Up until recently, our global economy was dominated by industrialized nations who relied heavily on the availability of expensive and complex infrastructure for mining and processing natural resources and manufacturing. However, various significant developments, including the economic crisis of 2008, the spread of the internet and social media and the decreasing costs of technology have led to the disruption of this monopoly. Thus, allowing the emergence of a more inclusive economic model that has gradually increased the participation of formerly marginalized economies in the global market. That being said, these aren’t the only phenomena that have played a pivotal role in changing the dynamics of our global economy.
The unprecedented fusion of our physical, digital and biological worlds, in what’s now being called the Fourth Industrial Revolution, has also transformed our global economies by creating new and innovative industries. In addition to empowering a new generation of entrepreneurs who are re-imagining the products and services available in the market place and disrupting the traditional workforce by moving towards a work model that focuses more on flexibility and project-based work. The UN’s 2030 Agenda for Sustainable Development has also influenced the trajectory of our global markets by emphasizing the need to encourage growth that promotes more responsible social, economic and environmental practices.
The rapid developments of the digital economy have raised many questions about the future of work. Especially in the MENA region where many countries’ workforces are still made up of a large proportion of unskilled and informal laborers. Therefore, leaving many people in the Arab world concerned about their job security. However, this fear can’t stop the key stakeholders in the region from asking the hard questions that need to be asked in order to develop the educational and employment opportunities that will be needed to secure the economic future of the Arab world.
The current state of Arab youth
At the moment, youth under the age of 25 constitute nearly half of the MENA region’s population and more than a quarter of these young people are unemployed. However, this lack of unemployment isn’t the result of a lack of education. According to The Future of Jobs and Skills in the Middle East and North Africa report published by the World Economic Forum in May 2017, “university graduates make up nearly 30% of the total pool of unemployed in the region, with two in five MENA graduates out of a job.” So, why are so many young people struggling to find employment opportunities?
The problem lies in the ever-growing gap between the skills and competencies that the MENA region’s educational institutions are providing youth and what employers are actually looking for in their prospective employees. However, Arab youth aren’t the only ones who are losing as a result of the skills mismatch in the region. According to the same report, “[n]early 40% of employers in the MENA region indicate that skills gaps are a major impediment to business growth.” Thus, highlighting the vicious cycle that continues to persist in the Arab world as a result of the lack of alignment between the region’s various stakeholders.
Having said that, one of the biggest challenges that the Arab world faces when it comes to unleashing the full potential of its economy comes from its inability to fully capitalize on the abundance of educated and talented young people in the region. Although the aforementioned skills deficit prevents many young Arabs from finding jobs, many qualified young people are also hesitant to join the workforce, because they’re unhappy with the compensation and working conditions in the MENA region’s private sector. Consequently, many young Arabs choose to immigrate to countries that offer more attractive salaries and non-monetary benefits (such as mentoring programs, tuition assistance and childcare) which ultimately reduces the level of human capital available in the region.
The aspirations of Arab youth
Bayt.com and YouGov’s Middle East Jobseeker Confidence Survey published in August 2017, highlighted how “jobseeker confidence is a measure of the economic wellbeing of a country.” In other words, if jobseekers are positive about their country’s economy and they have a satisfactory level of disposable income, they’re generally inclined to spend more on consumer goods. However, if job seekers are uncertain about the state of their country’s economy they tend limit their spending, which can create a spending recession that can lead to an economic downturn.
So, how does the Arab world’s young workforce feel about their future potential? According to the aforementioned survey, respondents in the Levant and North Africa were generally more pessimistic about the current state of their family’s finances, their country’s economy and their future job opportunities. On the other hand, respondents living in the GCC reported higher levels of optimism in almost every category. That being said, the young respondents from the Levant, North Africa and the GCC did share one thing in common: they don’t want to seek employment in a company.
In another survey published by Bayt.com and YouGov entitled Entrepreneurship in MENA published in November 2017, an overwhelming majority (between 55% and 76%) of respondents from across the Arab world expressed the desire to have their own business or be self-employed. Some of the reasons cited for this choice include the desire to seek a sense of personal fulfillment and the freedom to choose their own work-life balance.
The jobs of the future in the Arab world
Undoubtedly, while the Fourth Industrial Revolution has presented formidable challenges to the populations of the MENA region, it has also provided new opportunities to establish high value-adding formal sector jobs in numerous fields. However, in order to fulfill this demand, young Arab professionals will have to pursue interdisciplinary qualifications that will enable them to blend digital and STEM skills. Thus, providing the multi-skilled labor force needed to propel the digital economy forward in the Arab world. However, high-skilled jobs aren’t the only ones that have the potential to grow in the near future.
As the population of the MENA region continues to grow, there will be a need for more public infrastructure, including schools, roads, transportation systems, so on and so forth. Consequently, if the region’s stakeholders can strategically address these needs, they could generate a substantial number of medium and low-skilled jobs as a result. Also, by formalizing, professionalizing and upgrading various services in the care economy (such as cleaning, childcare and elderly care) countries in the MENA region could create even more employment and training opportunities for unskilled workers.
While the green economy is projected to generate millions of jobs and boost the GDP of numerous countries in the Arab world, there’s another work trend that stands to capitalize on the region’s underutilized talent pool: the freelance economy. In 2015, a Mckinsey Global Institute report entitled A Labor Market That Works stated that by 2025 it’s estimated that online talent platforms could generate as much as 945,000 additional full-time equivalent jobs and a US$21bn increase in GDP in Egypt and 276,000 jobs and US$32bn additional GDP in Saudi Arabia.
Cultures to support the development of Arab economies
Although countries in the MENA region have the potential to generate millions of jobs across various sectors and different skill levels in the future, their ability to do so will depend on whether they’re able to reskill and upskill their current workforce. Furthermore, it will also rely on their ability to equip the Arab youth of today with the skills of tomorrow. However, in order to be able to achieve these goals, the stakeholders in the region will have to embed 4 essential cultures in Arab communities.
Firstly, a culture of collaboration between the MENA region’s key stakeholders needs to be established to ensure that they can create curricula and learning experiences that will empower Arab youth to thrive in the future workforce. Secondly, a culture of mass digital literacy needs to be established to facilitate the transition of Arab economies to knowledge-based economies that export innovation. Thirdly, a culture of counseling needs to be integrated into the MENA region’s different educational institutions and work places, so young people can make more strategic decisions in their personal and professional lives. Last but not least, a culture of lifelong learning needs to be established, so that individuals and institutions in the MENA region can continue to stay relevant in this age of constant change.
Despite the development gap that currently separates the MENA region from its industrialized counterparts, the rise of the digital economy has created a unique opportunity for Arab countries to level the playing field and responsibly manage this “underdevelopment” by using the best practices that have emerged in the development arena over the past couple of years. Now, the question remains: can the region’s stakeholders effectively co-create and implement the policies needed to unlock the unlimited potential of the Arab world’s youth, talent and resources?
