The industrialisation paradox: Public investment and labour market fragmentation in Setif, Algeria

• Tahar Kharchi

  University Lecturer and Researcher, Teacher Education College of Setif, Algeria

• Fodhil Boudjllal

  University Lecturer and Researcher, Constantine 1 – Frères Mentouri, Algeria

This article investigates the structural disconnect between public industrial investment and labour market outcomes in Setif Wilaya, Algeria's second most populous province and a nationally designated industrial hub. Drawing on the 2025 Wilaya Statistical Yearbook — an official primary source comprising detailed commune-level data for all 60 communes — and complementary data from the ONS (National Office of Statistics), World Bank, IMF, and UNCTAD, we document a profound accountability paradox: despite the public allocation of 2,455 hectares of serviced industrial land across four industrial zones and 39 activity zones, the aggregate enterprise activation rate barely exceeds 40%, while the flagship Ouled Saber zone records a critical activation rate of 3.7%. Concurrently, the wilaya posts a mean unemployment rate of 19.1%, with extreme inter-communal dispersion ranging from 10.0% to 40.4%, and a job-offer coverage ratio of only 26.4%. We construct a Labour Market Stress Index (LMSI) for all 60 communes, integrating unemployment, activity rates, female labour exclusion, and job-offer coverage into a single composite indicator, and deploy spatial descriptive analysis and location quotients to characterise the geography of labour market failure. Our findings reveal that industrial land allocation, governed by top-down central planning without rigorous demand-side assessment or ex-post monitoring, has failed to generate commensurate employment or fiscal returns — constituting a structural accountability failure in public investment management of direct relevance to fiscal governance, tax policy, and territorial development scholarship. We formulate four evidence-based policy recommendations centred on mandatory ex-ante investment appraisal, performance-linked monitoring, fiscal revenue decentralisation, and open public data provision.

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