Nearly 24 million young Arabs could be unemployed, with an additional 75 million "in dire need of an economic future", according to a report by experts from the World Economic Forum (WEF).
The report "Addressing the 100 million Youth Challenge" was published yesterday at the WEF's meeting on the Middle East, North Africa and Eurasia in Istanbul, Turkey.
It is one of the gloomiest assessments so far of the prospects for employment in the region since the Arab Spring upheavals last year, which were largely sparked by poor economic prospects among young people
"With youth unemployment in the region higher than anywhere else in the world, there is a massive political and economic imperative to get Arab youths into work," said Miroslav Dusek, WEF's Middle East director.
The WEF report echoed that sentiment. "Job creation, a perennial challenge for the region, is compounded by its demographics, whereby 100 million young people between 15 and 29 years old, representing 30 per cent of its total population, are in dire need of an economic future which will support the conditions for human development," it said.
Youth unemployment stands at 24 per cent, said the WEF, double the world average. "Unemployment for many young people in the region has become a state of normalcy, with the average spell of unemployment in Egypt, for example, lasting nearly 34 months," said the WEF report.
The worsening employment situation in the region was blamed on high labour force growth, growing at 2.7 per cent per year in the Middle East, higher than any other part of the world except Africa, and the defects of education systems that failed to equip young people with employment skills.
The report also blames labour market rigidities, with large public-sector employers paying relatively high wages and offering better benefits than the private sector.
Oil exporters in the region will need to create an estimated 18.5 million jobs over the next decade "even though this would leave the ratio of employment to working-age population lower than that currently observed in any other region", the report said.
A second WEF report, "The role of large employers in driving job creation in the Arab World", was produced in collaboration with consultants Booz & Co and the Saudi petrochemicals giant Saudi Basic Industries Company.
"We need to act now. Government regulation-led initiatives alone are insufficient, a new paradigm is needed along with new capabilities," said Joe Saddi, the Booz chairman.
"The public sector needs to engage with the other main stakeholders, namely large employers and educators, to identify the attractive jobs, shape training programmes and attract investments to create employment opportunities."
The problem of unemployment, especially among women and young people, has been one of the main themes of the Istanbul forum.
Fouad Alaeddin, the Middle East managing partner for the international accounting firm PricewaterhouseCoopers, said there was a need to match supply and demand in Middle East workforces. "There is a lot of supply coming, and we need to control it. I'm not talking about the Chinese model, but through a programme of education. It is a huge political and cultural issue," he said.
Lubna Olayan, the chief executive of the Olayan Financing Company in Saudi Arabia, said female unemployment totalled 27 per cent in the kingdom, about four times the level for men. "More than half the graduates in Saudi are women, but it doesn't translate into employment. Most men believe in education for women, but not in employment," she added.
Fatma Sahin, the Turkish minister of family and social policies, said her government had been practicing "positive discrimination" in female employment for the past decade but there was still more to do. "There is the possibility that one billion women in the world will be unemployed in 2020, mainly in India and China," she said.
Muhtar Kent, the chief executive of Coca-Cola, said research had shown that ending discrimination against women in employment would boost global productivity by 40 per cent.