Informal labour accounts for two-thirds of Morocco jobs

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By Ahmed Eljechtimi

RABAT, (Reuters) – Two thirds of Moroccan jobs are now in the grey economy, statistics agency said, giving its first public assessment of a trend that the government says is depriving the economy of $3.4 billion annually.

Nearly all the jobs in the agricultural sector, which represents 14% of the country’s GDP, were informal, HCP agency said in the study, putting the figure at 97%.

But with recurrent drought blighting the sector, it expected fewer and fewer people to work in farming, with more people turning to the service sector.

The services sector now offers 41% of all jobs in the country, mostly in “small retail and handicrafts jobs”, it said.

The government says workers in informal jobs fall prey to low pay and harsh working conditions while also depriving the state coffers of the tax revenue.

“Compared to their peers in the formal labour market, informal employees work annually 145 hours more on average and receive a pay five times less,” the head of the HCP Ahmed Lahlimi said.

The productivity of formal workers is 3.7 times higher than their informal counterparts, the study showed.

The informal economy represented 30% of Morocco’s economy, the central bank said in 2019. The stats agency did not give a comparison on how the make up of the informal workforce had grown in that time.

Earlier this month, HCP said the unemployment rate rose slightly to 12.9% in the first three months of 2023 from 12.1% in the same period last year as the farming sector sheds jobs amid the worst drought in decades.

The unemployment rate was higher among young people, at 35.3%. Among graduates it stood at 19.8% and among women 18.1%, HCP said. Women took 29.7% of the total jobs in the country, mostly doing manual labour, its study said.

Lahlimi said there was a need for more jobs in small and medium sized industrial enterprises which could absorb job seekers leaving the farm sector and create a higher added value.

The industrial sector accounts for 11% of Morocco’s job market and 25% of its GDP.

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