Egypt Not Alone in Having Demographics of Doom

♠ Posted by Emmanuel in ,, at 2/14/2011 12:02:00 AM
Back in elementary school, I remember learning how to interpret charts. For today's feature, I'll extend this fond reminisce and explain with a few handy images why Egypt is not alone in having demographic woes in the Middle East and North Africa. Woes that, in certain circumstances as Tunisia and Egypt demonstrate, can result in regime-toppling popular unrest. Many self-absorbed Westerners, particularly those of the neoconservative persuasion, will naturally ascribe these events to downtrodden people yearning for freedom and democracy (nevermind that their leaders helped propped up these tyrants for decades like Mubarak). My explanation is simpler: growing populations of unemployed young people are a hazard to authoritarian regimes. Furthermore, recent events suggest states unable to buy them off with proceeds from energy revenues are particularly vulnerable.

First, while it is true that youth unemployment rates are quite high around the world, such rates are obviously more pernicious in countries with large proportions of young people. Consider the population pyramid of Egypt based on International Data Base figures:

The Egyptian population is very young, indeed, with a median age estimated at 24. Next, have a look at the youth unemployment figures from slide 19 of a recent IMF regional presentation on what it calls "Middle East North Africa Oil Importers" (link c/o Real Time Economics):

Aside from being oil importers, what Egypt and Tunisia share are the highest levels of youth unemployment in this group of countries, being well above the Middle East / North Africa average on the right hand side of the chart above. Coincidence? I'll leave that up to the area studies folks to sort out.

Let's now move to the regional situation. Fortuitously, the International Labour Organization (ILO) recently released the most recent biennial Global Employment Trends for Youth report for 2010. Especially given the backdrop of the global financial crisis, conditions are quite difficult for young folks seeking world not only in these regions but around the world. First, the good folks at the ILO have prepared a youth employment-to-population ratio chart for various world regions from 1991 to 2011. At the foot of the table are North Africa (which Egypt and Tunisia are classified under) and the Middle East with well under 30% of the young being at work:

As a proudly gender-aware blogger, I must point out that exceedingly low employment of young working women contributes quite a lot to the poor showing of the Middle East and North African groupings. From p. 15 of the ILO report:
The portrait of youth employment in the latter two regions is quite similar; while four out of ten male youth were working in 2008 (39.5 and 40.7 per cent in the Middle East and North Africa, respectively), less than two of ten young women engaged in work (14.9 and 15.9 per cent, respectively). There is clear segmentation in youth labour market opportunities in these regions with the result being severe underdevelopment in the productive potential of the economies. Employment opportunities are clearly low for young men in the region and nearly non-existent for young women.
Finally, I will give no prizes for those who've correctly guessed which regions of the world have the highest youth unemployment rates:

Someone with little experience at reading charts (hopefully not you) may complain: "Well, even if the Middle East and North Africa top the youth unemployment tables, rates have been going down even there in recent years. So, some countries should have revolted years ago instead of now." As above, you need to consider (1) the relative share of youth to the overall population in the respective countries and (2) the outright size of the young population. Moreover, unique to the world's regions, the Middle East and North Africa are expected to have rises in this rate in 2010 and 2011.

If you look at the overall macroeconomic picture of Egypt, it isn't too shabby. It has a high growth rate and its foreign debt is decreasing as a percentage of GDP. However, the demographics tell another tale. While I can't say that I could've predicted these events, they make more sense in retrospect given the information present above in chart form. Watch the kids, I tell you, watch the kids.