The job market in the Middle East and North Africa (MENA) is poised to weaken notably in 2026 as companies delay hiring amid ongoing regional conflicts, according to a recent report by the World Economic Forum (WEF). The report highlights significant concerns over employment growth and the potential impact on remittance flows from Gulf Cooperation Council (GCC) countries.
The World Economic Forum’s Chief Economists’ Outlook, based on a survey conducted between April 6 and 17, 2026, found that 74 percent of surveyed chief economists anticipate weak or very weak employment growth in the coming year. The report attributes this trend to firms holding back on recruitment due to instability linked to the war involving the US, Israel, and Iran. “Trade, tourism and investment are interrupted with no immediate relief in sight,” the report noted.
The International Labour Organisation (ILO) has similarly warned that ongoing instability threatens millions of jobs, particularly in economies directly affected by conflict, where disruptions to supply chains, diminished foreign investment, and damaged infrastructure are curtailing employment opportunities.
Saadia Zahidi, Managing Director of the World Economic Forum, remarked that the outlook has deteriorated sharply compared to just months ago, when economists were cautiously optimistic. “The conflict in the Middle East changed that, and the economic scarring from the situation thus far is already expected to last into the months ahead,” Zahidi said. She added that prolonged disruptions will disproportionately affect vulnerable populations.
The World Bank has also expressed concern, underscoring that the crisis exacerbates existing challenges, including low productivity growth and limited private sector dynamism, which complicate job creation efforts across the region.
Despite these somber prospects, the Gulf states continue to demonstrate some resilience. Saudi Arabia remains a key driver of talent demand in sectors such as infrastructure, tourism, and energy, propelled by its Vision 2030 development plan. The United Arab Emirates maintains a leading position in recruiting for rapidly growing areas like artificial intelligence, data, finance, and cybersecurity.
Nevertheless, geopolitical uncertainties have started to affect even these wealthier GCC markets. The WEF survey points to job reductions in the Gulf linked to the regional conflict, which are expected to reduce remittance flows. Since foreign workers constitute between 76 and 95 percent of the private sector workforce in GCC countries, disruptions to labor markets and remittances could place further strain on economies that rely heavily on these income streams.
The overall economic outlook for MENA has weakened markedly. Some 88 percent of chief economists surveyed now predict weak or very weak growth in the year ahead—a significant turnaround from January, when the region was considered one of the brighter spots globally. While oil-exporting nations may mitigate some shocks, import-dependent and conflict-affected countries are likely to face more severe economic adjustments.
The report also highlights inflation risks, with 55 percent of chief economists anticipating high or very high inflation in the region. In particular, continued disruption near the Strait of Hormuz could lead to sharp price increases, as the flow of imported goods becomes constrained.