Employment in the public sector is not the right way forward for the job market. There is no other way to say this.
Following a high-level retreat that took place at the start of 2021, the UAE announced ‘Projects of the 50’ - its various economic and other plans around its golden jubilee. Of significance is that the government is determined to shift primary employment in the job market from the public to the private sector.
The plan, intended to attract 75,000 Emiratis into the private sector, would cost the government more than $6.5 billion over five years. The amount will be divided among financial schemes to top-up salaries in the private sector and pension subsidies.
The announced projects are expected to recalibrate the private sector’s workforce composition from wherever it stands today to a minimum of 10 per cent by the end of the fifth year.
While the announced plan is to last for a period of five years, it must be noted here that the main intention is not just to absorb 75,000 Emiratis into the private sector, but to create an ecosystem in the job market that would, hopefully, generate its own momentum. The plan, for instance, does not freeze employment in the public sector or salary increases in it.
However, one of the announced projects targets employment in the public sector through early retirement. Meanwhile, another project allows sabbatical leaves for Emiratis in the public sector to start their own businesses.
Moreover, with a budget of Dh1 billion, another initiative provides micro loans for fresh graduates to pursue their business ideas. All in, the ecosystem bets on lowering the appeal of joining the public sector and increasing that of working in the private sector.
Make those 5 years count
The most important thing to note here is that the announced projects will make it easy for the private sector to recruit and retain Emiratis for a period of five years at least. Notwithstanding what happens after five years is anyone’s guess, strengthening the abovementioned ecosystem in the job market would create and retain momentum and longevity in the announced projects.
To illustrate, and in light of the announced projects, there would be increased competition in the private sector, through financial schemes and other initiatives, to attract and retain talent. Presumably, the projects announced by the government, along with future initiatives by the private sector, would increase the average salary level.
Therefore, what the private sector decides to do next could either keep up the momentum beyond the five years period, or not.
Seeding the job market
After all, the announced projects are only expected to create the right circumstances for increased employment in the private sector, which could not be timed better than during a pandemic that shook the job market to its core. Yet, the announced projects, with or without the 10 per cent quota mentioned earlier, must be not taken for granted and must be utilised to help increase employment in the private sector.
The private sector could play an even bigger role by partnering with the government in the fund set aside to finance business ideas by fresh graduates as well as to transition government employees into the private sector, more so for ones who would favour moving into the private sector instead of starting their own businesses.
The private sector could also play a role in the subsidised sabbatical leaves for federal government employees. This can be done either by hiring those employees on temporary consulting contracts, in effect partially financing the sabbatical leaves, or by financing the business ideas.
Provide that feedback
Upon implementation, the private sector’s feedback would be paramount in tweaking the announced projects, if need be, to ensure the desired recalibration of the job market is done right.
The right recalibration of the job market would see the role of the government in the job market shrinking further from a main employer and subsidiser of employment in the private sector to a regulator. The onus of job creation and employment would thus be on the private sector.
The ecosystem that government projects and initiatives, and the private sector’s constructive role in implementing them and providing feedback on them, would encourage and facilitate the self-employment part of the job market.
Done right, that would further feed into private sector employment and further diminish the government’s role in the job market, so on and so forth.
Whether by being part of the graduate fund or the subsidised career break, the private sector stands to gain from business ideas that may prove beneficial for it in the long-term. In the process, the private sector would also be privy to recruitment and other opportunities that would further increase the percentage of Emiratis in the workforce beyond the five-year period.
Since the graduate fund is in collaboration with universities in the UAE, interested companies from the private sector would have first-hand access to talent beyond the 10 per cent quota.
More importantly, the private sector must take advantage of the announced projects to help establish the right ecosystem that would nurture and grow business ideas that would help expand the private sector and employment by it. Feedback from the private sector, and agility by the government based on that feedback, would go a long way in recalibrating the job market once and for all.
The government has taken the first step, and it is now up to the private sector to make the best use of the announced projects for the betterment of the UAE’s economy and its job market.
The last thought that I want to leave you with: Since announcing the ‘Projects of the 50’ a year ago, did the number of Emiratis in the private sector increase?