The creation of jobs in Arab countries, including the Arabian Gulf, is likely to top the list of priorities over the next decade — given that a recent study by the World Bank found that Arab nations need to create 100 million new positions by 2025.
This poses a real challenge, especially with the increasing number of unemployed in the region. The ways to solve this problem is multi-faceted and involves not only revising previous economic policies regarding employment, but those relating to investment, economic restructuring and foreign investment.
Employment policies in the Gulf Cooperation Council (GCC) countries have relied basically on state agencies over the past four decades, especially with regard to employment of GCC citizens, where the state played an active role in offering job opportunities.
From the beginning, these agencies were in urgent need of various scientific and vocational specialists, so it was not difficult to employ thousands of jobseekers. State agencies then recruited thousands of foreign workers, because rapid growth required a similar expansion in government departments.
Diminished scope
But with the completion of infrastructure projects, the increasing number of citizens and the completion of the basic structure of government bodies, the capacity of employment in government agencies has diminished greatly in the past few years.
Among other reasons for this is that state agencies have been relying increasingly on modern technologies in administration, including the expansion of online services. This coincides with an increase in the number of jobseekers, mostly highly qualified and university graduates, thus leading to disguised unemployment in some Gulf countries and others due to overstaffing in state agencies.
The labour surplus constitutes a burden on general expenditure, pensions and the social security system, in relation to the early retirement scheme.
This is a phenomenon that has recently become a habit among many employees in the GCC, despite the fact that average life expectancy has reached the level of European countries, thanks to improved health care. In Europe, on the other hand, one finds a reversal of this trend with the age of retirement increasing.
In light of this, there is a considerable difference between the nature of future development that will give a greater role to the private sector and the employment policies embraced by official bodies which cannot accommodate job seekers, constituting a major challenge to development in the Gulf over the next few years.
There is a hope that the private sector in the GCC will be able to accommodate the growing number of job seekers, especially since the contribution of the private sector to non-oil gross domestic product (GDP) is growing year after year.
Weak response
Unfortunately, there is a very weak response by private institutions to resolve this issue, noting that the consequences can be harmful to its own interests if government alone offers job opportunities. This issue needs an urgent solution.
Since the issue of employment cannot be imposed on the private sector without its cooperation, it is necessary to enact laws in the Gulf to support this approach in collaboration with chambers of commerce and industry.
Dr Mohammad Al Asoomi is a UAE economic expert and specialist in economic and social development in the UAE and the GCC countries.
