DUBAI/DOHA: When Qatari paramedic Mohammed Majib rushed to Sheikh Khalifa bin Hamad al Thani’s royal palace in the mid 1990s after a call for help, he wasn’t sure what the ailing Sheikh found more shocking — the heart attack he had just suffered, or the fact that his medic was a local. “You’re Qatari?” the former ruler gasped, as Majib went to work. “Ma Sha’ Allah. (God bless you).”
Khalifa’s surprise was understandable. Across the Gulf, and especially in states where rapid growth is driven by oil and gas, locals rarely have hands-on jobs in health – or anywhere in the private sector. In an unspoken pact between rulers and ruled, Gulf citizens seem all too happy to fill plush government jobs, where the pay is high, the hours short, and the work sometimes nonexistent. In the private sector, job after job is filled by South Asians, non-Gulf Arabs and Westerners.
Gulf Arab rulers have known for more than a decade that this is a problem, not least because it hands day-to-day power over whole sections of the economy to foreigners.
Foreign workers make up more than 80 percent of the private workforce in many Gulf states and hold key positions running national airlines, real estate and financial service companies and the media industry.
In response, governments have introduced ‘nationalisation’ schemes aimed at pushing their workers into the private sector.
Oman was the first, setting out in the 1980s to ‘Omanise’ its workforce; governments in Bahrain, Kuwait, Qatar, Saudi Arabia and the United Arab Emirates have all followed.
Typically, the schemes combine tax incentives for private companies to hire locals, quotas, and investment in training local graduates. It’s not working. Most Gulf Arab rulers have found breaking a culture of easy-come government jobs and preparing their citizens for the private sector difficult. Qataris, about 16 percent of the country’s 1.7 million people, still represent just 5 percent of the country’s private-sector workforce, government statistics show. Locals fill about one percent of private-sector jobs in the United Arab Emirates.
Saudi Arabia, with its large native population, has mustered a 10 percent participation rate. “We need to share in the private sector,” says Noora Al Bedur, a director of the UAE’s Emiratisation programme. “The private sector is the backbone of a country’s economy. And citizens have the right to work in this field. That is very important for us.” NEW STRUGGLES Gulf Arabs have come to expect a nice government job as part of what Ingo Forstenlechner, an Austrian academic at the United Arab Emirates University, calls the region’s ruling bargain: the rulers give you everything, but you don’t ask for anything.
“It’s basically buying political acquiescence while distributing the oil wealth,” Forstenlechner says.
That worked fine as long as government jobs were available.
But in places like Saudi Arabia – official unemployment is 10.5 percent, though diplomats and analysts say the real figure is likely to be higher – state jobs are no longer guaranteed. In Kuwait, 12,000 nationals are waiting for government posts.
That’s left young people frustrated. In an extremely rare public protest in late August, around 200 unemployed Saudi university graduates crowded in front of the education ministry in Riyadh carrying posters with slogans demanding government jobs and posters with slogans like “Enough Injustice.”
Experts say unless unemployment is tackled, protests may increase – adding to security risks. “The great majority of those recruited for terrorist activities are the unemployed,” says Mustafa Alani, of the Gulf Research Centre. “The (Saudi) government believes that the question of unemployment is a major problem with huge implications on security.” WHY BOTHER? Part of the problem is that many Gulf nationals still don’t see the point of seeking work in the private sector. In countries such as the UAE, where modest palm frond homes were replaced by glittering villas and skyscrapers in a generation or two, the government says most people are jobless by choice.
Official statistics show 23 percent of Emiratis are unemployed — a rate similar to the Gaza strip.
“These are strange economies – they’re economies that went from being rather poor and undeveloped to overnight having huge amounts of oil money invested in them,” says Paul Dyer, a fellow at the Dubai School of Government who specialises in labour and political economy.
Khalid al Mutawaa, a 26-year-old Emirati who until recently worked as a project manager for an international bank, says the transformation has not been easy. “I think the older generations … weren’t ready for such a huge boom” he says, relaxing after work at a lounge in Dubai’s beachside Ritz Carlton resort. “But I don’t think the young people here were really ready for it either. UAE nationals have a very home-oriented environment. They see family as the priority.”
Many also see a private job as less attractive than a government position, which usually offer shorter working hours and double the pay. “I can’t not see the obvious,” says 23 year-old Abdulla al-Kaabi, son of a date-farmer from the small UAE mountain town of Hatta, an hour outside Dubai.
Sipping coffee inside the massive Dubai Mall while fussing with his three silver mobile phones, Kaabi says he will hold out for up to a year for a government post rather than take a job with a private firm.
“I can work in a bank from at least 8am to 5 pm, and get half the salary that I would get in a government job working 8 to 2. Anyone would choose the better option.”
‘DESIGNED FOR EXPLOITATION’
One factor hindering progress is the fact the nationalization schemes are often disorganized – dropped a few years after they are initiated, only to be restarted later. Saudi Arabia recently relaunched its Saudization program, which includes employment quotas for the number of nationals that must be hired, and an incentive program that pays a portion of a local employee’s salary.
The private sector in the Gulf is also fundamentally ill-suited to absorb nationals, and nationalization schemes offer scant incentive for reform.
How can so many Emiratis be unemployed in an economy with one of the highest growth rates in the Middle East and awash in oil money, Forstenlechner asked in a 2009 research paper?
The answer: the millions of private sector jobs were created with foreigners, not locals, in mind.
“The private sector here is designed for exploitation – for foreign investors and powerful locals to exploit a temporary and cheap foreign workforce. It’s not actually built for employing a permanent, local workforce.”
The huge imbalance between the number of locals and the number of temporary foreign workers means that government quotas for local workers can seem fanciful. The official Qatarization policy aims to have half of its workforce filled by nationals, a quota that most believe is impossible for a country whose indigenous population is less than a fifth of the total. The UAE, which brought in quotas for different sectors 10 years ago, expected many sectors to have at least 40 percent Emirati employees this year. Few companies have met these targets.
In many places there are simply not enough nationals to support growth. Qatar’s GDP is expected to grow a staggering 15.5 percent in 2010, according to a Reuters poll. Saudi will grow by 3.8 percent. Even the UAE, which includes crisis-hit Dubai, is expected to grow by 2.4 percent.
As a result, private employers are forced “to go down the ladder to fill these positions,” says an expatriate communications employee in Qatar, declining to be identified speaking critically of colleagues. “We’re seeing unqualified, inexperienced people in many of these roles.” – Reuters
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May 20th, 2011 
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