Top 5 Potential Political Hot Spots Based on Surging Unemployment Rates & Civil Unrest

Unemployment rates have skyrocketed as many people around the world have suffered unemployment in recent years. Economic crises in the United States, Greece, South Africa and Spain have seen jobless rates soar.

Anti-austerity movement in Greece, Photo Credit: The GuardianWhile there are countries that have seen their economies recover in recent years; the numbers don’t always tell the full story. For example, in the U.S., the unemployment rate in March 2016 was 5 percent, when it had been hovering around 10 percent in late 2009. Meanwhile, candidates in the presidential race on both sides of the aisle are still talking about people struggling because they are making less money than they used to. Others are working part-time; and many have outdated skills that don’t fit the modern job market.

An Era of Protests

Long-term unemployment, or under-employment, is taking its toll on people, and it’s leading to civil unrest in parts of the world. South Africa has long been among the countries with the highest unemployment rate, and has seen its share of protests as a result. Earlier this year, the North-West University in the city of Mafikeng was evacuated after student protests led to torched buildings. Among the reasons for the protests were unemployment, low wages and high fees. It is the latest in a series of protests at universities in South Africa, which began with protests at Tshwane University of Technology after students weren’t allowed to register for classes because of their tuition debt.

South Africa Student ProtestsAmong the most famous protests in recent years were the ones that occurred in Greece in 2010 and 2011. The demonstrations began when Greece’s debt crisis led to plans to cut spending and raise taxes. May of 2010 saw a major demonstration that led to three people being killed. A year later, protests led to violence in Athens and other cities. The next month saw violence between riot police and activists after Greece’s parliament approved austerity measures.

Spain also has had its share of “anti-austerity” protests, beginning in 2010. Some of these protests have drawn hundreds of thousands of people. These protests have led to so-called “gag laws,” which limit where and when protests can take place. Those laws resulted in an outcry, based on the belief that the laws limit free speech. A group of journalists filed a lawsuit against Spain’s laws with the European court of human rights, claiming the law violates the right to assembly and freedom of expression.

Youth Unemployment

Youth Unemployment is generally defined as unemployment among people ages 14 to 28, based on the United Nations’ definition of young people. This number tends to be higher than the overall unemployment figure. For example, in the U.S., it’s around 10 percent compared to the 5 percent overall number.

High Youth Unemployment Rates in SpainThe highest youth unemployment rates in the world, according to World Economic Forum, include:

  1. Spain (53.2 percent)
  2. Greece (52.4 percent)
  3. South Africa (51.3 percent)
  4. Italy (42.7 percent)
  5. Portugal (34.8 percent)

The high youth unemployment rates have led to protests around the world in recent years:

  • Unemployment in Tunisia has resulted in protests throughout the country, with frustration over the lack of work leading to suicide attempts. In January 2016, it was reported that a policeman was killed in the town Feriana when demonstrators turned over his car. There also were protests in the Kasserine province after a man was electrocuted when he attempted to climb a transmission tower in protest of not getting a government job. 
  • In the U.S., the 2014 riots in Ferguson, Missouri, were directly tied to the shooting of Michael Brown, a black, unarmed teenager, by a white police officer, but several media reports quoted protesters as citing a lack of jobs and opportunity as a major factor in the unrest.
  • Spain "Gag" Law ProtestsIn May of 2014, an “anti-austerity” protest in Madrid, Spain, turned violent with young people throwing things at police. The protesters wanted the government to focus less on paying debt, and focus on unemployment, health care, and education.
  • The Arab world saw major protests in Egypt, in 2012-13, protesting measure by then-President Morsi after his government extended his powers. The protests were organized by various opposition organizations, and led to the end of Morsi’s presidency in July. 
  • Stop Genocide in Libya Protests Protests in Libya in January of 2011 began with rancor over delays of the construction of housing units, and political corruption. While the government eventually established fun for housing and development, but protests continued, leading to a civil war and the overthrow of Muammar Gaddafi and continued civil unrest, with Fayez Mustafa al-Sarraj being the current Prime Minister.

Protesting in the Digital Age

Technology has been a major factor in the modern protest scene. Communication has made it easier for people to coordinate and arrange protests. This has led to the term “Twitter Revolution,” referring to protests in Iran, Tunisia and, most significantly, the Egyptian Revolution of 2011, which ended the 30-year regime of Hosni Mubarak.

Another tech protest came last year with a “hologram protest” where thousands of people projected holographic forms of themselves in front of a Spanish parliament building to protest the gag laws. Protesters were able to go to a website and allow a webcam to film their face so that they could become part of the protest.

Countries with the Highest Unemployment Rates

According to the World Labour Organization, with economic recovery around the world stalling, and high unemployment remaining an issue in many countries, the potential for social unrest continues. Here are the top 5 countries with the highest potential for continued civil unrest as a result of surging unemployment:

  • Iraq: Iraq’s unemployment rate has dropped to 16 percent from a high of 28.10 percent in 2003. But that’s still a high number, and the country continues to attempt to recover from the war. There could be hope for Iraq’s future though, because the country has a young population that is increasingly technologically savvy.
  • Spain: Spain’s unemployment jumped from around eight percent to 26.94 percent in early 2013. But the country’s rate has been an issue for decades. Its youth unemployment rate is 47 percent. Similar to the U.S., Spain underwent a housing bubble in 2009 from which the economy, and unemployment rate, still haven’t recovered.
  • Greece: Greece’s unemployment rate is nearly 25 percent, with a youth unemployment rate at close to 50 percent. A serious issue in Greece is long-term unemployment, meaning people who are out of work for 12 months or longer. Many experts believe Greece’s government will need to implement detailed, intricate policies in order to improve the country’s unemployment situation.
  • South Africa: This country has had an unemployment rate over 20 percent since 2000. Contributing factors are poor education, ineffective training, low demand for labor, a lack of business growth, crime, and the continuing effects of apartheid.
  • Egypt: Egypt’s unemployment rate fell in 2015 from 13.1, but it remains high at 12.8 percent. The country faces many economic challenges, including increasing inflation, which is negatively affecting purchasing power. Supply and demand is another issue, but the good news is that the International Monetary Fund announced that policy forms could restore balance to Egypt’s economy.

The civil unrest is prominent in Latin American countries such as Brazil and Argentina, where economic growth has slowed, and in Venezuela, where there is frustration with government regulations, and protests over government rationing of food and energy.

Job losses in Africa, as well as increased living costs, could lead to civil unrest in such countries as the Sudan, Kenya, Ethiopia and Nigeria, according to Verisk Maplecroft, a U.K.-based global risk and consulting firm.

Companies that conduct business in countries where there is civil unrest and are political hot spots can protect their staff and insure their assets through Clements’ War and Terrorism Insurance Coverage and Political Violence Extension. The extension provides coverage against the risks of civil unrest, war, and acts of terrorism and can be added to the following policies: Personal Accident insurance, Defense Base Act, WorldAuto Fleet, and Business Property and Liability insurance. 

Keeping your employees safe is our priority. Call us today at +1.202.872.0060 or 800.872.0067 or e-mail request@clements.com to discuss how we can tailor our policy to meet the size and scope of your organization. 

Key Types of Political Violence Businesses Should Monitor