Labor market in Somalia

The labor force participation rate measures the share of people of working age who work or actively seek work. Somalia's 2022 Somalia Integrated Household Budget Survey recorded participation of 25.9% among people aged 15 and older and an employment rate of 21.7%. Participation was 39.9% for men and 15.4% for women. The employment rate was 32.9% for men and 12.2% for women. Unemployment was higher in urban areas at 19.3% than in rural areas at 10.6% or among nomadic populations at 5.4%, while urban youth unemployment reached 35.6%. The 2019 Labour Force Survey reported different figures, including 32.4% participation, 25.5% employment and 21.4% unemployment, so the two surveys should not be treated as a direct time trend. Nearly half of employed people were below the poverty line, reflecting low productivity and limited earnings. Services accounted for 59.9% of employment in the 2019 survey, followed by industry at 18.0% and agriculture at 13.5%. Common activities included other services, farming and fishing, manufacturing, education, health and social work, administration, accommodation and food, retail, construction, transport and information and communication. The 2024 Somalia Integrated Business Establishment Census found that wholesale, retail and vehicle repair represented 59.9% of the workforce in fixed-location urban businesses, followed by accommodation and food at 12.8% and manufacturing at 6.4%. This census excluded agriculture, public administration, household activities and mobile traders, so it does not describe the whole labor market. Around 95% of newly created jobs are attributed to the private sector. Commerce and consumer services are widespread, but productive sectors, medium-sized small and medium enterprises, finance, energy, transport and logistics, information and communication technology, water, education and business services face development gaps. Formal businesses and public institutions are concentrated in places such as Banadir, Waqooyi Galbeed, Bari, Nugaal and Mudug. Census figures covered 120,475 formal and 64,745 informal workers in the surveyed urban centers, but the coverage does not support a complete national or Federal Member State ranking. Education and training do not yet match demand consistently. In the 2019 survey, education was not stated for 60.1% of workers; 13.4% had secondary education, 7.4% university education and 0.8% vocational education. About 7.6% had technical or vocational training. Training is often short, urban-based and self-financed; 47.3% of participants financed it themselves. Frequently reported skills include tailoring, carpentry, electrical work, beauty services, computing, nursing and vehicle mechanics. Employers also report gaps in digital and information technology skills, electrical work, construction and masonry, plumbing, solar energy, hospitality, agribusiness, management, English and other workplace skills. In 2019, 44.2% of people aged 15 to 24 were not in employment, education or training, including 50.2% of young women and 37.7% of young men. The National Employment Service Centre, or NESC, operated by the Ministry of Labour and Social Affairs, provides a job portal, job links, CV and interview support, career counselling, skills audits, training, job fairs, screening, matching, work trials, internships and apprenticeships. Employers can publish vacancies through NESC without a posting fee. Informal matching also takes place through family, clan, diaspora and business networks, local markets, self-employment and household enterprises. The Labour Market Information and Analysis System is being developed, but substantial data gaps remain. Rural and nomadic communities, women, young people, internally displaced people, people with disabilities and people whose education was interrupted face higher access barriers. No nationally uniform processing times, admission rules or private placement fees are reliably established. The Ministry of Labour and Social Affairs handles labor policy, labor administration, employment creation, technical and vocational skills, foreign workers and occupational safety and health. The Somali National Bureau of Statistics produces surveys and business registers, while the Federal Government and Federal Member States coordinate implementation. Trade unions, including FESTU, employer associations, private agencies, NGOs and United Nations organizations also support delivery. The Somali Labour Code, Law No. 36 of 2024, entered into force on 4 February 2025 and provides a national framework for contracts, wages, working conditions, occupational safety and health, freedom of association, collective bargaining and dispute resolution. Enforcement and coverage remain more limited in informal work. Somalia has no reliably established current national wage series or median wage, and the general minimum-wage amount has not been substantiated. The Ministry is responsible for wage monitoring, public-service pay and grading, and development of a national minimum wage. The National Employment Policy 2019 prioritizes private businesses, productive sectors, skills, labor-market governance and inclusion of women, young people, internally displaced people and people with disabilities. The National Transformation Plan 2025–2029 provides the current wider development framework. A young and rapidly growing population, urbanization, insecurity, displacement, droughts, floods, climate stress and dependence on aid and imports continue to change labor supply and demand. A current World Bank country overview cited in the research estimates about 500,000 new labor-market entrants each year compared with roughly 80,000 jobs created. Agriculture, livestock and fisheries value chains, construction, hospitality, renewable energy, digital finance, information technology, logistics and regional trade offer areas of potential growth. Migration is closely connected with work and household income. The 2019 survey found that 8.1% of people had moved during the previous five years, with natural disasters and insecurity among the most frequent reasons. Remittances were estimated at about USD 864.7 million per year; 28.82% of households received them, and 83.7% of recipient households received money monthly. Urban households received 93.3% of the recorded remittance total. Somalia is a country of origin, transit and destination for labor migration. The National Labour Migration Policy 2025 and Regulation No. 181 of 2025 establish a rights-based framework for safe, orderly and regular mobility. The 2025 regulations for private employment agencies address licensing, oversight, fair recruitment and worker protection, but coordination, inspections, complaint mechanisms and designated focal points were still being developed in 2026.