Riyadh promotes employment of Saudi citizens

Sunday 26/03/2017
Changing course. A Saudi man walks past a sign that reads “Saudi employees are wanted.” (Reuters)

Riyadh/Dubai - Saudi Arabia plans to tight­en restrictions on foreign workers to pressure com­panies into hiring more Saudi citizens, govern­ment sources have said.
The new policy is designed to help the conservative kingdom achieve one pillar of its economic reforms launched last year: Reduc­ing Saudi unemployment from the current 12.1% to 9% by 2020.
But by making it harder for firms to employ low-paid foreign work­ers, the policy will raise costs and potentially complicate other as­pects of the Saudi reform drive, such as developing private-sector businesses and diversifying the economy beyond oil.
The new rules could have a huge impact on a large segment of Saudi residents. There are cur­rently about 12 million foreigners working in Saudi Arabia, many of them doing the strenuous, danger­ous and lower-paid jobs shunned by the 20 million Saudi citizens. About two-thirds of Saudi workers are employed by the public sector.
Under a programme launched in 2011, the Saudi Ministry of La­bour grades firms according to its ratio of Saudis in their workforces. Companies with higher ratios get preferential treatment when ob­taining visas for foreign workers or licences; those in lower categories face penalties.
Under the new policy, construc­tion firms with between 500 and 2,999 workers would have to em­ploy 100% Saudis to be in the top “platinum” category; if they em­ploy 10%, they are rated “lower green”. This compares to current levels of 16% for platinum and 6% for lower green.
In the retail sector, a large com­pany’s current percentages are 35% for platinum and 24% for lower green. This would rise to 100% for platinum and 35% for lower green, according to an official document seen by Reuters.
Similar policies will be imple­mented in many other sectors, ac­cording to the document, which lists more than 60 industries in which restrictions will be applied.
Some change is already occur­ring in Saudi employment practice, with many citizens now working as cashiers and sales people in retail shops — the sort of jobs previously seen as undesirable. But there is still a scarcity of Saudis willing and qualified to work in the construc­tion sector.
The new policy has been ap­proved by Labour Minister Ali bin Nasser al-Ghafis, the sources said. It is scheduled to take effect on September 3rd, according to one source speaking on condition of anonymity because an official an­nouncement is yet to be made. (Reuters)