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Labor Minister Says 5 Million More Saudi Jobs Are Needed By 2030

Saudi Arabia : 27 January 2011

Minister of Labor Adel Fakieh commented that in response to a surge in Saudis entering the job market, there is a need for 5 million new jobs to be created in the Kingdom by 2030. That works out to 250,000 per year for the next two decades and the expectation is that most of those positions will be in private industry.

As the keynote speaker at the fifth GCF (Global Competitiveness Forum) this week, the minister stated that rapid action is necessary before unemployment figures see a drastic rise. Hand in hand with that trend would be a drop in salaries for Saudis as the available workforce grows.

During his speech and in the panel that followed Fakieh gave indications that those in power are considering a broad range of scenarios in order to loosen up the job market. Possibilities include an enforcement of minimum wage, although the minister noted that anything with the potential to harm competition within the economy would be avoided. Fakieh stated that major sponsorship reforms were also on the table of possibilities. There is a salary gap between expats and Saudi citizens that needs to be shrunk and a level playing field is required. Without that the benefits of hiring expats will remain strong.

Out of those 5 million positions required by 2030, Fakieh stated that a full 3 million needed to be within the higher wage bracket, in tourism for example. Achieving this level of creation will demand major transformation across the board in Saudi Arabia. Improvements within the education system, an alteration of practices in management, reforms within regulations and policies and the removal of subsidies are specific examples. Also, the difference between rules within the public and private sectors needs to be addressed and eliminated.

In the face of this enormous challenge to create a quarter million jobs per year the Labor Minister remained confident that government plans were on the path to success and noted that the jobless rate will begin to drop soon.

The need for job creation aimed at Saudi women was also mentioned by the minister, although specific data was not discussed. The target of 5 million jobs is in relation to male workers only. Figures from the 2010 census shows there are 9.5 million males and 9.1 million females in Saudi Arabia. Based on the 2.3 percent rate of population growth quoted by the minister, as well as the age of the population (70 percent are under the age of 30), there will be an average of 250,000 Saudi males coming into the labor market every year for the foreseeable future – totaling 5 million from now until 2030. Those figures are only taking the males into account. Due to the fact that it is now more economically necessary for women to bring in an income, and the government states a desire to see more women in the labor force, expectations state that a further 100,000 jobs in Saudi at a minimum should be created.

Paul Holdsworth, Staff Writer, Gulf Jobs Market News
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