Al Jazeera Net correspondents
The Middle East and North Africa region witnessed wide repercussions as a result of the rise in global interest rates and the decline in the value of currencies, which led to inflationary pressures that affected the lives of the population, especially with the continued recovery from the Corona pandemic, and the impact of the Russian invasion of Ukraine and the Israeli aggression on Gaza.
This led to a slowdown in economic growth over the past two years, which had a negative impact on employment and wages, according to the World Bank, in addition to its impact on the budgets of Arab countries for the year 2025.
The salaries and wages block constitutes a large part of the budgets of Arab countries, as in Saudi Arabia it amounts to 43.6% of expenditures with a value of 561 billion Saudi riyals (about 149.6 billion dollars), and in Algeria it amounts to 5843 billion Algerian dinars (about 43 billion dollars), representing 34.79% of Budget.
In this report by Al Jazeera Net, we review the size of salaries and wages in the public sector in a number of Arab countries for the year 2025, and their impact on public budgets and economic development.
But before going into the details, we will first talk about:
The economic situation in the Arab region in 2025
The regional and global shocks that struck the region over the past years led to an increase in the number of unemployed people by more than 5 million people, which is more than the already high levels of unemployment that characterized the region even before the spread of the Corona pandemic, according to the Economic Research Forum.
With negative shocks, demand for labor declines, leading to an undesirable balance between high unemployment rates and low real salaries and wages. Improving the elasticity of real wages is one way to reduce the living burdens facing families.
Despite recurring crises in the region, the World Bank and the International Monetary Fund expect that most Middle Eastern and North African economies will record a rise in economic growth during 2025. However, structural challenges, political instability, and geopolitical tensions will remain major obstacles to achieving sustainable development.
Increased unemployment and poor wages
The World Bank expects overall growth in the Middle East and North Africa region to rise to 3.8% in 2025, compared to 2.2% in 2024.
However, this growth has not been reflected in sufficient job creation or improved wages, and the youth unemployment rate is expected to remain above 24%, which poses a continuing threat to social stability.
Weak public budgets and high inflation
The public budgets of countries in the region are witnessing continuing pressure, as a decline in oil revenues in 2024 has led to the narrowing of surpluses in the economies of the Gulf Cooperation Council countries.
Oil-exporting developing countries are expected to face a fiscal deficit of 5.5% of GDP in 2025, while oil-importing countries continue to face a fiscal and current account deficit, with public debt rising, according to the World Bank.
Inflation is expected to rise slightly to 2.7% in 2025, with variation between countries in the region: 2% in the Gulf Cooperation Council countries, 4.9% in developing economies, and severe inflationary pressures in countries such as Yemen (20.7%) and Egypt (17.2%). ). This inflation will erode the purchasing power of families, deepening the social and economic gaps in the region.
The importance of increasing salaries and wages in stimulating the economy
According to the Investopedia platform, salary increases directly and positively affect the economy across several axes:
- Improving the standard of living: The increase in salaries helps provide sufficient income for workers to cover the increasing costs of living, enhancing their quality of life.
- Reducing poverty rates: With increased salaries, many low-income families can cross the poverty line, improving their financial and social stability.
- Reducing government support: Higher salaries reduce the need for financial aid provided by governments, which reduces the burden of public spending.
- Raising productivity and morale: High wages improve worker morale, which motivates them to work more efficiently and increase their productivity, especially among workers with low salaries.
- Increased employee stability: Improving salaries reduces the movement of employees to other jobs, especially for the private sector, which reduces costs associated with recruitment and training.
- Promoting economic growth: High salaries provide greater financial liquidity, which leads to increased consumption and stimulates trade and industry, thus achieving sustainable economic growth.
What is the value of the wages and salaries block in the budgets of Arab countries in 2025?
The salaries and wages block constitutes a large percentage of most Arab countries’ budgets for the year 2025, as we mentioned above. Below is a list of the 9 most prominent Arab countries in terms of the size of the salaries they provide to their employees in the 2025 budget:
1- Egypt
- General budget 2024-2025: 6.4 trillion pounds ($135.4 billion).
- Value of salaries and wages: 575 billion pounds ($12 billion).
- Percentage of salaries from the budget: 8.86%.
- Average monthly salaries: 13,244 pounds ($428.59)
- Per capita income from GDP: 21.61 thousand dollars annually.
2- Saudi Arabia
- General budget 2025: 1,285 billion Saudi riyals ($342.6 billion).
- Value of salaries and wages: 561 billion Saudi riyals ($149.4 billion).
- Percentage of salaries from the budget: 43.6%.
- Average monthly salaries: 10,000 riyals ($2,666).
- Per capita income from GDP: 65.88 thousand dollars annually.
3- Morocco
- General Budget 2025: 721 billion dirhams ($72.1 billion).
- Value of salaries and wages: 180 billion dirhams ($18 billion).
- Salaries percentage of the budget: 25%.
- Average monthly salaries: 5,000-10,000 dirhams ($500-1,000).
- Per capita income from GDP: 11.1 thousand dollars annually.
- Note: Public sector salaries are expected to rise to 192.8 billion dirhams ($19.1 billion) by 2026.
4- Algeria
- General Budget 2025: 16.700 billion dinars ($128 billion).
- Value of salaries and wages: 5.843 billion dinars ($43 billion).
- Percentage of salaries from the budget: 34.79%.
- Average monthly salaries: 30,000-60,000 dinars ($220-440).
- Per capita income from GDP: 18.34 thousand dollars annually.
5- Qatar
- General budget 2025: 210.2 billion Qatari riyals ($57.6 billion).
- Value of salaries and wages: 67.5 billion riyals ($18.5 billion).
- Percentage of salaries from the budget: 32.1%.
- Average monthly salaries: 15,800 riyals ($4,340).
- Per capita income from GDP: 118.76 thousand dollars annually.
- Note: Salaries vary widely between sectors, with additional benefits such as housing and transportation allowances.
6- Kuwait
- General budget 2024/25: 24.5 billion Kuwaiti dinars ($79.4 billion).
- Value of salaries and wages: 9.89 billion dinars ($32 billion).
- Percentage of salaries from the budget: 40.2%.
- Average monthly salaries: 1000-3000 dinars ($3243-9730).
- Per capita income from GDP: 51.29 thousand dollars annually.
7- Sultanate of Oman
- General budget 2025: 11.8 billion Omani riyals ($30.6 billion).
- Percentage of salaries from the budget: 42% of social spending.
- Average monthly salaries: 450-2200 riyals ($1169-5718).
- Per capita income from GDP: 42.36 thousand dollars annually.
8- UAE
- General Budget 2025: 71.5 billion dirhams ($19.5 billion) with local budgets for the Emirates.
- Value of salaries and wages: 26% of total expenses in some emirates (such as Dubai).
- Average monthly salaries: 12,000-20,000 dirhams ($3,267-5,445).
- Per capita income from GDP: 82 thousand dollars annually.
- Note: Salaries vary by sector, and Dubai and Abu Dhabi have high standards of living and competitive work environments.
9- Jordan
- General budget 2025: 12.51 billion dinars ($17.62 billion).
- Value of salaries and wages: 6.63 billion dinars ($9.3 billion).
- Salaries percentage of the budget: 60%.
- Average monthly salaries: 600-800 dinars ($850-1130).
- Per capita income from GDP: 11.38 thousand dollars annually.
- Note: Salaries constitute a large portion of current expenditures and include civil and military retirement allocations.
