Unemployment in Egypt and its impact on Social Development since 2010

Abstract

Unemployment is one of the major factors that economists look at to evaluate a country, it is a major problem in many states, it is when an individual is currently looking for a job and unable to find one. It indicates the economy stage of development, economic growth of the country and the efficiency of the labor market. When there is a recession in the economy individual’s experience a high unemployment rate, Unemployment can be calculated by dividing the sum of unemployed by the sum of individuals in labor. States calculate unemployment rates differently; for instance few states do not calculate number of undergraduates seeking jobs, others do not calculate the sum of female individuals looking for jobs. (Layard R., 1991) Unemployment is a negative phenomenon in any human society as it adversely affect in different dimensions and directions. In addition, it refers to an economic defect affecting the community structure. Thus, the economic and social dimensions of unemployment increase complexity, consequently lead us to adopt several analyses to understand its nature and impact on the growth. The effects are verified by the presence of causal relation between rates of economic growth and the changing rates of unemployment prevailing in the economy. (Ochsen C., 2011) Unemployment is a very significant problem facing Egypt. The Egyptian Labor Market is mainly characterized by high rates of unemployment among highly educated job seekers, low rates of return on education, increasing trends of informality in the labor market, the shifting of dominance from of public sector employment to private sector employment, low-levels of labor productivity, and scarcity of skilled workers needed to match and satisfy the needs of a more competitive and globalized economy. Unemployment and job creation are among the most important challenges facing policymakers in Egypt today. Not surprisingly, the government has made these challenges the cornerstone of its reform effort. The emphasis follows the recognition that unemployment is a waste of society’s human capital. It has direct adverse effects, especially on those with no physical assets. Furthermore, a high concentration of unemployment among the educated youth could be destabilizing. (Khalifa, 2004)