Merryn's Blog

Egypt's youth unemployment problem has erupted – but what about Britain's?

As Egypt is finding out, having a lot of unemployed young people is a recipe for trouble. The bad news is that Britain's youth unemployment now stands at over 20%. And while they're unlikely to be toppling the government any time soon, David Cameron ought to be worried.

Conventional wisdom has it that the younger a population the better. Having a large, young population suggests that a country will have a flexible and competitive workforce (as China has today and India will have for some time to come). That's good for productivity.

At the same time, if the young don't have to support too many unproductive members of society (inside their own households or via their taxes) they save and invest more than they could otherwise. That's good for their economies and for their stock markets too. It is also why people tend to worry about China's future (China is ageing fast) and about that of so many western countries with their low birth rates.

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But having a lot of young people isn't necessarily a plus. Sure, it's a good thing when they are either working or expecting to work soon inside a relatively democratic society that they feel gives them a voice.

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But what about when none of those things are true? What happens when they don't have a job; when thanks to corruption, grotesque inequality and overall lack of economic freedom, they aren't likely to get one; and when there is absolutely nothing they can do about it? Then it isn't usually so good.

In Qatar and Saudi Arabia, 25% of 15-to-24-year-olds are unemployed. It is the same in Algeria and in Tunisia where unemployed youths spearheaded the protests. And it is the same in Egypt. Egypt is the Arab world's most heavily populated country and one of its youngest: two thirds of the population are under 30. However, the young make up 90% of the nation's unemployed (the official rate is 9.4%, but the real number among the young is much much higher).

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It is worth noting along the way that there is an intimate connection between the number of young men in a society and the odds of it going to war. As York University (Toronto) academic Christian G Mesquida puts it, "the most reliable factor in explaining episodes of coalitional aggression is the relative abundance of young males. The ratio of the number of men ages 15 to 29 years of age versus men 30 and older in a population appears to be associated with the occurrence and severity of conflicts as measured by the number of war casualties. A series of analyses of demographic and war casualty data indicates that the relative prevalence of young men consistently accounts for more than one third of the variance in severity of conflicts."

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So having a young population, and in particular a young male population, without the infrastructure to give them a good life or at the very least the hope of a good life isn't necessarily a recipe for stability or productivity. Chuck in a downturn in the global economy and a spike in inflation, and the next thing you know, you've got tanks in the capital, the banks and the stock market are closed and anyone with a private jet is already on their way to Dubai.

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But unemployment doesn't just spark trouble in the emerging world. Look to the UK. Here we know that "young adulthood" is a vulnerable time. And we know that when they are out of work, unemployed young people are more likely to commit crimes than when they are not. And we know that we can trace much of our own past episodes of unrest to high rates of youth unemployment the 1981 inner city riots for example. It also drives the young into gangs (if you can't belong in a work place you still need a group of people to join with every day) and sparks extremism.

We don't have a gender-imbalanced population thank goodness but, like the US, we have a younger one than most other developed countries. The problem? Our young aren't working enough. Youth unemployment in the UK (those under 25) has now hit 20.3%. That is the highest since records on this began in 1992. It is also not much below the rates in the likes of Tunisia, and means that there are now a million-odd irritated young people knocking around looking for something to do.

Our young are unlikely to goad David Cameron into calling tanks into Parliament Square any time soon but that doesn't mean he shouldn't be worried. He should be. And as I said in last week's editor's letter, it should be just one more thing prompting him to get on with cutting the red tape around employment as he has promised he will to work more to improve apprenticeships and to stick to his guns with creating the conditions to provide the growth that might improve matters.




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