Saudi fails in job Saudisation

Nearly half Saudi Arabia’s private sector companies are not abiding by new government rules to raise the level of Saudi work force despite warnings they could be deprived of new work visas, according to the ministry of labour.

In a report issued this week, the ministry said around six million expatriates dominate jobs in the Gulf Kingdom’s private sector while nearly one million Saudis remain unemployed despite economic recovery.

The report was issued after the enforcement of the country’s most aggressive job Saudization initiative, dubbed Nitaqat (ranges), that divided private sector establishments into two main categories—excellent and green firms with high Saudi work force percentage, and yellow and red with low Saudi percentage.

“Almost 50 per cent of the private sector institutions in Saudi Arabia are in the red and yellow category,” the ministry said.

“Latest statistics show that nearly six million expatriates work in the private sector at a time when around one million Saudi men and women are looking for jobs.”

Saudi Arabia, the largest Arab economy and world’s top oil exporter, launched Nitaqat on June 11 after the failure of previous initiatives to force the more than 300,000 private sector firms to hire more Saudis.

The ministry of labour had given companies in the red zone have until September 11 to adjust to the new job regulations while firms classified as yellow were given until December 11. In a recent statement, the ministry said it is working on 21 initiatives intended to encourage the private sector to recruit more Saudis and at the same time tempt newly-employed Saudis to stick to their jobs.

“These involve a wage protection system for Saudis, job security and the opening of 18 labour offices across the Kingdom to help both parties round the clock.”

Analysts described Nitaqat as the most radical measure taken by the Saudi government to force its massive private sector to employ more Saudis following the failure of previous procedures and expansion in local unemployment.

The programme comes amidst reports that unemployment in Saudi Arabia is widening because of the private sector’s preference of the cheaper expatriate labour and the fact that the population is growing faster than the economy.

Labour minister Adel Faqih has put the official unemployment rate in Saudi Arabia at around 10.5 per cent at the end of 2010. But he noted female joblessness largely exceeds that rate, standing at 26.6 per cent. Unemployment among high school graduates is also as high as 40 per cent.

He said foreigners work in the Saudi private sector account for around 90 per cent of the sector’s total work force.

“Within Nitaqat programme, there will be no room for cheating the system and all companies are advised to adhere to the rules,” Faqih warned.

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