Entrepreneurs could hold key to job creation in the Middle East

Despite reforms, labour markets in the Middle East and North Africa (MENA) have been unable to absorb the growing number of job seekers. Women and educated youth are particularly vulnerable to high unemployment. However, data on entrepreneurship and the private enterprise sector in the region have been virtually non-existent.

To address this knowledge gap, IDRC funded research in 2009 on entrepreneurship in seven MENA countries using methods developed by the Global Entrepreneurship Monitor (GEM). The researchers sought to better understand the factors influencing the level of entrepreneurial activity in the region. They also wanted to benchmark country and regional performance levels against those of other developing and developed economies. As the first major study of entrepreneurship in this region, the research provides critical baseline evidence for monitoring changes over time.

The research teams surveyed almost 14,000 people aged 18-64 in Algeria, Jordan, Lebanon, Morocco, Syria, the West Bank and Gaza, and Yemen. They found that almost 24% of adults are involved in some kind of entrepreneurial activity. The majority of entrepreneurs create jobs for others as well as for themselves. The multiplier effect is substantial, with new entrepreneurs generating an average of five jobs. Men are much more likely than women to be involved in entrepreneurial activity.

The researchers found that media coverage of successful businesses can inspire more people to become entrepreneurs. Governments can help by encouraging entrepreneurship in the education system and promoting women’s involvement in business start-ups.