North Macedonia can accelerate growth and create more and better-paid jobs with the right reforms.
A targeted set of reforms, focused on strengthening governance, unlocking the potential of private enterprise, and building the skills of workers, particularly young people, could help North Macedonia accelerate economic growth, create thousands of new jobs, and raise living standards for citizens, according to a new analysis by the World Bank Group.
The North Macedonia Growth and Jobs Report finds that without action, the country’s growth is set to slow to an average of 2.4 per cent annually by 2050, well below the pace needed to close the income gap with the European Union. A comprehensive reform package could raise that to 3.8 per cent by 2050, creating an additional 53,000 jobs for those currently outside the labor market and improving pay and working conditions for 196,000 people already in employment by that time.
“North Macedonia’s economic journey since independence is a success story. The question now is how to build on that foundation,” says Carole Megevand, World Bank Group country manager for Kosovo and North Macedonia. “The country has real assets: a talented young population, a strategic location, and growing integration with European markets. This report offers practical solutions to make the most of them and, with the right reforms, accelerate growth, narrow the income gap with the EU, and deliver real opportunities for citizens.”
The report identifies three priority areas for reform. The first, and the one with the largest projected impact, is strengthening economic governance and competition through improvements to public spending efficiency, a more level playing field for businesses, stronger state-owned enterprise governance, and better trade policy and logistics infrastructure.
The second priority is accelerating technology adoption, innovation, and energy efficiency to help firms become more productive and competitive while supporting the country’s green transition.
The third priority is developing skills and mobilizing workers through higher women’s labor force participation, better school-to-work transitions for young people, expanded lifelong learning, and reduced labor market barriers.
The report highlights ICT and professional services as a particularly strong driver of quality employment in North Macedonia, with IT revenue generating nearly twice the jobs of equivalent revenue in other industries. Programming and digital services offer an opportunity to move the economy up the value chain, but seizing it will depend on equipping workers with the right skills for a fast-changing, AI-driven world. The report also identifies the care economy as an underutilised source of formal employment, particularly for women.
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