Microkhan by Brendan I. Koerner

Risk and Reward on the Gulf of Aden

August 4th, 2010 · 3 Comments

If you haven’t yet checked out the Financial Times much-discussed breakdown on the economics of Somali piracy, do yourself a favor and allocate a few minutes’ worth of reading time. The piece won my heart by using buccaneer salary estimates to convey some perspective on how the notion of “dangerous work” differs so sharply between nations:

The figures debunk the myth that piracy turns the average Somali teenager into a millionaire overnight. Those at the bottom of the pyramid barely made what is considered a living wage in the western world. Each holder would have spent roughly two-thirds of his time, or 1,150 hours, on board the Victoria during its 72 days at Eyl, earning an hourly wage of $10.43. The head chef and sous-chef would have earned $11.57 and $5.21 an hour, respectively.

Even the higher payout earned by the attackers seems much less appealing when one considers the risks involved: the moment he stepped into a pirate skiff, an attacker accepted a 1-2 per cent chance of being killed, a 0.5-1 per cent chance of being wounded and a 5-6 per cent chance of being captured and jailed abroad. By comparison, the deadliest civilian occupation in the US, that of the king-crab fisherman, has an on-the-job fatality rate of about 400 per 100,000, or 0.4 per cent.

Let me add to the statistical zest by noting that a top-flight king crab fisherman can make upwards of $10,000 per day—though, granted that figure was bandied about before the Russians came along and started diluting the stock.

(h/t Russ Mitchell)

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3 Comments so far ↓

  • Mr. Shrimp

    I’ll get to the Financial Times piece in a second – this is extremely interesting. I guess I would wonder: is piracy a “civilian occupation” to be compared with king crab fishing? It seems more comparable to mercenary work. Certainly the Somali pirates earn less than US-based military contractors. But it should be noted that pay for regular military personnel isn’t really so hot, either. It seems the way risk to the employee’s well-being is factored into pay is wildly different in different contexts.

    You were awesome cross-posting at TNC’s place, as predicted.

  • Brendan I. Koerner

    @Mr. Shrimp: Yes, it’s a problematic comparison for the reason you cite. The FT argument is that pirate organizations are structured like corporations, complete with salaried employees, and so deserve consideration as quasi-civilian.

    A more appropriate comparison might be between Somali pirates and employees of private security firms such as Xe (nee Blackwater). I wonder if there are any statistics floating around about the fatality rate in that line of work? (I’m guessing not, based on those companies’ penchant for secrecy.)

    Also, thanks for the kind word about the TNC guest stint. Good times, good times…

  • ADW

    If I was going to strike a comparison, I’d have to compare Somali pirating to the hierarchy of street to mid-level drug dealing, in terms of danger and risk. Drug dealing isn’t a legal occupation, of course, but neither is pirating.

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