“The Arabist” blog runs a good piece addressing the multi-faceted issue of unemployment in Saudi Arabia that focuses on the contradictory economic pressures that necessarily limit Saudi employment. No matter what the newest Saudization program is called, unless and until the contradictions between low salaries paid to foreign workers and high salaries being demanded by Saudis is resolved, there’s no solution.
Fixing Saudi unemployment — more than creating jobs
Great Tuesday [Nov. 13] Washington Post piece by Kevin Sullivan on Saudi women and unemployment. The part at the end on Saudi labor policy and the two-tier labor force is critical.
What Sullivan doesn’t address in much detail though is how the presence of so many foreign workers has distorted wages in the private sector, and causes the unemployment problem to persist in a country where there are literally millions of jobs that Saudis could be working.
Importing foreign labor was necessary initially because for the first several decades of the Kingdom’s development the Saudi labor force was not nearly large enough. Harder to understand is why the situation has been allowed to persist through the present, when despite a reasonably qualified Saudi labor force, the ongoing option of easily hiring workers from countries such as the Philippines and India still exists.
With the option of hiring cheaper foreign workers so readily available, employers have become addicted, and a perverse situation exists where many firms can not afford to hire Saudis but most Saudi nationals can not make even a modest living wage in their own private sector.