Growth and Employment in Morocco: Rereading Bank Al-Maghrib’s 2025 Annual Report in Light of the Empirical Literature

Bank Al-Maghrib’s 2025 annual report documents a notable macroeconomic consolidation: GDP growth of around 4.9%, inflation brought down to a low pace (close to 0.8%), and a recovery in investment, in an international environment that remains exposed to shocks (Bank Al-Maghrib, 2026). These aggregates, however, do not close the analysis. Rather, they open a classic question in development economics: to what extent is growth transmitted to the labor market?

National data from the Haut-Commissariat au Plan (High Commission for Planning) confirm the relevance of this question. In 2025, the Moroccan economy created around 193,000 net jobs, while the national unemployment rate declined only slightly, from 13.3% to 13.0% (HCP, 2026a). A subsequent quarterly improvement in unemployment, measured according to a stricter definition under the new survey framework (HCP, 2026b), does not erase the underlying diagnosis: the growth–employment relationship remains structurally constrained.

This diagnosis is part of an extensive international literature on “jobless growth” (jobless growth) and on the employment–GDP elasticity. In a large sample of developing economies, Burgi, Hovhannisyan and Mondragon-Velez (2024) show that GDP–employment elasticities are, in most cases, below unity: employment grows more slowly than GDP because of productivity gains. Agriculture, in particular, often displays low or even negative elasticities. This result is consistent with the Kaldorian interpretation of Wells and Thirlwall (2003), according to which sectoral increasing returns imply employment elasticities well below one.

Okun’s law provides a second frame of reference. Ball, Furceri, Leigh and Loungani (2016) establish that the Okun coefficient — the sensitivity of unemployment to output fluctuations — is, on average, about half as large in developing economies as in advanced economies (around −0.2 versus −0.4). The ILO (Kapsos et al., 2021) reaches similar conclusions: the responsiveness of unemployment to growth varies widely across regions, degrees of informality and sectoral structures. In other words, a macroeconomic recovery does not guarantee a symmetrical fall in unemployment.

For Morocco, the available empirical work points in the same direction. Ezzahidi and El Alaoui (2014) estimate a positive but weak growth–employment elasticity and document a marked decline in this elasticity between the 1990s and the 2000s (from around 0.74 to about 0.38 depending on the sub-period). Sectoral intensities appear heterogeneous, with some sectors even being net destroyers of jobs over ten-year averages. More recently, ARDL estimates of Okun’s law for Morocco (2000–2022) reveal an asymmetry — unemployment reacts more strongly to contractions than to expansions — as well as a persistence consistent with hysteresis effects (recent studies using Moroccan quarterly data).

Three analytical mechanisms help organize these facts. First, a composition channel: growth driven by capital-intensive sectors, or by productivity gains, raises GDP without proportionally absorbing labor (Burgi et al., 2024). Second, an allocation channel: the mismatch between education and jobs and graduate unemployment, highlighted in HCP statistics, limit the translation of labor supply into stable jobs. Third, a quality channel: informality, underemployment and precariousness weaken the link between “net job creation” and actual improvements in well-being.

From this perspective, the message of Bank Al-Maghrib’s report — that macroeconomic progress still needs to translate more clearly into social advances — is not a rhetorical formula. It echoes the international empirical consensus: stabilization (inflation, investment, public finances) is a necessary, but rarely sufficient, condition for inclusive employment dynamics. The economic policy implications follow without slogans. The aim is to raise the employment content of growth — through the sectoral composition of investment, the reduction of skills frictions and support for a productive fabric (SMEs) that creates quality jobs — rather than treating the growth rate as a self-sufficient indicator.

In conclusion, the Moroccan case in 2025 illustrates a configuration well identified in the comparative literature: consolidated aggregates coexisting with still insufficient absorption of labor. The analytical challenge is no longer merely to document the recovery, but to estimate and improve the employment–GDP elasticity, as well as the quality of job placements, with a view to structural transformation.