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Young, out of work, and unemployable

Young, out of work, and unemployable

The Middle East has a large pool of young people able to fill gaps in the workforce. So where are they?

April 14, 2010 4:47 by

“We’ve said, ‘Why don’t you forecast the future needs – looking across different sectors and geographical areas?’ If we can do it in Shanghai, across more than 500,000 commercial organizations, we can do it here,” he said.

According to Arkless, the Shanghai-based research conducted by Manpower, which spanned a population of around 26 million people, led to growth of around 15 percent across the small to medium business sector within two years.

Young and unemployable

Across much of the Arab world, labor demands drastically outstrip the supply of workers. Some of the most striking examples of this are in Saudi Arabia and the U.A.E. According to figures quoted by Arkless, Saudi Arabia requires around 1 million skilled workers per year over the next 18 years, with the government allocating a record $37 billion to education during its last budget in an effort to meet capacity demands. In the U.A.E., the Labor Ministry forecasts it will require around 250,000 skilled workers per year to meet its economic growth targets.

Despite this need, and the relatively young demographics across the region, the unemployment rate within the Middle East is among the world’s highest. According to a recent Gallup study, this sits at 9 percent, compared to a global average of just under 6 percent. The same study also found that around 32 percent of the population across the Middle East is between 15 and 29 years of age.

According to Arkless, the low workforce participation rate among local populations across the Middle East defies these demographics, which he believes suggest an ideal resource to fill the skills gap. But in order to harness the workforce potential this represents, governments in the region need to understand how to motivate the local workforce.

“Historically, when a nation gets oil-rich, typically what they do is bring in foreign expertise to drive the economic growth. But what has happened here [in the G.C.C.] is that the foreign labor has stayed, and what you see is a marginalization of the local workforce set in,” he said.

Across the G.C.C., workforce representation of nationals is uniformly low. According to 2009 figures from Madar Research, only 13 percent of the U.A.E.’s workforce comprises Emiratis. In Qatar, this figure is just 12 percent, with similarly low numbers across the G.C.C. Only in Bahrain does the number of nationals in the local workforce outnumber expatriates, and even then only narrowly, at 51 percent locals to 49 percent expats.

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  1. TB on April 14, 2010 5:13 pm

    Perhaps getting rid of the free DEWA, property, etc, might help? There’s not a lot of incentive to bother going into the workforce when you’re supported by subsidies and freebies from the government.

    Removing or lowering the quota system for hiring Emiratis would probably help too. Talk to many UAE-based business owners and you’ll hear plenty of stories about Emirati employees who do little more than turn up, collect their cheques and go home again. Some Emiratis are wonderful and capable workers, and they are like gold dust. Make getting a job harder and more competitive and you’ll force modern kids to up their game.

  2. Miss Anne Thropic on April 21, 2010 1:38 pm

    Lowering government salaries and amending government job working hours so they are in line with private sector salaries, rather than throwing money at private companies to hire Emiratis, would help too.

    At the moment, there is no real incentive for Emiratis to work longer hours for less money in the private sector.

    I know of an Emirati graduate who expects Dh30,000 a month for her first job straight from college with no experience. I graduated from college with five years work experience already behind me and took a job where the salary was the equivalent of about Dh7,000. But I knew that my first job was not going to be my well-paid dream job.

    I have a pretty good job now but it took hard work and experience to get there, rather than an inflated sense of entitlement or the attitude that the world owed me a favour.

  3. Andrew on April 21, 2010 2:55 pm

    Every year the federal and local government discuss the fact that public sector growth both financially and numerically is unsustainable, every year the advantage of the public sector is retrenched financially or otherwise.

    For those in specialised technical roles (ADNOC, ADWEA, etc.) it makes sense they have to compete with both the market and each other, but paying salaries to non-technical staff that are about 3-4 times what you’d expect to get paid in developed countries is nothing more than state-sanctioned benefits.

  4. Miss Anne Thropic on April 21, 2010 4:18 pm

    Yep, pay specialists such as ADNOC engineers well, but Dh30,000+ salaries for desk-bound pen-pushers is insane.

    The aforementioned female graduate was also living at home in Abu Dhabi so it’s not as if exorbitant Abu Dhabi rent has to come out of her unrealistic salary. It is little wonder then that young Emiratis fritter away money on materialistic things, starting with the time they get $130 a week in pocket money.

    The sad part is that it would be so easy to sort out these country’s problems but the local whining about how they all suffer would be heard from space…

  5. Andrew on April 22, 2010 8:11 am

    I’m quite lucky that most of my closest friends are Emirati, however on a few occasions even they’ve rolled out the “I *only* earn 20,000 a month” line. For those who live at home and work in non-technical roles, and still find it hard to live on what is essentially 40,000 pounds a year with no overheads or tax – it astonishes me.


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