Unemployment reaches 27 percent in the Gulf

A recent report has revealed the nine key factors that contribute to the high rate of unemployment among young people under the age of 25 in the region. The report discussed unemployment in the Arab countries in general and the Gulf states in particular. The 27.2 percent unemployment rate is twice the global average.

It is feared that governments won't be able to provide welfare for citizens much longer, based on oil prices and the increase in the population growth rate, as industry and services would not be able to absorb more graduates.

The report released at the World Economic Forum in Switzerland confirmed the need for Gulf states, with the exception of Saudi Arabia, to maintain a foreign work force because of the lack of national human resources, in a time that the middle class has eroded and poverty has risen.

The report compiled by the Department of Statistics stressed the high number of unemployed males in the Kingdom, with 261,000 without jobs in 2013, in comparison with 17,000 in 2012. The number of unemployed women was 361,000 in 2013, up from 358,000 in 2012. This brings the total number of unemployed to 622,000.

The report also pointed out that the unemployment rate for 2013 was 11.7 percent. While the rate of unemployment was 6.1 percent among men, it was an alarming 33.2 percent among women.

Nawaf Al-Dhbaib, a human resources expert, agreed with the report in that the prospects of employment in the private sector in Saudi Arabia are low. He indicated that the lack of investment by the private sector in the training of youth is a result of this fact, and not a cause.

He stressed that keeping a nonproductive employee in the system reduces opportunities for others to be employed properly. He also pointed out that current dealings with the oil wealth distorted the national economy and resulted in the loss of many other industries, making the economy revolve exclusively around oil, as was the case with Norway. Interestingly, Norway was able to overcome this by investing its oil wealth to achieve economic diversification.

He also said that what came in the report does not apply to Saudi Arabia as it does in case of other Gulf states due to the attractive salaries offered by Saudi Arabia in the private sector, whereby the attractiveness to work in the government sector is limited to job security and shorter working hours.

Al-Dhbaib called on employment stakeholders in the public and private sectors to develop a professional guide that explains the functional nature of the work and tasks expected of an employee, in addition to certificates, courses and experiences.

He also called for clarification of the demand for jobs in line with what happens in Australia, where educational institutions review the posts and determine the orientation of study in order to bridge the gap between the output of educational institutes and labor market requirements.

Some of the key factors causing high unemployment in the Gulf are: The output of educational institutes does not fit available jobs in the private sector; employers prefer to hire foreigners; and weak economic diversity prevents graduates studying abroad to work.

The proposed solutions to this, according to the report, include increasing legislative flexibility and balance of labor laws for national and foreign labor forces, the development of educational outcomes and investment in economic diversity for small and medium-sized companies and encouragement of entrepreneurship and increase in funding.