforts in economic diversification and a lack of a strong private sector have limited progress, leaving many individuals without work and hindering the region’s full economic potential.
As per the report, Arab Countries struggle with labor market challenges despite economic growth. Low productivity, high unemployment, and lack of quality jobs persist. The region faces skills mismatch, with youth (especially young women) most affected. While some, particularly in non-GCC states, turn to self-employment due to limited formal opportunities, they often lack the resources to grow their businesses. Educational programs need improvement to better equip graduates with relevant skills. In turn, Arab women face major hurdles in the workforce. Their participation rate is low (19.8%), unemployment is high, and they earn significantly less than men. Additionally, migrant workers, crucial to the region’s economy but often facing poorer working conditions, create challenges for government efforts to increase citizen employment.
Moreover, Arab countries face complex labor market challenges beyond just quantity of jobs. Issues include high informality, working poverty, vulnerable employment, and challenges for migrants and refugees. The “brain drain” of skilled workers further hinders economic development in origin countries. Today, climate change poses a major threat to Arab States’ economies and livelihoods, but also presents an opportunity for job creation. Studies suggest a “climate resilience” scenario could lead to a $200 billion GDP increase and 2 million new jobs by 2050. However, to achieve this “just transition,” policies need to support all workers who might be impacted by the shift towards a greener economy.
Concerning Lebanon, the country has a long-standing issue of brain drain, stemming from its history of political unrest, civil conflict, and economic struggles. Over time, many skilled professionals, including doctors, engineers, academics, and entrepreneurs, have chosen to work abroad due to better opportunities and conditions. Even young Lebanese studying abroad often opt not to return home because of superior prospects elsewhere. The country’s economic and financial crisis since 2019 has exacerbated emigration desires. According to a 2021 Gallup poll, the desire to migrate from Lebanon reached a record high that year, with 63 per cent of respondents expressing a strong desire to leave permanently, a significant increase from the 26 per cent reported before the crisis. Additionally, the poll revealed that 85% of Lebanese struggle financially, with 62% describing their situation as “very difficult,” a sharp increase from 2019. These figures are not surprising given the grim economic outlook in Lebanon. In 2022, the CAS/ILO Follow-up Labor Force Survey revealed that job losses reached a staggering 27.7 per cent of the initial size of total employment in 2019. The survey also showed that the employment-to-population ratio in Lebanon plummeted to 30.6 per cent in 2022, a decrease of over 10 percentage points from the 43.3 percent rate in 2019. Furthermore, the unemployment rate surged from 11.4 per cent in 2019 to a concerning 29.6 per cent in 2022, with youth unemployment reaching a staggering 47.8 per cent that year
As such, Lebanon faces challenges due to the loss of skilled individuals in various sectors, but it has benefited significantly from remittances from its diaspora, which accounted for a substantial portion of its GDP in 2022. However, relying heavily on remittances makes the economy vulnerable to external shocks. To address this vulnerability, Lebanon should focus on retaining skilled individuals, promoting economic development and innovation. Additionally, the country should encourage expatriates to invest their remittances in productive sectors to support sustainable economic growth and job creation.
The report presented policy recommendations that aim to foster employment, economic growth, and social equity through various strategies. These include implementing macroeconomic policies to promote structural transformation and private sector development, with a focus on gender equality and youth employment. Additionally, investing in infrastructure, technology, and small and medium enterprises (SMEs) is proposed to stimulate manufacturing growth, particularly in green manufacturing. Aligning education policies with economic strategies and ensuring universal access to lifelong learning are highlighted to meet evolving workforce needs.
For the full report of the ILO, please click on the below link: