Along with its major political and social aspects, the “Arab Spring” was mainly
underpinned by the lack of employment opportunities, especially for youths. Deficiency in
competitiveness due to failures in trade liberalization, in line with poor economic growth have
ranked unemployment in the Arab region as being among the highest in the world. This situation
was caused due to a complex combination of different factors. In essence, the demographic
transition that occurred in the region and the economic transformations that have taken place in
former centrally planned countries had created a strong pressure on the job market.
The heart of the problem lies in the fact that while the labor demand is witnessing a rapid
increase, the economy is unable to create enough jobs. Adding to that, job market rigidities do
not allow recruiters to easily hire and fire workers. This reinforces a strong and well spotted
mismatch between the demographic and economic structures in the Arab region. In evidence,
The Arab Labor Organization (ALO) estimates that 20 million persons are currently
unemployed in the region, and that the unemployment rate is growing at a fast pace. Other
estimations show that the Arab Mediterranean Countries will need to create more than
1,500,000 additional jobs per year over the next 10 years in order to provide employment
opportunities for new labor market entrants and to keep unemployment figures unchanged1
.
Doing so requires the rates of economic growth to surpass those achieved in recent years. That
is to say, reforms should be put in place in order to increase the labor content of growth and
better transform economic growth into job opportunities.
In this chapter we put forward an overall presentation of the main characteristics and
failures of the job market in the Arab region, covering the supply side, the demand side, and the
structure of the job market.