Arab Labor Markets in the Age of Artificial Intelligence: Between Displacement and Empowerment.
By Prof. Khalid Wassef Al-Wazani
Professor of Economics and Public Policy
Mohammed Bin Rashid School of Government
Will artificial intelligence take away our jobs, or will it new ones? This has become one of the most frequently debated questions in economic and social discussions. Yet, in my view, it is not the most important question. The real issue is whether our economies, educational institutions, and labor markets are sufficiently prepared to benefit from the transformations, or the disruptions, that artificial intelligence is bringing about, or whether we will simply bear their costs. This was the central theme of a research paper I presented at the 22nd International Conference of the Middle East Economic Association, hosted by the American University in Cairo on October 20–21, 2026. Entitled “Beyond Job Displacement: The Economics of Artificial Intelligence and the Future of Arab Labor Markets,” the paper examined six Arab economies: The United Arab Emirates, Saudi Arabia, Jordan, Egypt, Morocco, and Tunisia. Its objective was to explore how the impact of artificial intelligence on labor markets differs across these economies and assess their readiness to navigate the resulting transformations.
In this context, estimates by the International Monetary Fund suggest that approximately 40% of jobs worldwide are exposed to artificial intelligence, while the International Labor Organization estimates that around 25% of employment falls within occupations exposed, to varying degrees, to generative AI. Exposure, however, does not necessarily mean job displacement or unemployment. It may instead involve the restructuring of occupational tasks, improvements in worker productivity, or the emergence of entirely new employment opportunities. This distinction represents one of the study’s central findings. Artificial intelligence does not necessarily eliminate entire occupations overnight. Rather, it begins by redistributing tasks between humans and machines. Some routine activities may disappear, while other roles that depend on analytical capabilities, creativity, and human judgment may become more valuable. At the same time, new occupations are emerging in the development, governance, and operation of intelligent systems. Yet these effects will not be uniform across Arab countries, or even across sectors within the same economy.
The study found that in the United Arab Emirates and Saudi Arabia, where digital infrastructure is relatively advanced and investment in technology and sophisticated services is expanding, a larger share of knowledge-intensive occupations may be exposed to transformation. Nevertheless, these economies also enjoy greater opportunities to harness AI to improve productivity and new economic activities. Jordan and Tunisia, meanwhile, possess substantial human capital and well-educated talent. Their principal challenge, however, lies in the limited capacity of their economies to absorb, retain, and translate these skills into productive employment opportunities, rather than continuing to lose qualified professionals through brain drain. In Egypt, opportunities arise from the scale of its domestic market and the expansion of digital services. These opportunities, however, coexist with challenges related to the informal economy and disparities in educational quality and workforce skills. Morocco, for its part, benefits from its industrial linkages and integration into global value chains, creating significant opportunities to apply artificial intelligence in manufacturing and logistics. Realizing these opportunities, however, requires broader diffusion of technology and skills across firms and regions.
The study proposed two analytical frameworks to distinguish between the extent of occupational exposure to artificial intelligence and the economic and institutional readiness required to benefit from it. Perhaps its most important conclusion is that the country with the highest exposure to AI is not necessarily the country facing the greatest risk of job losses. High exposure may represent an opportunity for productivity gains when appropriate skills and institutions are in place. Conversely, low exposure may reflect limited integration into the digital economy rather than genuine protection against unemployment. Building on these findings, the paper proposed four interconnected policy priorities: economic and institutional reform, reskilling, research and development, and regulation.
The challenge is not simply to train individuals to use intelligent applications. It is to rethink education, align skills with actual labor-market demand, encourage firms and institutions to innovate, and protect workers from inequitable transitions. The Arab world also needs more structured regional cooperation in digital skills, scientific research, Arabic-language data, and AI application development. Such cooperation could transform fragmented national markets into a broader economic space for innovation, employment, and production.
Ultimately, the greatest threat to Arab labor markets may not be artificial intelligence itself, but rather the widening gap between the speed of technological advancement and the slow pace at which our educational, economic, and regulatory institutions adapt. Artificial intelligence alone will not determine the future of employment in the Arab world. That future will depend on our ability to translate technology into productivity, skills into employment opportunities, and digital transformation into inclusive development.
The future will not necessarily belong to those who possess the most advanced technology, but to those who are best able to transform it into economic and human value.
Prof. Khalid W. Al Wazani
Arab Labor Markets in the Age of Artificial Intelligence: Between Displacement and Empowerment.
By Prof. Khalid Wassef Al-Wazani
Professor of Economics and Public Policy
Mohammed Bin Rashid School of Government
Will artificial intelligence take away our jobs, or will it new ones? This has become one of the most frequently debated questions in economic and social discussions. Yet, in my view, it is not the most important question. The real issue is whether our economies, educational institutions, and labor markets are sufficiently prepared to benefit from the transformations, or the disruptions, that artificial intelligence is bringing about, or whether we will simply bear their costs. This was the central theme of a research paper I presented at the 22nd International Conference of the Middle East Economic Association, hosted by the American University in Cairo on October 20–21, 2026. Entitled “Beyond Job Displacement: The Economics of Artificial Intelligence and the Future of Arab Labor Markets,” the paper examined six Arab economies: The United Arab Emirates, Saudi Arabia, Jordan, Egypt, Morocco, and Tunisia. Its objective was to explore how the impact of artificial intelligence on labor markets differs across these economies and assess their readiness to navigate the resulting transformations.
In this context, estimates by the International Monetary Fund suggest that approximately 40% of jobs worldwide are exposed to artificial intelligence, while the International Labor Organization estimates that around 25% of employment falls within occupations exposed, to varying degrees, to generative AI. Exposure, however, does not necessarily mean job displacement or unemployment. It may instead involve the restructuring of occupational tasks, improvements in worker productivity, or the emergence of entirely new employment opportunities. This distinction represents one of the study’s central findings. Artificial intelligence does not necessarily eliminate entire occupations overnight. Rather, it begins by redistributing tasks between humans and machines. Some routine activities may disappear, while other roles that depend on analytical capabilities, creativity, and human judgment may become more valuable. At the same time, new occupations are emerging in the development, governance, and operation of intelligent systems. Yet these effects will not be uniform across Arab countries, or even across sectors within the same economy.
The study found that in the United Arab Emirates and Saudi Arabia, where digital infrastructure is relatively advanced and investment in technology and sophisticated services is expanding, a larger share of knowledge-intensive occupations may be exposed to transformation. Nevertheless, these economies also enjoy greater opportunities to harness AI to improve productivity and new economic activities. Jordan and Tunisia, meanwhile, possess substantial human capital and well-educated talent. Their principal challenge, however, lies in the limited capacity of their economies to absorb, retain, and translate these skills into productive employment opportunities, rather than continuing to lose qualified professionals through brain drain. In Egypt, opportunities arise from the scale of its domestic market and the expansion of digital services. These opportunities, however, coexist with challenges related to the informal economy and disparities in educational quality and workforce skills. Morocco, for its part, benefits from its industrial linkages and integration into global value chains, creating significant opportunities to apply artificial intelligence in manufacturing and logistics. Realizing these opportunities, however, requires broader diffusion of technology and skills across firms and regions.
The study proposed two analytical frameworks to distinguish between the extent of occupational exposure to artificial intelligence and the economic and institutional readiness required to benefit from it. Perhaps its most important conclusion is that the country with the highest exposure to AI is not necessarily the country facing the greatest risk of job losses. High exposure may represent an opportunity for productivity gains when appropriate skills and institutions are in place. Conversely, low exposure may reflect limited integration into the digital economy rather than genuine protection against unemployment. Building on these findings, the paper proposed four interconnected policy priorities: economic and institutional reform, reskilling, research and development, and regulation.
The challenge is not simply to train individuals to use intelligent applications. It is to rethink education, align skills with actual labor-market demand, encourage firms and institutions to innovate, and protect workers from inequitable transitions. The Arab world also needs more structured regional cooperation in digital skills, scientific research, Arabic-language data, and AI application development. Such cooperation could transform fragmented national markets into a broader economic space for innovation, employment, and production.
Ultimately, the greatest threat to Arab labor markets may not be artificial intelligence itself, but rather the widening gap between the speed of technological advancement and the slow pace at which our educational, economic, and regulatory institutions adapt. Artificial intelligence alone will not determine the future of employment in the Arab world. That future will depend on our ability to translate technology into productivity, skills into employment opportunities, and digital transformation into inclusive development.
The future will not necessarily belong to those who possess the most advanced technology, but to those who are best able to transform it into economic and human value.
Prof. Khalid W. Al Wazani
Arab Labor Markets in the Age of Artificial Intelligence: Between Displacement and Empowerment.
By Prof. Khalid Wassef Al-Wazani
Professor of Economics and Public Policy
Mohammed Bin Rashid School of Government
Will artificial intelligence take away our jobs, or will it new ones? This has become one of the most frequently debated questions in economic and social discussions. Yet, in my view, it is not the most important question. The real issue is whether our economies, educational institutions, and labor markets are sufficiently prepared to benefit from the transformations, or the disruptions, that artificial intelligence is bringing about, or whether we will simply bear their costs. This was the central theme of a research paper I presented at the 22nd International Conference of the Middle East Economic Association, hosted by the American University in Cairo on October 20–21, 2026. Entitled “Beyond Job Displacement: The Economics of Artificial Intelligence and the Future of Arab Labor Markets,” the paper examined six Arab economies: The United Arab Emirates, Saudi Arabia, Jordan, Egypt, Morocco, and Tunisia. Its objective was to explore how the impact of artificial intelligence on labor markets differs across these economies and assess their readiness to navigate the resulting transformations.
In this context, estimates by the International Monetary Fund suggest that approximately 40% of jobs worldwide are exposed to artificial intelligence, while the International Labor Organization estimates that around 25% of employment falls within occupations exposed, to varying degrees, to generative AI. Exposure, however, does not necessarily mean job displacement or unemployment. It may instead involve the restructuring of occupational tasks, improvements in worker productivity, or the emergence of entirely new employment opportunities. This distinction represents one of the study’s central findings. Artificial intelligence does not necessarily eliminate entire occupations overnight. Rather, it begins by redistributing tasks between humans and machines. Some routine activities may disappear, while other roles that depend on analytical capabilities, creativity, and human judgment may become more valuable. At the same time, new occupations are emerging in the development, governance, and operation of intelligent systems. Yet these effects will not be uniform across Arab countries, or even across sectors within the same economy.
The study found that in the United Arab Emirates and Saudi Arabia, where digital infrastructure is relatively advanced and investment in technology and sophisticated services is expanding, a larger share of knowledge-intensive occupations may be exposed to transformation. Nevertheless, these economies also enjoy greater opportunities to harness AI to improve productivity and new economic activities. Jordan and Tunisia, meanwhile, possess substantial human capital and well-educated talent. Their principal challenge, however, lies in the limited capacity of their economies to absorb, retain, and translate these skills into productive employment opportunities, rather than continuing to lose qualified professionals through brain drain. In Egypt, opportunities arise from the scale of its domestic market and the expansion of digital services. These opportunities, however, coexist with challenges related to the informal economy and disparities in educational quality and workforce skills. Morocco, for its part, benefits from its industrial linkages and integration into global value chains, creating significant opportunities to apply artificial intelligence in manufacturing and logistics. Realizing these opportunities, however, requires broader diffusion of technology and skills across firms and regions.
The study proposed two analytical frameworks to distinguish between the extent of occupational exposure to artificial intelligence and the economic and institutional readiness required to benefit from it. Perhaps its most important conclusion is that the country with the highest exposure to AI is not necessarily the country facing the greatest risk of job losses. High exposure may represent an opportunity for productivity gains when appropriate skills and institutions are in place. Conversely, low exposure may reflect limited integration into the digital economy rather than genuine protection against unemployment. Building on these findings, the paper proposed four interconnected policy priorities: economic and institutional reform, reskilling, research and development, and regulation.
The challenge is not simply to train individuals to use intelligent applications. It is to rethink education, align skills with actual labor-market demand, encourage firms and institutions to innovate, and protect workers from inequitable transitions. The Arab world also needs more structured regional cooperation in digital skills, scientific research, Arabic-language data, and AI application development. Such cooperation could transform fragmented national markets into a broader economic space for innovation, employment, and production.
Ultimately, the greatest threat to Arab labor markets may not be artificial intelligence itself, but rather the widening gap between the speed of technological advancement and the slow pace at which our educational, economic, and regulatory institutions adapt. Artificial intelligence alone will not determine the future of employment in the Arab world. That future will depend on our ability to translate technology into productivity, skills into employment opportunities, and digital transformation into inclusive development.
The future will not necessarily belong to those who possess the most advanced technology, but to those who are best able to transform it into economic and human value.
Prof. Khalid W. Al Wazani
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Arab Labor Markets in the Age of Artificial Intelligence: Between Displacement and Empowerment.
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