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Qatarisation in Private Sector May Take a Hit


Qatar : 14 September 2011

Source: The Peninsula

Qatar might find it hard to press ahead with its much-talked-about job nationalisation drive in the private sector after the huge salary hike announced for state jobs recently, observers of the local employment market say.

As it is, nationals generally abhor taking up private jobs due to relatively low pay packages, lack of incentives like social security and post-retirement benefits and interest-free long-term housing loans.

Additionally, working hours in the private sector are longer and one is exposed to a competitive work environment where one needs to continuously prove one’s job worthiness.

State jobs are considered cushy and socially prestigious by employment-seekers in the Qatari community, so the substantial pay hike announced for state staffers recently is most likely to severely impact the Qatarisation drive in the private sector, sources point out.

“First of all, the state’s pay hike move is unfair for all private sector employees, whether nationals or expatriates, because their remunerations remain quite low,” said a former board member of the Qatar Chamber of Commerce and Industry (QCCI), representative body of the private sector.

Secondly, the move is sure to put ’serious obstacles’ to the government’s efforts to push more and more citizens into private jobs, the ex-QCCI director said asking not to be named.

Qatar’s National Development Strategy (2011-16) which is part of Qatar National Vision 2030 envisages raising the ratio of nationals in private jobs to 15 percent from the present five.

But job market sources say that if one excludes banking and financial services institutions as well as listed companies which employ a fairly large percentage of locals, the ratio of citizens in private sector jobs would not be more than one percent.

The aim of the National Vision 2030 is to eventually turn the country’s economy which is largely reliant on the finite hydrocarbon resources, into a diversified knowledge-based economy.

This is possible only if the country moves fast towards a high-productivity labor force with higher participation by the locals. So productivity will be a critical driver in this process.

Although unemployment rate in the Qatari community is quite low, official data show that while the government and mixed sectors employ some 11 percent unskilled and three percent semi-skilled nationals, the percentage of these categories of Qatari workers in the private sector is nil.

Most Qatari private sector employees (75 percent) are highly skilled. “This means that to be able to get a respectable private sector job a Qatari must not only be highly educated, experienced and competitive but must also be willing to worker harder,” say job market sources.

But since government jobs do not usually demand very high academic qualifications and simultaneously offer better salaries and perks, this would lead to an unwanted mismatch and trigger frustration among Qatari private sector employees, say job market sources.

However, when told about this, a senior official from the Ministry of Labour said that middle-management jobs in the private sector offer more salaries and perks than the public sector.

“I am a manager-level employee and my monthly pay packet is QR45,000 whereas a bank manager gets QR65,000. In addition, he has access to free medical insurance for him and family and gets huge allowance for his children’s education,” said the labor ministry official.

Before the recent pay hike, the salaries in the private sector were quite low, he said. Citing an example, he said an army official was paid only QR19,000 but with the recent raise his salary will now be QR48,000.

Experts say that one effective way to encourage citizens to take up private jobs is to introduce social security and post-retirement benefit schemes as well as provide easy access to interest-free housing loans.

Locals don’t prefer private jobs mainly because of the lack of these facilities, job market source say. But the labour ministry official hinted that soon pension and housing loan schemes would be made compulsory in respect of Qatari workers of the private sector.

Meanwhile, private companies, including listed entities, are worried that due to the salary hike in the government sector they might have to raise the salaries of their Qatari employers which might increase their overheads and erode their profitability.

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