Shafaq News
Each year, roughly 200,000 Iraqiscomplete university and technical education, believing their qualificationswill secure them stable employment. Instead, many enter a labor marketstruggling to keep pace with the growing number of graduates, leaving thousandsunable to find work despite their degrees.
For a new generation of Iraqis,graduation no longer marks the start of professional life. It often signals thebeginning of an uncertain search for work, with many competing for a shrinkingpool of government jobs, accepting positions unrelated to their qualifications,or looking abroad for opportunities.
The pressure continues to mount in acountry whose population is approaching 47 million, according to World Bankestimates, while hundreds of thousands of young Iraqis reach working age eachyear.
Absorbing that expanding workforcehas become one of Iraq's biggest economic challenges. Although oil generatesabout 90% to 95% of government revenue, the sector creates relatively few jobscompared with its outsized role in the economy.
That imbalance has also narrowed thestate's ability to remain the employer of last resort. Around 70% of publicspending is allocated to salaries and wages, according to Ministry of Financedata, leaving limited fiscal space to expand government hiring or investheavily in sectors capable of generating jobs on a larger scale.
For decades, public-sectoremployment offered Iraqi graduates the clearest path to financial stability. Government jobs provided better pay, stronger benefits, and greater securitythan much of the private sector. But as state payrolls expanded and fiscalpressures intensified, that pathway steadily narrowed, forcing a growing numberof graduates to compete for fewer positions.
Universities, meanwhile, havecontinued producing ever-larger graduating classes.
Over the past two decades, Iraq hassignificantly expanded access to higher education, opening universities andtechnical institutes across the country. Ministry of Higher Education data fromthe 2024–25 academic year illustrate the scale of that expansion, with morethan 52,000 students admitted to education and basic education programs, 29,160to science, 25,076 to administration and economics, and 21,047 to engineering,while medicine, dentistry, and pharmacy together enrolled more than 9,300students. Yet many graduates continue to set their sights on public-sectoremployment because private companies remain too small to absorb the country'sgrowing pool of job seekers.
The imbalance extends beyond therising number of graduates. Economists point to a widening disconnect betweenwhat universities produce and what Iraq's economy actually needs.
"Iraq's efforts to reducedependence on oil require stronger manufacturing, technology, and serviceindustries, but these sectors have not expanded quickly enough to create enoughpositions for the country's growing workforce," economic expert MudherSaleh told Shafaq News, adding that a university degree remains highly valuedsocially, but for many young Iraqis it no longer guarantees a clear careerpath.
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Crude but Jobless
Despite holding some of the world’slargest oil reserves and generating billions of dollars from crude exports,Iraq’s petroleum sector is highly capital-intensive. It provides substantialgovernment revenue but cannot absorb the hundreds of thousands of peoplejoining the labor market every year.
The World Bank and the InternationalMonetary Fund (IMF) have repeatedly pointed to Iraq’s dependence on oil, weakprivate-sector development and limited job creation as among the country’s mostpressing structural economic challenges.
The strain is reflected in the labormarket. Iraq’s Ministry of Planning estimated unemployment at around 13% in2025, while other estimates placed it at 15.5% during the first half of 2026.Youth unemployment remains considerably higher, ranging between 28% and 32%,placing Iraq among the countries with the highest youth unemployment rates inthe region.
International economist Nawaral-Saadi attributed Iraq’s unemployment crisis to a combination of economic,administrative and political failures rather than a single underlying cause.
“Iraq possesses significantfinancial, natural and human resources, but many institutions continue tooperate under a quota-based system rather than standards of competence andachievement,” al-Saadi informed Shafaq News. He maintained that this approachhas slowed development projects, weakened economic planning and discouragedinvestment opportunities capable of generating thousands of jobs.
The consequences extend well beyondeconomic indicators.
Economic expert Ziad al-Hashemistressed that successive Iraqi governments have failed to establish stableeconomic institutions, create an investment climate attractive to businesses ordevelop legislation capable of encouraging investment and diversifying theeconomy.
“Political parties bear asignificant share of the responsibility after turning ministries, governmentagencies and state-owned companies into areas of influence and sources offinancial gain,” he told Shafaq News, arguing that this has expanded public-sectoremployment beyond sustainable levels.
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Protest over Payroll
For many young Iraqis, unemploymenthas evolved from an economic challenge into a recurring source of publicfrustration.
Across Baghdad and provincesincluding Dhi Qar, Basra, Maysan, Najaf and other southern provinces,unemployed graduates have repeatedly taken to the streets to demand governmenthiring, recruitment opportunities and practical solutions after years of searchingfor work.
Gatherings outside ministries,provincial administrations and other government institutions have become afamiliar feature of Iraq’s public life, reflecting growing frustration amonggraduates who see few pathways into stable employment.
The issue also stood at the centerof the 2019 Tishreen anti-government protests, when thousands of young Iraqispointed to unemployment, corruption and deteriorating public services as amongthe main drivers of their anger.
The demonstrations did not end withthe Tishreen movement. Graduate protests persisted in the years that followed,including throughout 2025 and 2026, as each new wave of university graduatesjoined a labor market where opportunities remained far below demand.
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Missing Engine
Successive Iraqi governments haverepeatedly presented private-sector growth as the long-term answer to thecountry’s employment challenge. For many economists, however, the sectorremains too small, too reliant on public spending and too underdeveloped toabsorb the hundreds of thousands of Iraqis entering the labor market each year.
The IMF reached a similar conclusionin its 2025 report, pointing to weak private-sector development as one ofIraq’s main structural economic challenges and warning that limited economicdiversification has left the country heavily dependent on public employment andoil revenues.
Much of the problem lies in theprivate sector’s relationship with the state. Many businesses continue to relyheavily on government contracts and public expenditure, limiting their abilityto expand independently and generate large numbers of sustainable jobs.
Mohammed al-Najjar, executivedirector of the Iraq Development Fund, acknowledged that private companies havecreated employment opportunities but maintained that much of that growthremains tied to government-funded projects and state spending.
“The private sector’s ability togenerate more jobs will remain limited unless legislative reforms allowbusinesses to operate more independently,” he conveyed to Shafaq News.
Recognizing those constraints, thegovernment has introduced several initiatives aimed at narrowing the gapbetween education and employment. Under its “Iraq 2050” vision, Baghdad seeksto reduce its reliance on oil while strengthening productive sectors andexpanding the private sector’s role in the economy.
The Ministry of Labor and SocialAffairs has also expanded vocational training programs while promoting theestablishment of a Higher Council for Training to improve coordination betweeneducational institutions and labor-market needs.
Al-Najjar, however, maintained thattraining alone will not resolve the employment crisis unless Iraq also developsindustries and businesses capable of absorbing those newly acquired skills.
“Without broader economicdiversification, stronger private-sector growth and reforms that create spacefor investment and job creation, Iraq’s graduate boom will continue to outpacethe country’s ability to provide employment,” he stated.
In his view, the shortage of jobsfacing Iraqi graduates reflects a broader challenge that has shaped Iraq’seconomy for years: attracting enough investment to build industries, expandbusinesses and generate employment on a meaningful scale.
Former deputy head of Parliament’sInvestment Committee, Suzan Mansour, shared a similar assessment, arguing thatIraq’s investment priorities have often favored housing developments overproductive industries capable of strengthening the economy and expandingemployment opportunities.
Urging the National InvestmentCommission to redirect investment toward projects that increase production,generate jobs, and deliver stronger economic returns, she noted that Iraqcontinues to import a large share of its food and consumer goods even as farmersstruggle with rising production costs, limited access to agricultural supplies,and difficulties reaching markets.
Expanding those productive sectors,she added, would not only provide employment opportunities for graduates andyoung workers but also reduce dependence on imports and establish thefoundation for a more diversified economy.
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Unlocking the Potential
Although Iraq has secured severalmajor energy and infrastructure investments in recent years, a number ofhigh-profile projects have been delayed, suspended, or abandoned, limitingtheir potential to stimulate economic growth and generate employment.
For international economist Nawaral-Saadi, the impact extends far beyond construction delays or lost investment. Every stalled industrial project, he maintained, represents factories that werenever built, businesses that never opened, and jobs that never materialized fora workforce expanding year after year.
“Iraq possesses significantfinancial, natural, and human resources, but many institutions are operatingbelow the standards needed for competence and achievement,” al-Saadi toldShafaq News, attributing persistent project delays, weak development planning,and missed investment opportunities to poor management and political influencewhile noting that thousands of potential jobs have been lost as a result.
Several flagship projects illustratethose challenges.
In February 2024, Iraq’s Ministry ofIndustry and Minerals disclosed that Shell had withdrawn from the NibrasPetrochemicals Project in Basra, which had been planned as one of the largestpetrochemical complexes in the Middle East.
The project was expected to producearound 1.8 million metric tons annually and was widely viewed as a major steptoward reducing Iraq’s dependence on crude oil exports by developinghigher-value industries linked to the country’s energy sector.
Investment challenges have not beenconfined to the energy industry. South Korea’s Hanwha Engineering &Construction withdrew from the Bismayah residential city project in 2020 beforelater returning after reaching new agreements with the Iraqi government overfinancial and implementation issues.
As Iraq continues to confront thechallenge of creating enough opportunities for its growing workforce, thousandsof graduates are entering a job market where the path from education toemployment remains uncertain. For many, the years spent preparing for a careerare followed by a new challenge: finding where their education fits in aneconomy still searching for balance.
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Written and Edited by Shafaq NewsStaff.