Key Points:

European Governments are facing a rising wave of unrest and demands for workers to be shielded from foreign competition as they grapple with the economic crisis.

With unemployment in the European Union's biggest countries rising, or set to rise, faster than at any time since the 1930s, strikes, demonstrations and blockades have shouldered their way into the vocabulary of political debate.

In France last week, public-sector unions stopped work and more than a million people took to the streets to protest against President Nicolas Sarkozy's programme of economic reforms.

In Britain, several oil refineries and other energy facilities were hit by wildcat strikes over the hiring of foreign workers for a big construction contract.

In Greece, farmers blocked border crossings with Bulgaria and Turkey, the country's low-cost agricultural neighbours. They ended the operation after the Government promised subsidies of 500 million ($1260 million) to buttress a slump in local prices.

"Social unrest and protectionism are the two major risks of the world economic crisis," French Finance Minister Christine Largarde said at the World Economic Forum in Davos, Switzerland. "I think it's a risk in Europe. It's a risk elsewhere."

Unemployment in the countries that use the euro rose by nearly a quarter of a million people in December alone, boosting the rate to 8 per cent of the workforce, the highest in more than two years, the European Union's statistical agency, Eurostat, said. Economists warn that this is just the start of a vicious upward ratchet.

According to provisional figures Germany, the biggest EU economy, suffered a jump in jobless of 387,000 in January, to almost 3.5 million, rising from 7.4 to 8.3 per cent. The European Commission expects unemployment in France to rise from 8.5 per cent as of last November to 10.6 per cent next year.

As the pain rises, so has resentment towards those held responsible. In September, the demise of the titans of the financial industry was viewed with glee in Europe, but as an abstract event.

In January, as jobless queues lengthen, these figures are being publicly pilloried. In Britain, characters such as Fred "the Shred" Goodwin, former head of the Royal Bank of Scotland, have become figures of hatred, wizards who destroyed banks with crazed lending policies, ego-driven expansion programmes and over-generous bonuses.

Acknowledging the shift in mood, many top bankers stayed away from the Davos huddle this year. Outside the Alpine venue, demonstrators marched with a banner reading, "You Are the Crisis".

The former United Nations rapporteur on human rights, Jean Ziegler, lashed the gathering of the elite as "the vampires' ball".

"There's still an overwhelming focus on the fact that this is just a financial crisis. There's almost no acknowledgment that it's a crisis of unemployment, which is a social timebomb," said Sharan Burrow, head of the International Trade Union Confederation.

A backlash against globalisation will inflict internal stresses in the EU, whose border-free labour market enables individuals and companies to bid for work and contracts across the 27-nation bloc.

Last week's unexpected strikes in British oil refineries were directed at the use of Italian and Portuguese contractors for a 222 million building project at a plant in Lincolnshire. The strikers said the jobs should have gone to British workers.

The British Government has taken a tough line, pointing out that many Britons benefit from working in the EU under its internal market regulations.

United States President Barack Obama has inherited some unexploded bombs from the Bush era when it comes to transatlantic trade.

There is already a tit-for-tat tariff war, in which the US has slapped high duties on European products, including France's cherished Roquefort cheese, in retaliation for a ban on American hormone-treated beef.

These disputes were politically containable before the crisis, but now are being seized upon by vocal interest groups.

With European governments weakened and the EU institutions divided by the crisis, the rows could provide the raw fuel for a protectionist conflict if Obama yields to Congressional pressure for "America-first" trade policies.