Morocco’s business survival rate after five years stands at 53%, according to a report published Tuesday by the World Bank and the Moroccan SME Observatory.
The report points out challenges small businesses face in the country, with many experiencing slow growth despite remaining operational over time.
Entitled “Unleashing the Potential of Morocco’s Private Sector: An Analysis of Business Dynamics and Productivity,” the study found that most formal businesses in Morocco are small.
About 86% of jobs in the country are provided by businesses with ten or fewer employees. The average for OECD (Organisation for Economic Co-operation and Development) countries is only 35%.
Despite their resilience, Moroccan businesses grow slowly. The report shows that the average size of companies with fewer than ten years of activity is still fewer than ten employees. Even more mature firms, with over ten years in operation, only average 26 employees, illustrating a challenge in scaling operations.
The report coincides with a period of economic challenge in Morocco. The unemployment rate increased to 13.7% in the first quarter of 2024, representing a 0.8% rise compared to the same period in 2023. The increase in unemployment figures was largely driven by a severe drought, resulting in the loss of 206,000 jobs in the agricultural sector.