Unemployment rates in the Middle East and North Africa have remained above 10% for the past decade, with youth unemployment at 25%. Many who cannot find work end up in the large informal sector with lower wages and fewer protections. The informal economy makes up around 30-40% of GDP in some countries like Morocco. Bringing the informal sector into the formal economy would boost growth, increase tax revenue, and promote more inclusive development with better jobs and opportunities. However, burdensome regulations, taxes, and weak governance have incentivized many to remain informal. Reforming labor laws, simplifying business regulations, and improving governance could help reduce costs and barriers to formal employment.