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Continuing “Saudization” Proposes Loss of 1.27m Expat Jobs

Saudi Arabia has long found itself between a “rock and a hard place” in terms of expat workers within the Kingdom. On the one hand, the growing Saudi economy requires a considerable workforce, something which has historically been filled by millions of workers from abroad.

On the other hand, concerns have been raised about unemployment levels in Saudi Arabia, where foreign workers often receive the blame. The much-debated process known as “Saudization” has essentially entailed limiting numbers of expat workers so as to provide opportunities for local workers and ease pressure on public services like healthcare.

At present most companies in Saudi Arabia are obliged to employ a native population equating to at least 5% of their workforce, but some senior officials are calling for this to be raised to an unheard-of 20%. Such a policy has been estimated to free up 1.27 million jobs for local workers.

Furthermore the proposals would aim to ensure fair working conditions for Saudis by carefully specifying salaries and benefits. Doing so would ensure that private employers stuck firmly to the agreement and that Saudi workers would be suitably rewarded for their efforts.

While some of the most common sources of expat employment have historically been within the oil industry industry and construction in major cities, the latest Saudization proposals aim to target more rural areas.

Outside of Saudi Arabia’s major urban hubs, native Saudi unemployment is much higher, which has become a cause for concern among the Saudi government. If proposals are approved the Council of Saudi Chambers (CSC) claims that over a million existing jobs could be made available for local workers.

While this would undoubtably be a sad situation for the many expat workers – especially those from the Indian sub-continent – who rely on expat remittances to support their families, the program would help vast numbers of rural native workers into employment.

The process of Saudization seems reasonable on the face of it, but it is not without its critics. Firstly, experts point out that it is essential that expat workers are replaced with equally-skilled native workers. The rapid exit of a large and skilled workforce has the potential to cause problems in the economy if not handled in a controlled and measured way.

Secondly a number of prominent Saudis themselves have aired concerns as to whether this new proposal will work in reality. They point to the way that many of these expat workers are doing jobs that many Saudi’s would consider beneath them. They question whether native Saudi’s would be willing to take on more manual jobs that have historically been seen as the preserve of foreign workers.

It is important to state that as yet these proposals are a long way away from unanimous agreement. Further discussion is essential as to the validity of these suggestions, but if approved they could significantly affect the expat population in Saudi Arabia.

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