World leaders, including President Ellen Johnson Sirleaf and her Korean counterpart, Park Geun-Hye, among others have expressed fear over the alarming unemployment rate of young people globally at the just-ended World Economic Forum (WEF) in Davos-Klosters, Switzerland. This situation, they said, has the potential to destabilize countries that have high numbers of unemployed youths.
At the opening of the WEF on Wednesday January 22, the two female leaders told the audience that the world must, at this crucial time, be prepared to tackle head-on the issue of youth unemployment. Otherwise, the world risks imminent political instability and economic disruption.
A report from the International Labor Organization (ILO) in 2013, estimated the global youth unemployment rate at 12.6 percent, implying unemployment of 73.8 million young people. In developed economies, youth unemployment increased by 24.9 percent since 2008. Some large economies, like Spain and Greece, registered unemployment rates of over 50 percent.
During the same period last year, youth unemployment rates in developing economies were highest in the Middle East and North Africa, at 28.3 percent and 23.7 percent, respectively. In sub-Saharan Africa it stood at 11.8 percent.
According to global statistics, young people constitute over fifty percent of the world’s population. This high level of unemployment does not bode well for the stability of the globe; especially in developing countries where their young people could become disenchanted at any given time.
President Sirleaf told world leaders at the forum that unless the world finds a solution to youth unemployment, the consequences for society are likely to be civil upheaval, political instability, and economic disruption on a global scale.
The Liberian leader and some of her colleagues made several recommendations that they (world leaders) could consider collectively to tackle the menace of youth unemployment the world over.
President Sirleaf said that one of the solutions to this problem would be for large corporations that have obtained concessions in developing countries to address the unemployment problem through training, social benefits to the communities’ whose resources they are profiting from.
She noted that there must also be urgent responses to the call for links between the activities of large corporations and the economy at large. She acknowledged that there is clear evidence that significant employment is not created by large concessions and corporations, which are largely capital intensive in their operations. Rather, it is the small and medium-sized enterprises which lead to the development of a middle class, the most sustainable driver of employment.
She attributed high rates of youth unemployment to a missing pool of skilled labor, as well as insufficient growth to absorb growing labor forces. Consequently, surplus workers face vulnerabilities as they are pushed into the informal sector where they lack regular income, benefits, job security, and pensions.
The Liberian President also pointed out that structural unemployment affects most vulnerable young people. These youths comprise large numbers of economic migrants—particularly from Asia and Africa—who continue to seek refuge in Europe. They risk their lives in perilous voyages to pursue a livelihood and often face racial tensions in host countries.
She quoted an African Development Bank finding that in most countries in sub-Saharan Africa and in all of North Africa; it is easier for men to get jobs than it is for women. President Sirleaf emphasized that the effects of unemployment on women is similar to those faced by the world’s youth.
Besides being a tipping point for political instability, she observed, that pools of the unemployed tend to migrate to the world’s cities, exacerbating urbanization pressures through a growing concentration of urban labor supply.
Also addressing the session was the first female President of the Republic of Korea, Park Geun-Hye, who urged the world to join her country’s journey towards the development of a creative economy where more youths would be involved across the globe.
She also called upon participants of the 2014 World Economic Forum to work towards an economic engine that takes the world beyond current constraints—especially the youth unemployment problem.