What do you think is the #1 business risk in 2018 according to the World Economic Forum?
- Weapons of mass destruction? It’s #29.
- Natural catastrophes? It’s # 19.
- Cyber attacks? It’s #8. We’re getting closer.
Unemployment or underemployment is the #1 risk for doing business.
Unemployment or Underemployment
I’ve seen this in the U.S. While we have record levels of unemployment, we have an entire generation that is seething with resentment over their perceived unfairness of life, work, money, equity, and access to the better things of life.
And, this is a global phenomenon. Take a look at the WEP graph below. The countries with the darkest circles indicate the level of intensity and the width of the circles indicate the breadth of the problem.
As you can see: Central America, South America, Africa, Korea, India, and most of Europe have unemployment problems at best and at worse systemic crises. This is the reason why ‘unemployment/underemployment’ is the #1 business risk.
There are simply not enough jobs for everyone to meet heightened expectations following an unemployable college degree, unpayable student loans, dashed expectations, and perceived institutional unfairness.
And, add to this the future uncertainty of robots changing the basic nature of 40% of work and jobs. Some futurists foretell that 40% of these jobs may be eliminated. Think self driving cars. Automated baristas. Automated retail shopping. Roboticized medicine.
No wonder, high wage employment is the #1 global concern.
Youth Unemployment and Unrest
The above seems untrue to most haves. However, the reality in most developing and even industrialized economies, unemployment and underemployment is a chronic and unsolved issue for ALL generational segments. Take a look at the dark and wide circles in the above WEF figure for Europe.
Huh. Go figure.
Take a look at the youth unemployment rate in the EU countries shown in the below figure. The real significance of the problem emerges. More than 2/3 of the EU countries have youth unemployment rates over 20% and a few over 40%. This does not consider the youth that are underemployed.
The reality is that in most developing and even industrialized economies unemployment/underemployment is a chronic and unsolved issue. The same is in the US. Even with low unemployment, people are afraid and the youth is resentful over underemployment.
The Top 10 Business Risks
The top 10 global risks of highest concern are also revealing about the importance of jobs, work, and career. The lack of these results in disruptors that create most of the following risks.
|1.||Unemployment or underemployment||36|
|3.||Failure of national governance||28|
|4.||Energy price shock||26|
|5.||Profound social instability||23|
|6.||Failure of financial mechanism or institution||21|
|7.||Failure of critical infrastructure||19|
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