- The Washington Times - Wednesday, February 22, 2006

This is a column with a lot of forbidding statistics. They will explain a good deal about the unending Middle East-North Africa (MENA) economic, and therefore, politicosocial crisis. The column is based on a reliable study of worldwide unemployment by the International Labor Organization, a specialized U.N. agency.

The study’s most important finding is that the highest rate of unemployment in the world is in MENA, at 13.2 percent. In only Arab states, unemployment jumps to 20 percent. Paradoxically, sub-Sahara Africa, the world’s poorest region, is second with 9.7 percent. Most puzzling in the study, prepared by Nimrod Raphael for MEMRI, is that the Arab oil-producing countries employ between 7 million and 8 million expatriate workers who send home as much as $22 billion yearly.

Even worse, young people, 15-to-24, comprise almost half of the world’s unemployed, though youth make up just one-quarter of the working age population. (The unemployed worldwide is 191.8 million as of 2005, a rise of 34.4 million since 1995.)

Ahmad Gowaili, secretary general of the Arab League Economic Unity Council, is authority for the finding that the unemployment total for the Arab countries is 20 percent, or 22 million people. Even in the depth of the Great Depression, the U.S. unemployment rate never exceeded 17 percent.

One evil effect is this jobless rate is eventual underemployment when skilled workers are compelled to take low-paying jobs far below their qualifications.

Another measurement used by the ILO is the employment-to-population ratio, the percentage of working-age population who are employed. Even in that statistic MENA is low, 46.4. Contrast that figure with a ratio of 62 worldwide or a ratio of 57.0 in heavily populated South Asia.

Another startling datum is that MENA is the sole region where productivity does not move in tandem with GDP (gross domestic product). GDP growth has been fueled by sharp increases in oil income, which is good except that this growth has been accompanied by what the ILO calls “stagnant productivity.” In contrast, East Asia has benefited from what is called “the virtuous cycle,” resulting from a combination of productivity growth, job creation, and a jump in GDP.

“Stagnant productivity” in MENA simply can’t lift family earnings above the meager $2 a day. What then? A warning:

World Economic Forum President Klaus Schwab sees MENA unemployment as “a time bomb.” Defusing it would require 100 million new jobs in the next decade.

“Unemployment is a grave source of hopelessness,” writes Mr. Raphael, “and hopelessness drives people to extremes. This was clearly demonstrated in the 20th century in the rise of Nazism and fascism. Unemployment has the great potential of being a source of political instability, and even violence. And it is to no one’s advantage to treat this economic dislocation with equanimity.”

One minor dissent: Mass unemployment is to the advantage of al Qaeda, Hamas, Osama bin Laden and to those Arab “rent-a-crowd” Muslim leaders who don’t like cartoons. For them mass unemployment is a heaven-sent gift.

Arnold Beichman, a research fellow at the Hoover Institution, is a columnist for The Washington Times.

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