A new report by the International Labour Organization (ILO) finds that digitalization and artificial intelligence (AI) could bring significant economic benefits to the Arab States region, but highlights potential risks for women, low-skilled workers, and older employees.
The study, Navigating the digital and artificial intelligence revolution in Arab labour markets: Trends, challenges and opportunities, projects that by 2035 AI integration could generate US$14.1 billion in additional GDP and create a net 118,000 new jobs. Nearly 14.6% of jobs—around 8 million—could benefit from AI-driven augmentation, where technology enhances rather than replaces human work. At the same time, roughly 2.2% of jobs—about 1.2 million—may be at risk of automation due to generative AI.
Sector and Demographic Impacts
The report finds that sectors such as construction, transport, teaching, personal services, and engineering are likely to see net job gains, while public services, basic manufacturing, retail, and routine clerical work may experience declines in the Arab region.
Women are disproportionately affected by automation risks, holding more than three times the share of jobs at risk (5.3%) compared to men (1.6%). However, women could also see greater benefits from AI augmentation, with 22.7% of female-held jobs potentially enhanced versus 13% for men. The report emphasizes that without targeted policies, women may face fewer overall job opportunities by 2035.
Youth aged 15–24 are more likely to benefit from new AI-driven roles, while older workers and other vulnerable groups—including low-skilled workers, migrants, refugees, and persons with disabilities—may face exclusion without reskilling and support. In the Arab workforce, targeted support can change this narrative.
Policy Recommendations
The ILO stresses that outcomes will hinge on government policies, including:
- Investing in digital infrastructure and reducing the digital divide, especially in rural and conflict-affected areas.
- Embedding digital literacy, STEM education, and lifelong learning into education and training systems.
- Strengthening social protection and employment services to help workers adapt to technological disruption.
- Supporting micro, small, and medium-sized enterprises in adopting digital tools.
- Updating labour laws to protect workers in the digital economy, including platform and gig workers.
- Promoting social dialogue among governments, employers, and workers in Arab countries.
- Enhancing regional and international cooperation to reduce disparities in digital readiness.
“Digitalization and AI adoption in the labour market do not have to imply job destruction,” said Ruba Jaradat, ILO Regional Director for Arab States. “The real benefits can only be realized if governments, employers, and workers take deliberate steps to ensure the transition is inclusive and fair.”
Regional Scope
The report covers 11 Arab States: Bahrain, Iraq, Jordan, Kuwait, Lebanon, Oman, Qatar, Saudi Arabia, the State of Palestine, Syria, the United Arab Emirates, and Yemen. Its findings will guide ILO support to governments and social partners in developing strategies that translate digital transformation into tangible labor market outcomes.
