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Labor woes in the Middle East, Part I

Labor woes in the Middle East, Part I

The global credit crisis is ripping through economies in the Middle East, forcing companies to announce hefty job cuts. Nowhere, not even the Gulf, has been spared.

December 14, 2008 10:34 by

Every part of the Middle East and North Africa could see job losses as the world’s economies continue their slowdown. Yet the closer your business ties to Europe, the more your job is at risk. Economists say that a new influx of job-seekers emerging from the West is giving expatriate white-collar workers in construction and financial services concerns that their pay and conditions will be driven down.

The biggest labor market to see job losses is the Maghreb, particularly Morocco, says economist Simon Kitchen of investment bank EFG Hermes. Tens of thousands of Moroccans work in France, Italy and Spain, and many will face redundancy as the economies of Southern Europe slow. This will be compounded by the impact on the tourism industry. Seventy percent of tourists to Morocco come from these countries. A major job-provider and export-earner, tourism is one of the first sectors to suffer from the economic downturn.

“The European economies are slowing down and there is no alternative source of demand for Morocco,” says Kitchen. “The economy is stuck between scissor blades. On the one hand, there’ll be layoffs at home. On the other hand, there’ll be workers returning from Europe, having made redundant, who will also be looking for work.”

This June, hundreds of Moroccan youths rioted over unemployment in the port town of Sidi Ifni. Its economy has been growing steadily since the turn of the century. While this has boosted the profits of home firms and foreign investors, it has not led to enough new jobs.

Egypt, equally, needs job creation for its social and political stability. The government says…

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