This article will talk about the 25 countries with the highest rates of unemployment. We will also analyze how recent events have accelerated existing trends surrounding unemployment in the world. If you want to skip our detailed analysis, you can head straight to the list of 10 Countries with the Highest Rates of unemployment.
Research shows that the unemployment rate in the US went from 3.8% in February 2020 to 13% in May 2020 when the pandemic hit the globe, particularly in the shape of a lockdown. There was an estimated increase of more than 14 million unemployed workers in the US from February to May due to the economic shutdown. With a loss of more than 20 million jobs between March-April, the unemployment rate in April hit the highest level since the Great Depression of the 1930s, when the unemployment rate reached 25% in the US.
As per the Bureau of Labor Statistics (BLS), the leisure and hospitality industries were impacted the most among all the industries. Temporary shutdowns of eateries, cafes, clubs, and traveling led to about 3.4 million job losses in the US, including chefs, dishwashers, travel agents, and hotel and resort staff, which resulted in decreased revenue and tourism.
Moreover, education, services, and government sectors encountered the second and third largest losses in employment and economy. These sectors have had a loss of more than a million jobs ever since the pandemic outbreak hit hard. Nearly 600,000 jobs were eradicated from the manufacturing sector as the problems of the supply chain were on the rise.
With the availability of vaccines and government initiatives, the US recovered from the economic downturn faster than predicted, with unemployment decreasing every month. As of June 2023, the unemployment rate in the US stands at 3.6%, whereas the world’s unemployment rate in 2022 was 5.8%, which indicates a strong job market and healthy economy.
However, it is true that several countries worldwide have yet to recover from the losses incurred during the Pandemic and still have as bad economic conditions as they had before Covid-19. Currently, the country with the highest unemployment rate is South Africa, with an unemployment rate of 29.8%. In contrast, the country with the lowest unemployment rate is Qatar, with an unemployment rate of 0.1%. Additionally, the country with the highest unemployment rate in Europe is Spain, as of 2023, with an unemployment rate of 13.26%.
Even though the use of artificial intelligence has proved to increase productivity and economic growth, the advancement of AI like ChatGPT is altering the employment landscape globally. A study by OpenAI claims that nearly 80% of US employees are prone to have their 10% of work tasks altered because of learning models introduced in GPT tech, whereas nearly 19% of employees may find 50% of their work tasks being altered. You can also check our article on 16 Jobs That Will Disappear in the Future Due to AI.
While improvements have been made in the US economy, a group that has been disproportionally affected by unemployment in the US is Black Americans. While the unemployment rate stands at 3.6% for the locals in the US, the unemployment rate for black Americans stands at 6%. After a promising increase in the employment rate of Blacks in March, the trend has since reversed, with a third consecutive decrease in employment rates resulting in a loss of 635,000 jobs for Black Americans. This downturn in jobs has resulted in a decline in the participation rate by 1.5% since March eradicating 239,000 individuals from the labor force.
Among all the challenges associated with an upsurge in unemployment, remote job opportunities have served as a beacon of hope during the covid-19 and post-pandemic periods. According to research, countries such as France, Germany, the United Kingdom, and the United States could have experienced worse employment losses if remote work had not been available. Once the GDP of each of these countries was calculated, it was estimated that the GDP would have decreased twice as much during the Pandemic, had remote jobs not been available.
The annual income of remote workers is $4,000 higher than those with on-site jobs, as JobFlex and Global WorkPlace analytics reported. Moreover, a survey by FlexJobs found that 65% of employees feel more productive in a home setting than in an office setting because of fewer distractions, flexibility, and no commute.
The Helping Hands of the Big Giants
To overcome the issues of unemployment, many companies have initiated programs aiming to stimulate economic growth on a global scale. It is worth noting that companies like Amazon.com Inc (NASDAQ:AMZN) and Alphabet Inc (NASDAQ:GOOG) have been at the forefront of addressing unemployment issues.
To help professionals get back to work, Amazon.com Inc (NASDAQ:AMZN) announced its Returnship Program in July 2021. Through paid rigorous training for 16 weeks, this initiative mainly aimed to boost and help professionals acquire skills that can help them return to the workforce after a break. At the end of the program, dedicated participants may also avail of a full-time position at Amazon.com Inc (NASDAQ:AMZN).
Alphabet Inc (NASDAQ:GOOG) is another game-changer actively addressing the issue. One of the notable initiatives taken by Alphabet Inc (NASDAQ:GOOG) is providing Google Career Certificates. First launched in 2018, Alphabet Inc (NASDAQ:GOOG) has provided online job training to help people enter high-demand fields through professional certifications like IT, Data Analytics, Project Management, and UX Design. They are designed to be suited for individuals looking for flexible and remote learning arrangements. Additionally, Alphabet Inc (NASDAQ:GOOG)’s partnership with Coursera Inc (NYSE:COUR) not only makes these certifications accessible to people around the globe but also accompanies mentorship and career services.
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Methodology
To list the 25 countries with the highest rates of unemployment, we utilized the unemployment rates provided by the World Bank, ensuring that the list is based on reliable and objective statistics. We have also made our list more descriptive by discussing respective GDPs for many countries. The unemployment rates were acquired from World Bank data for the most recent year, i.e., 2022, for all 25 countries.
25. French Polynesia
Unemployment Rate: 13.1%
French Polynesia has a GDP of $6.08 billion with an average life expectancy of 79 years. The country’s main contributors to its GDP are the sectors of tourism and agriculture. One main reason for the country’s high unemployment rate is its small population which translates into fewer job opportunities.
24. Cabo Verde
Unemployment Rate: 13.6%
The country has a service-based economy with reliance upon commerce, transport, and public services making up 60% of its GDP, which is $2.31 billion. Due to restricted natural resources and a small population, the country has a high unemployment rate.
23. Republic of Yemen
Unemployment Rate: 13.6%
Yemen suffers from severe humanitarian crises and food insecurity due to heavy flooding. Even though the country’s economy mainly relies upon agricultural and fishing activities, the heavy rainfall has caused the infrastructure to go downhill, deteriorating people’s livelihoods. According to the World Bank, nearly 18 million Yemenis currently need water and sanitation.
22. Bosnia and Herzegovina
Unemployment Rate: 14.1%
Divided into two, the Federation of Bosnia and Herzegovina and the Republika Srpska, the country’s transitional economy constitutes exports of metals, furniture, energy, textiles, and foreign assistance. The nation’s GDP deteriorated by 3.2% in 2020, provoking persistent unemployment and experiencing a severe recession in 25 years.
21. Haiti
Unemployment Rate: 14.8%
Sharing the island of Hispaniola with the Dominican Republic, Haiti is located in the Caribbean Sea. Despite having a GDP of nearly $20.25 billion with an agricultural economy, it is ranked as one of the poorest countries in the World as it is prone to unfavorable calamities, widespread violence, low education quality, and corruption.
20. North Macedonia
Unemployment Rate: 15.1%
The country had a GDP of $13.56 billion in 2022. The economy of North Macedonia favors the idea of a free economy. Although some private sectors have flourished with the country’s willingness to trade and invest globally, the widespread corruption in the country stands as an ongoing issue causing a hindrance towards economic growth. It is one of the countries with the highest rates of unemployment.
19. Sao Tome and Principe
Unemployment Rate: 15.3%
Sao Tome and Principe (STP) is a lower-middle-income country with fertile soil that depends on the plantation of Cacao. A report by UNICEF 2018 says that only 14.9% of the STF GDP consists of domestic products, as most of the nation’s workers belong to the farming industry.
18. Montenegro
Unemployment Rate: 15.4%
In 2022, Montenegro had a GDP of $6.095 billion. The country’s fragile economy is transitioning towards a market-oriented economy, focusing mainly on tourism and the energy sector. Although the Covid-19 Pandemic posed unprecedented disruptions, the country’s economy made a remarkable recovery in 2021, with an excellent growth of 13%.
17. Iraq
Unemployment Rate: 15.5%
Officially known as the Republic of Iraq, it is located in West Asia, with a GDP of about $264.18 billion as of 2022. According to World Bank, being heavily reliant on the oil industry, the revenues generated make up 99% of the country’s exports, 85% of government budgets, and nearly 42% of GDP. However, unemployment remains a major concern for women, refugees, and the informal sector, making it one of the countries with the highest unemployment rates.
16. Tunisia
Unemployment Rate: 16.1%
Tunisia’s GDP stands at $46.66 billion as of 2022 and an inflation rate of 10.4% as of February 2023. With little to no access to external financial support, the country struggles to support economic growth.
15. St. Lucia
Unemployment Rate: 17.4%
In 2022, St. Lucia had a GDP of $2.065 billion. The main sectors thriving in the country are tourism and real estate. Since the tourism industry makes up 65% of the country’s GDP, St. Lucia has become the ultimate favorite place for foreign investors. However, the Covid-19 Pandemic resulted in a huge setback in the tourism industry, leading to job losses and a fallout in economic growth.
14. Jordan
Unemployment Rate: 17.9%
Having a small economy, long-standing slow economic growth, and high commodity prices, Jordan continues to suffer a high inflation rate and unemployment rate. According to the World Bank, Jordan is one of the most water-scarce countries globally. Jordan is also one of the least developed countries in Asia.
13. Lesotho
Unemployment Rate: 18%
As a lower-middle-class neighboring country to South Africa, Lesotho’s economy mainly depends on foreign currency, foreign assistance, and the inflow of worker remittances. The country had a population of nearly 2.6 million and a GDP of $2.55 billion in 2022. It is one of the countries with the highest rates of unemployment.
12. Sudan
Unemployment Rate: 18.7%
The economy of Sudan tends to be extremely traditional, relying on agricultural activities, with a GDP worth $51.66 billion in the year 2022. Due to a lack of natural resources and political instability, unemployment in Sudan remains high. Sudan is also one of the least developed countries in Africa.
11. St. Vincent and Grenadines
Unemployment Rate: 19%
Known as the poorest country in the eastern Caribbean, the country’s economy heavily contributes to the agricultural sector, with the main production of bananas accounting for 60% of the workforce. As per World Bank, the annual growth of GDP in the country was 5% in 2022.
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Disclosure: None. 25 Countries with the Highest Rates of Unemployment is originally published on Insider Monkey.