North Macedonia’s Reform Options Could Add 53,000 Jobs and Raise Living Standards

Carole Megevand, the World Bank Group’s Country Manager for Kosovo and North Macedonia, described the country’s economic progress since independence as a success story with a strong foundation for further development.

North Macedonia could create thousands of jobs and improve living standards through reforms that strengthen governance, support private businesses and equip workers, particularly young people, with better skills. The World Bank Group's North Macedonia Growth and Jobs Report projects average annual growth of 2.4% by 2050 without action, a pace insufficient to close the income gap with the European Union. A comprehensive reform package could lift growth to 3.8% by that time, creating an additional 53,000 jobs for people currently outside the labour market and improving pay and working conditions for 196,000 existing workers.

Better governance could deliver the biggest growth gains

Strengthening economic governance and competition is the report's first reform priority and the area with the largest projected impact, placing the way public institutions spend money and shape business conditions at the centre of the growth challenge. Recommended changes include more efficient public spending, a level playing field for businesses, stronger governance of state-owned enterprises, and improvements to trade policy and logistics infrastructure. These measures would help unlock private enterprise and give firms better conditions to invest, compete and expand employment.

Carole Megevand, the World Bank Group's Country Manager for Kosovo and North Macedonia, described the country's economic progress since independence as a success story with a strong foundation for further development. She highlighted its talented young population, strategic location and growing integration with European markets as assets that reforms could help translate into wider opportunities. The report presents practical ways to build on those strengths, linking faster growth with a narrower EU income gap and tangible improvements for citizens.

Technology and digital services offer higher-quality employment

The second reform priority focuses on faster technology adoption, innovation and energy efficiency, helping businesses become more productive and competitive and supporting North Macedonia's green transition. These changes would strengthen firms' ability to make better use of resources and develop their operations, connecting technological progress with the wider growth agenda. The report places this work alongside governance reforms because stronger businesses and supportive economic institutions are both important to expanding opportunities across the economy.

ICT and professional services stand out as promising sources of quality employment, with IT revenue generating nearly twice as many jobs as equivalent revenue in other industries. Programming and digital services could help North Macedonia move into higher-value economic activities, allowing the country to build on its talent and European market connections. Capturing that potential depends on workers having skills suited to a rapidly changing, AI-driven economy, making workforce development central to the sector's future.

Skills and wider participation could bring more people into work

The third priority is developing skills and bringing more people into the labour market through higher participation among women, better transitions from school to work for young people, expanded lifelong learning and fewer barriers to employment. These recommendations connect the needs of businesses with the opportunities available to people seeking work or adapting to changing job requirements. Stronger routes into employment and continued learning would help more citizens participate in growth and access the jobs created through reform.

The care economy is another underused source of formal employment, particularly for women, offering scope to broaden job opportunities beyond technology and professional services. The report's projections show how a combined reform package could benefit both people currently outside the workforce and those already employed, through new jobs, better pay and improved working conditions. Its recommendations bring governance, business productivity and workforce participation together around the goal of faster growth that raises living standards across North Macedonia.