Labour market trends in North Africa

North African labour markets are marked by high levels of labour underutilization, particularly for youth, and by substantial gender

gaps in labour market outcomes. Since 2010, the subregion’s low LFPR has remained generally flat, and the gender gap has narrowed slightly, owing to a small decline in the participation of men and a small increase in that of women (ILO and ERF 2021a). The decline for men has been driven by youth and is more likely attributableto extended school-to-work transitions and discouragement than to increased school enrolment (ILO and ERF 2021a). Female participation, on the other hand, has been primarily driven by a shift of the composition of the working-age population towards more educated groups, which generally have higher participation rates than less educated groups among North African women.

In this subregion the pandemic resulted in substantial losses in working hours in 2020, and a netdecline in employment of over 2.1million

(table2.1). Youth (people aged 15–24) accounted for nearly a third of net job losses in the region, despite accounting for only 11percent of employment (Appendix C, tableC7). As in many other regions of the world, the COVID-19 crisis has constituted a triple shock for North Africa’s young people. In addition to job and income losses and the risk of deteriorating rights at work, the pandemic has disrupted education and training–with potential long-term implications–and posed extra obstacles to finding work, re-entering the labour market or transitioning to better jobs. All of this brings concerns about “scarring effects” on youth and the long-term implications for a “lockdown generation” (ILO 2021a, 2020c). Although these effects are not unique to North Africa, they carry a particularly heavy weight in this subregion, which has the world’s highest youth unemployment rate and highest total labour underutilization rate6 among youth (ILO 2021a).

The pandemic’s disproportionate impact on women is not immediately clear in North Africa, owing to their under-representation in the subregion’s workforce, and also to offsetting effects; while some women left the labour force after losing their jobs, other women entered it to compensate for lost household income.

Women, who represent only 21percent of workers, accounted for 36percent of net job losses in the subregion in 2020. This equates to a 6.0percent decline in female employment, compared with a 2.6percent decline for men (AppendixC, tableC7). Labour force exits accounted for 59percent of women’s net job losses, compared with 42percent for men, who were more likely to transition to unemployment. Differential gender impacts have been confirmed through rapid labour force surveys conducted by phone in Egypt, Morocco and Tunisia since the onset of the crisis (ILO and ERF 2021b, 2021c, 2021d, 2021e). Although women in Egypt who lost their jobs were indeed more likely to exit the labour force than men between February and June 2020, in the second half of 2020 and throughout2021 both men and women experienced an increase in economic activity, and in Morocco the employment recovery was largely driven by more women entering employment. In Tunisia the significant increase in labour force participation in 2021, coupled with a contraction in wage earnings, suggests that the growth in employment consisted partly of “distress employment”, in which additional household members joined the labour force to compensate for lost household income (ILO and ERF 2021d). A similar “additional worker effect” can also be observed in Morocco, where the female employment rate in April 2021 exceeded its precrisis level (ILO and ERF 2021c).

The pandemic also had differential impacts across workers according to the sector of employment, skill level, status in employment, and contractual or working arrangement,

among other factors. Rapid labour force surveys in Egypt found a heavier toll in lost employment among lower-skilled workers and workers in accommodation and food services and that two thirds of informally employed wage workers and self-employed workers reported income losses, compared with 21percent of formally employed wage workers. Two thirds of surveyed informal workers feared losing their job, compared with one third of formal workers (ILO and ERF 2021b, 2021e).

6 The total labour underutilization rate refers to the composite measure of labour underutilization (LU4), obtained by expressing the sum of the unemployed, the potential labour force (including individuals who are either looking for a job or available to work but do not meet both criteria to be considered unemployed) and individuals in time-related underemployment as a share of the extended labour force (the sum of the labour force and the potential labour force).