Casablanca – Morocco’s labor market showed signs of improvement in 2025, with a modest decline in the national unemployment rate and a rebound in job creation, according to the latest data from the High Commission for Planning (HCP). However, the recovery remains uneven, as structural challenges continue to affect key segments of the population, particularly young people, women, and workers in rural areas. At the same time, underemployment and job quality concerns have intensified, highlighting the limits of recent gains.

Unemployment declines slightly

The national unemployment rate fell from 13.3% in 2024 to 13% in 2025, marking a reduction of 0.3 percentage points. In absolute terms, the number of unemployed people decreased by about 17,000, bringing the total to 1.621 million. This decline reflects both urban and rural trends, with unemployment dropping from 16.9% to 16.4% in urban areas and from 6.8% to 6.6% in rural areas.

Despite this overall improvement, unemployment levels remain high by historical standards, close to their highest point since at least 2017. The stability of the activity rate — the share of the working-age population that is employed or actively seeking work — at 43.5% has contributed to the persistence of unemployment. After several years of decline, which had eased labor market pressures by reducing participation, the stabilization of the activity rate has increased competition for available jobs.

Job creation rebounds, driven by urban areas

Between 2024 and 2025, Morocco’s economy created a net total of 193,000 jobs, a significant improvement compared with the 82,000 jobs created in the previous year. However, this progress was unevenly distributed. Urban areas accounted for 203,000 new jobs, while rural areas recorded a net loss of 10,000 positions, underscoring the continued vulnerability of rural employment.

By type of employment, job growth was driven entirely by paid work, which increased by 249,000 positions. At the same time, unpaid work declined by 55,000, reflecting a gradual shift toward more formal and structured forms of employment. While this trend points to improvements in job quality, it has not been sufficient to absorb the growing labor force fully.

Services lead sectoral job creation

Sectoral data show that the services sector remained the main engine of employment growth in 2025, generating 123,000 new jobs. Within services, the strongest contributions came from financial, insurance, real estate, scientific, technical, administrative, and support activities, as well as social services provided to communities.

Construction and public works (BTP) followed, creating 64,000 jobs, reflecting ongoing infrastructure and real estate activity. The industrial sector added 46,000 jobs, supported by manufacturing and related activities. In contrast, agriculture, forestry, and fishing continued to face difficulties, losing 41,000 jobs overall, primarily in rural areas, although some job gains were recorded in urban agricultural activities.

This sectoral distribution highlights the increasing weight of non-agricultural activities in Morocco’s employment structure, particularly in cities, while rural regions remain exposed to climate conditions, productivity constraints, and limited diversification.

Persistent gaps across gender and age

Despite the decline in the overall unemployment rate, disparities across demographic groups remain pronounced. Unemployment among women rose from 19.4% to 20.5% in 2025, an increase of 1.1 percentage points, while the rate among men declined from 11.6% to 10.8%. This divergence reflects structural barriers to female labor market participation, including limited access to suitable jobs, childcare constraints, and occupational segregation.

Young people remain the most affected group. The unemployment rate among those aged 15 to 24 increased from 36.7% to 37.2%, reaching one of the highest levels recorded in recent years. For the 25–34 age group, unemployment edged down slightly from 21% to 20.9%, while larger declines were observed among those aged 35–44 and 45 and over, whose rates fell to 7.2% and 3.6%, respectively.

These figures suggest that the labor market continues to struggle to integrate new entrants, particularly young graduates and first-time job seekers, even as employment conditions improve for more experienced workers.

Graduates face mixed outcomes

By educational attainment, the unemployment rate among degree holders declined slightly from 19.6% to 19.1%, while the rate among individuals without diplomas also fell, from 5.2% to 4.7%. The most significant improvements were recorded among technicians and mid-level professionals, whose unemployment rate declined by more than two percentage points, and among those with vocational qualifications.

Nevertheless, nearly three-quarters of unemployed individuals who had previously worked hold some form of diploma, raising concerns about the alignment between education and labor market needs. This mismatch continues to challenge Morocco’s ability to translate educational investment into sustainable employment opportunities.

Long-term unemployment on the rise

Another notable feature of the 2025 labor market is the increase in long-term unemployment. The share of unemployed individuals who have been out of work for one year or more rose from 62.4% to 64.8%, and the average duration of unemployment increased from 31 months to 33 months. In addition, the proportion of first-time job seekers grew from 49.3% to 52.9%.

These trends point to growing difficulties in reintegrating job seekers into the labor market, particularly young people and graduates, and raise concerns about skills depreciation, discouragement, and long-term social and economic costs.

Underemployment Intensifies

While unemployment declined, underemployment increased significantly in 2025. The number of underemployed workers rose from 1.082 million to 1.190 million, pushing the national underemployment rate from 10.1% to 10.9%. Underemployment remains more prevalent in rural areas, where the rate reached 13.2%, compared with 9.6% in urban areas.

All sectors experienced increases in underemployment, with the construction sector recording the largest rise, from 19.6% to 21.7%. Agriculture, forestry, and fishing saw underemployment increase to 12.9%, while industry and services recorded rates of 7.1% and 8.4%, respectively. These figures reflect the prevalence of seasonal, casual, or low-income work and highlight ongoing challenges related to job quality, stability, and productivity.

Underemployment related to insufficient working hours increased to 617,000 people, while underemployment linked to inadequate income or mismatch between training and job requirements rose to 573,000. Together, these trends indicate that a growing share of workers remains unable to secure adequate and sustainable employment conditions.

Regional disparities persist

Labor market outcomes continue to vary significantly across regions. Five regions account for more than 72% of the active population: Casablanca–Settat, Rabat–Salé–Kenitra, Marrakech–Safi, Fès–Meknès, and Tanger–Tétouan–Al Hoceima. Casablanca–Settat alone represents over one-fifth of the country’s active population and more than a quarter of its unemployed.

Unemployment rates are highest in the southern regions and the Oriental region, where they exceed 22%, well above the national average. By contrast, Marrakech–Safi, Drâa–Tafilalet, and Tanger–Tétouan–Al Hoceima recorded the lowest rates, all below 10%. These disparities reflect differences in economic structure, investment levels, sectoral specialization, and regional development dynamics.

Outlook and policy implications

The 2025 labor market data suggest that Morocco is making gradual progress in job creation, particularly in urban areas and service-oriented sectors. However, the persistence of high unemployment among young people and women, the rise in long-term unemployment, and the expansion of underemployment indicate that the recovery remains fragile and incomplete.

Addressing these challenges will likely require a multifaceted approach, including measures to strengthen job quality, improve the alignment between education and labor market needs, promote female labor force participation, and support rural employment diversification. At the same time, continued investment in productive sectors, infrastructure, and regional development will be essential to sustain job creation and reduce structural imbalances.

While 2025 marked a year of relative improvement in employment dynamics, Morocco’s labor market continues to face deep-rooted challenges that will shape economic and social outcomes in the years ahead.