Unemployment is a source of instability in MENA

Friday 29/01/2016

The just-released International Labour Organisation (ILO) report World Employment Social Outlook: Trends 2016 highlights some of the Arab world’s shortcomings in terms of employment, a key source of potential instability in the region.
The report came out as riots in Tunisia served as reminder of the destabilising potential of youth unem­ployment. The ILO figures show that labour participation is low and unemployment forecasts worrisome in Arab countries outside the Gulf Cooperation Council (GCC) region.
“In non-GCC countries, unemployment is expected to remain elevated and increase further to 15.4% in 2016,” the report warned.
In these countries, especially in North Africa, two specific gaps — unmatched elsewhere in the world — further compound the unemployment problem.
One is the gender gap. Women are almost three times more likely to be unemployed than men, despite the fact that more young women than men in the Arab world are graduating from universi­ties these days. The second is the age gap: At 28.4% in 2015, the youth unemployment rate in the MENA region is almost five times higher than the joblessness rate for older adults, according to the ILO report.
In North Africa, youth unemployment is even higher than the Arab average: 30% for both sexes and 45% for young women.
Youth unemployment is often the result of a mismatch between the training provided by educational systems and what the job market needs. Urgent educational reform is more than ever required.
The high rate of joblessness among young people is also a reflec­tion of an over-reliance on public sector employment, notes the report. The civil service in Tunisia, Egypt and many other Arab countries employs many more people than are necessary. The Tunisian government was right in rejecting public service recruit­ment as a solution to the country’s endemic youth unemployment problem. While mindsets among young people have to evolve, governments must play a major role in this crisis period.
Unemployment as a whole is fundamentally the result of the lack of economic growth. The region’s economies are simply not grow­ing fast enough to create value-added jobs for young people. Major economic reform cannot be delayed.
The ILO expects economic growth in most of North Africa to remain “too low and not sufficiently inclusive to make a significant impact on youth unemployment”. Tunisia, for instance, cannot create job opportunities with gross domestic product (GDP) growth estimated at close to zero. Economic growth in Jordan and Lebanon slowed in 2015 to 2.0% and 2.9%, respectively. War and the influx of refugees are diminishing the ability of Iraq, Jordan and Lebanon to create jobs.
Ending wars and conflicts are, among other things, economic necessities. But, if the war ended today, Syria would still require 20 years of 3% GDP growth to reach the 2010’s level of economic output. It took Lebanon’s GDP 20 years to recover from civil war.
With the preponderance of the informal sector, economies of the region are plagued by precarious labour and child employment. The MENA labour force counts more than 9.2 million children, an anomaly that further hinders a viable solution to unemployment.

A clear vision is urgently needed in the Arab world on how to get out of the socio-economic morass and provide hope and opportu­nity to the young who legitimately yearn for a better present and future.