The number of unemployed youth in the Arab world is expected to more than double to 50 million by 2020, from 22 million at the end of 2013.
The Kuwait-based Diplomatic Center of Strategic Studies (DCSS) said in a report that Arab governments would need to inject around US$70 billion per year into their economies to create the much-needed five million jobs annually to match population growth and to push through reforms to education systems and labour markets, said Zawya.
However, projected economic growth in MENA, forecast to be around 3.8% this year, will not be sufficient to reduce high unemployment rates due to difficult political transitions, intensifying regional conflicts and weaker crude oil prices, according to the latest report by the International Labour Organization (ILO).
“Unemployment rates in the region continue to be the highest in the world, with the youth unemployment rate at a staggering 29.5% in 2014 and expected to rise to 29.8% in 2015,” said the World Employment and Social Outlook-Trends 2015 report. It put the unemployment rate in the MENA region at around 11.6%.
It said progress in reducing unemployment, especially among youth, has been hampered by a growing population, the emergence of an informal economy that now employs an estimated two-thirds of the labour force and produces one-third of GDP in non-GCC countries, as well as a skills mismatch.
The ILO report also said that when national poverty lines are considered, poverty incidences reach 25% in Egypt, 18% in Iraq and 15% in Jordan and Tunisia. It said income inequality ranges from around 30% in Egypt and Iraq to more than 40% in Morocco.
“High levels of income inequality are primarily a result of the lack of adequate wage policies and limited social protection,” it said. Only Algeria, Bahrain, Egypt, Kuwait and Saudi Arabia have made unemployment insurance schemes available to job seekers, the report added.