Arab states have at least 15 million jobless people and the number could surge to 50 million within 10 years without serious measures to stimulate their stagnant econ-omies and create sufficient jobs, according to the Arab League.

All Arab League countries are suffering from such a problem but joblessness has remained under control in some members, including the UAE, on the grounds their development spending is still high and their economy has been growing fast enough in some years.

In its 2003 economic report, the Arab League said the festering unemployment problem in the region is a result of lower development spending in most members, a rapid population growth, a surge in the workforce, and flawed economic and fiscal policies.

While unemployment in some member states is as high as 20 per cent, it has remained as low as 1.8 per cent over the past seven years in the UAE and Kuwait. Unemployment among UAE nationals is higher, standing at around six per cent, given the relatively low numbers of local manpower, according to official figures.

But the reasons for unemployment among nationals in the UAE have nothing to do with economic performance but with completely different factors. They include a sharp increase in native graduates, their preference for working in the public sector and the reluctance of the private sector to recruit nationals on the grounds they are costlier.

Figures revealed by Matar Humaid Al Tayer, Minister of Labour and Social Affairs, showed around 13,000 known nationals are looking for jobs, accounting for nearly six per cent of the total native workforce of around 200,000 at the end of last year.

"More than 3,000 nationals are graduating from universities and institutes in the UAE every year and the rate is expected to continue until 2015…this requires serious measures to accommodate all those graduates in the labour market," the Minister told the monthly bulletin of the Abu Dhabi Chamber of Commerce and Industry.

"We call on all nationals to double their efforts to grab available job opportunities and on the private sector to support them by providing training and employment because nationals are our real investment given the presence of a heavy, unstable foreign labour."

The Arab League report, distributed by the Abu Dhabi-based Arab Monetary Fund, warned that a deterioration in unemployment could lead to social turbulence in some Arab countries and called on them to push ahead with reform programmes.

"Arab countries are facing a serious challenge as they entered the new millennium burdened with severe economic and social problems, including unemployment and poverty… they have no choice but to intensify their efforts to support economic development and ensure jobs for their fast growing citizens," it said.

"Our forecasts are that the Arab work force will grow by an average three per cent between 2000-2015 while jobs will grow by only 2.5 per cent…at this rate, we expect the number of unemployed people to sharply increase to between 35-50 million."

It said most Arab nations are still suffering from slow growth, slackening productivity, poor investment, defective economic and fiscal policies in some members and rapid growth in the population, exceeding three per cent in most regional countries.

"Developments over the past years have shown that the fiscal policies in Arab countries lack flexibility because they are heavily reliant on limited sources of income, including oil…such a reliance has made them high susceptible to any shocks to those sources…such developments have created persistent deficits in their budgets and because of their limited alternatives, most Arab countries have resorted to cutting spending… but the cuts were mostly in development expenditure," said the report.

In another report, the United Nations Economic and Social Commission for Western Asia (ESCWA), which groups most regional states, also blamed poor economic performance, high population growth and inadequate planning. But it cited other factors in the Gulf, including preference of the public sector.

"In the Gulf, there is a problem of reluctance by citizens to take up technical and productive jobs and their preference of administrative, office and supervisory jobs...their preference of the public sector over the private sector is also aggravating the redundancy problem and widening the gap in real production."

At a labour conference in Abu Dhabi last year, the UAE urged Arabs to take serious measures to tackle the joblessness problem and warned their failure to do so could give rise to social and political unrest.

Jobless rate
(In selective Arab states)
1995-2001
Kuwait 1.0
UAE 1.8
Qatar 2.3
Bahrain 3.1
Syria 6.5
Egypt 7.4
Lebanon 8.4
Libya 11.7
Jordan 13.7
Sudan 17.0
Oman 17.2
Algeria 28.7
Source: Arab economic report