Only half of the 51 million Egyptians between the ages of 15 and 64 are counted in the government’s measure of the labor force, which is why the official unemployment rate stands at only 11%. America’s labor force of 153 million, by contrast, comprises three-quarters of the population aged 15 to 64. If Egypt’s labor force were counted in the same way as America’s, the unemployment rate would be 40%. The effective unemployment rate is even higher, for three-fifths of Egyptians live on the land, while the country imports half its caloric consumption.
Agriculture productivity in Egypt is so poor that most farm labor must be considered disguised unemployment. 30% of Egyptians of the relevant age, moreover, attend university, while only half graduate, and of those, few find employment. Perhaps an additional 3 million Egyptian unemployed are warehoused in the university system.
More than half of Egypt’s population has nothing to do, and lives on one form or another of public subsidy. The world economy does not want them. With a 45% rate of effective illiteracy, Egyptians are unfit for modern factory work, and the products of the university system mostly are unqualified for engineering or administrative jobs. As Egypt’s state finances disintegrate under conditions of unrest, the position of the redundant half of the country’s people is becoming desperate. It is hard to see how a catastrophe can be avoided now that Egypt’s tourism industry has dried up.
Cairo, Egypt – the site of President Barack Obama’s effusive address to the Muslim world in June 2009 – is becoming the world’s epicenter of despair. Five years earlier, as a candidate for Illinois State Senate , Obama also spoke in Cairo, Illinois, at the southern tip of the state where the Ohio and Mississippi Rivers converge. It merited a mention in his campaign book The Audacity of Hope: “We discussed what might be done to restart the area’s economy and get more money into the schools; we heard about sons and daughters on their way to Iraq and the need to tear down an old hospital that had become a blight on downtown.”
A third of Cairo’s population lives below the poverty line and its unemployment rate is 12%. Three-fifths of its people are African-American. Obama singled it out as a subject for hope and change. There is a component of the American population whose marginalization compares to Egypt, and that is African-Americans aged 16 to 19 years. Their official unemployment rate is 46.5%, although the effective rate is much higher, for only 13% of blacks in that age bracket actually have jobs. Only a quarter of black high school seniors will graduate college.
Cairo, Egypt and Cairo, Illinois have another thing in common: their economic misery is the outcome of political models that warehouse the poor rather than prepare them for productivity. Like most Third World dictators, the rulers of Egypt from Nasser to Mubarak kept most of their people poor, illiterate, and down on the farm, while employing the putative higher education system as a political pressure valve. Starting with the Johnson administration, America’s incipient welfare state made the poor, and especially the African-American poor, dependent on a political regime that encouraged economic dependency.
That is why the people of Cairo, Egypt and Cairo, Illinois are starving in the midst of plenty. There are plenty of jobs for people who can read the new edition of the manual. Just 4% of Americans with a four-year college degree or better are unemployed, a remarkable fact given the mediocre quality of American university graduates. Evidently, basic reading comprehension, basic math and the ability to produce work on time are sufficient qualifications for a job in corporate America.
The world economy, meanwhile, can’t get enough qualified labor, while it ignores the untrained, semi-literate victims of state dependency. A 2011 survey by the Manpower Group, the world’s largest human resources firm, reports:
Despite the slow and uneven recovery from the global economic downturn and lingering high levels of unemployment in many markets, organizations around the world still report that they cannot find the talent they need when they need it. They are looking for evermore specific skill sets and taking longer to fill job vacancies as they wait for the economy to fully rebound and their businesses to get back to ”normal.” But global economic forces have strained existing models and systems to such a point of tension that they are no longer sustainable. There will be no return to the pre-recession ”business as usual.”
The Manpower Group survey adds:
ManpowerGroup research reveals employers in India, the United States, China and Germany report the most dramatic talent shortage surges compared to last year. In India, the percentage of employers indicating difficulty filling positions jumped 51 percentage points. Nearly one in four employers say environmental/market factors play a major role in the talent shortage – employers simply aren’t finding anyone available in their markets. Another 22% of employers say their applicants lack the technical competencies or ”hard” skills needed for the job.
The unemployment catastrophe in the two Cairos evidently has little to do with demand for labor as such. The world economy has changed and left the semi-literate and barely-educated behind, perhaps permanently. A rising tide does not lift all boats. It swamps the ones that are anchored to the sea floor. We need to reach back to the 18th and 19th centuries to find a comparison. As I wrote in a 2006 essay, What do you do with all the farmers?, Asia Times Online, September 26, 2006:
Every great advance in productivity of agricultural in history left in the lurch a superfluous population that was ground up in war. The Carolingian Renaissance of the High Middle Ages brought the horse collar, the steel plow, windmills for swap drainage, and three-field rotation. The Teutonic Knights shifted some of the excess population to the Baltic and Eastern Europe, eradicating the local population in the process. The Crusades absorbed more of the surplus, until the Black Death of the 14th century made people scarce again. The Napoleonic Wars dealt with the peasants made redundant by the agricultural revolution of the 18th century, and World War I repeated the exercise a century later.
Emerging Asia has raised the bar for all the economies of the world, as dramatically as the Industrial Revolution did two centuries ago.
The Industrial Revolution improved the lives of British workers by every available measurement – life expectancy, consumption, and so forth. But that was true only for those who survived the agricultural revolution to become industrial workers. The agricultural revolution that prepared the industrial revolution displaced a large proportion of agricultural labor. Starvation, emigration and war consumed the redundant population.
The Napoleonic Wars alone killed 188,000 British men, in a population of less than 9 million, the equivalent of 6.3 million in today’s American population. An additional 225,000 were transported as criminals to America (60,000) and Australia (165,000), not counting perhaps 1 million voluntary emigrants during the 19th century from England, Wales and Scotland.
Altogether, the attrition rate of the English and Welsh population at the turn of the 18th century amounted to 15%. Scotland must be considered separately, because the English deliberately cleared the Highlands of people after the 1746 Stuart rebellion. About half a million Highlanders were displaced, almost a third of the Scots population. Whole villages were transported to North America.
While conditions of life improved for British workers, machine-spun cotton destroyed more than a quarter of India’s cotton manufacturing industry, and by 1860 had displaced more than half a million workers, leading to starvation in Bengal, the historic center of India’s cotton weaving.
The last time a vast improvement in industrial productivity upended the lives of millions of people around the world, a large proportion of the affected populations did not survive, at least not in their own homes, and many not at all.
In Cairo, Illinois, the lives of the unemployment are not at risk, because America’s social safety net will remain in place. But the lives of the Arab poor in Cairo, Egypt and similar cities are in urgent peril, and the scale of the problem is so great that it is hard to envision a solution. It should surprise no-one that Middle Eastern politics have taken on a new, apocalyptic tone.
Spengler is channeled by David P. Goldman. He is the author of two new books, How Civilizations Die (and Why Islam is Dying, Too), published by Regnery and a collection of essays, It’s Not the End of the World – It’s Just the End of You (Van Praag).