In this paper we determine the feasibility of using data from the Egyptian Labor Market Panel
Survey of 2006 and the Jordanian Labor Market Panel Survey of 2010 (ELMPS06 JLMPS10)
to estimate the Burdett-Mortensen job search model. The data contains sufficient information
on wages, labor force states, durations, and transitions to generate estimates of the model's
structural transition parameters which eventually enable us to explain the persistent high
unemployment rates in the region. By extracting different 10-year employment panels for
Egypt and Jordan from the available cross-sectional datasets, results indicate that arrival rates
of offers for workers are generally higher when unemployed than when employed. When a
worker is already employed, the arrival rates of offers for highly educated workers tend to be
higher than their uneducated peers. We therefore find that they consequently move faster up
the job ladder. Both countries have extremely low job destruction rates. When comparing the
two MENA countries, Egypt's labor market tends to be much more rigid than its Jordanian
peer, where extremely higher search frictions force labor market entrants and on-search
workers to accept what they are offered. We therefore observe a peculiar high monopsonistic
power exerted by the employers. Although, we were able to calculate a firm-specific
productivity distribution, we choose to focus on the supply side of the equilibrium job search
model. We therefore study labor market differentials across the different educational groups
in Egypt and Jordan, showing that the wide variation in frictional transition parameters across
these groups helps to explain persistent unemployment and wage differentials especially
among the very high-educated youth. Fit analysis tests and policy implications are performed
based on the obtained results. The paper is a preliminary endeavor to explore the dynamics of
the MENA region’s labor markets (particularly Egypt and Jordan) and test for their extent of
rigidity.