This study, which analyzes the key labor market determinants of migration flows from selected Arab Mediterranean Countries (Algeria, Egypt, Jordan, Lebanon, Morocco, Syria, Tunisia and the Occupied Palestinian Territories) finds that employment in AMCs is a major challenge for the region - and for Europe - in the next 10 to 15 years. Immediate action is needed because the status quo risks causing permanent damage to the development prospects of those countries. The AMCs' public policies are currently ill equipped to face the challenge. Labor migration remains a key feature of the labor markets in these countries - yet cannot by itself solve the labor market challenges there. The study makes a number of recommendations including: upgrading the statistics available and conducting further in-depth analysis; upgrading education and training systems; mainstreaming the policy goal of job creation and higher productivity; promoting active labor market policies; creating incentives to hire new graduates and women; creating incentives to transform informal into formal employment; and establishing social protection systems guaranteeing universal coverage, with the emphasis on worker rather than job protection. It also recommends that the EU upgrade its existing framework for AMC migration not only as a unilateral strategy, but as a cooperative framework for true co-development.--Publisher's description.