BAHRAIN - Unemployment - A Time Bomb.

In parallel, the Salafi movement of today in Bahrain has emerged from among the largely unemployed youths of Sunni community's lower middle class. From the 1950s and through the 1990s, this segment of Sunni society used to be split into two factions, one allied with the poor Shiites and the other tied to pro-Bin Laden militants. Unemployment in Bahrain was the main factor behind the Shiite revolt during the 1990s. The same factor seems to be the main cause of Islamic militancy in the GCC region.

Unemployment is a time bomb; governments are no longer can find jobs to so many graduates who join the work force every year, while private businesses prefer to employ Asian expatriates who are both cheaper and more productive. From Kuwait to Oman, nationalisation of jobs in the private sector has become a priority. But this has its limitations.

Unemployed and under-employed Bahrainis last month formed their own national committee to seek suitable jobs, compensation, and to call for raising the minimum wage. The committee launched an indirect campaign to have 30 to 50 unemployed Bahrainis elected to its central committee. This was to begin work before end-February. The move was described by organisers as a civil society effort to address the issue, and not aimed at the large community of foreign workers in Bahrain. Committee founding members said they would welcome government blessing, but affirmed that they would go ahead with their plans if it did not come.

"There are a number of committees and societies operating in Bahrain that have not received accreditation or had their credentials revoked by the Ministry of Social Affairs", said Abdul Hadi Al-Khawaja, from the now dissolved Bahrain Centre for Human Rights. "This is an effort by the unemployed themselves to shed light on their problem and to have a committee that would represent them and their case".

Khawaja says the problem of unemployment and underemployment continues to haunt Bahrainis because of the strong hold which some big businessmen and influential political figures have on the economy and the media outlets, which they use to resist the reform plans that the government began in recent years. Abdul Wahhab Hussain, a well-known Bahraini political activist and a committee member, says corruption, mismanagement, and discrimination - which he says is intentional at times - is to blame for the troubles in the labour sector.

There are no official figures about the number of unemployed Bahrainis. A McKenzie report, commissioned by the government last year which drew a lot of criticism following its release, suggested there were between 16,000 to 20,000 unemployed Bahrainis. The report forecast the figures of the unemployed could skyrocket to 80,000 in 2013. Former MP Ali Rabee'ah, expected to be part of the new committee, said the problem of unemployment in Bahrain was an artificial one, because of the large number of foreign workers in Bahrain.

Some 100,000 Bahrainis will enter the job market over the next decade, requiring the economy to provide three times more jobs than in the past 10 years, according to McKinsey's report for the country's Economic Development Board. (Mustafa Nabil, the World Bank's chief economist in the Middle East and North Africa, describes unemployment as probably "the main issue" in the Arab world over the next 20 years, when 90m extra jobs need to be created - more than the population of Egypt, the most populous Arab country. That number is worrying western security agencies as well as ruling elites when militant Islam is on the march and terrorist organisations are ready to exploit the frustration that comes with joblessness).

The McKinsey report - in circulation in Bahrain in recent months - is an unusually blunt appraisal of a society's failure to move with the times. It was ordered by Crown Prince Salman Bin Hamad Al-Khalifa - a force behind efforts to modernise the economy. He wants, says one local, "to inherit a happier society when he eventually assumes power".

Like other GCC states, Bahrain has grown to rely on cheap imported labour and foreign expertise. While Indians, Pakistanis, Filipinos and others have flooded to the region in search of work, governments have tended to look after local Arab populations with public sector jobs - or cradle-to-grave benefits. Yet this model is unsustainable, whether in more populous Saudi Arabia or smaller neighbours such as Bahrain, where a third of the 700,000 population are immigrants. The public sector can no longer absorb new entrants and even with oil prices at around $40/barrel, governments are realising money alone is not enough.

Also untenable are schemes such as "Bahrainisation", under which employers are obliged to replace expatriates with nationals under quota schemes, argues the McKinsey report. Across the GCC, there are enterprising nationals working in the private sector. But without structural change they will remain the exception. At current trends, a third of Bahrainis will be unemployed by 2013, and as many as 70% of the labour force will be in jobs which do not correspond to their education and expectations, McKinsey suggests, adding: "Bahrain has to make a fundamental choice about how to address the problems".