Photo: Flag of Saudi Arabia
The latest measure of the Saudi Arabian government to promote the recruitment of local workers has set off controversy among political and economic authorities of the Arab kingdom.
The government of Riyadh has been trying unsuccessfully for years to increase the percentage of Saudi workers in all areas of the economy. Saudi Arabia has a population of 32.6 million people (20.4 million Saudis and 12.2 million foreigners). Regarding the active population, the proportions are reversed: there are 13.5 million workers (5.8 million Saudis and 7.7 million foreigners).
The generous income from oil that has enriched the State for the last decades has allowed a significant part of the Saudi population to enjoy a certain standard of living through subsidies, discounts, fiscal exemptions and the access to jobs in the public sector. But in recent years, because of the increase in population, the economic recession and the prudence in the face of the inevitable reduction in the global demand of fossil fuels as a result of energy transition, the State has launched a plan of economic reforms through the substitution of foreign workers for local staff. At present there are more than 3 million jobless Saudi Arabians and the unemployment rate exceeds 30 percent among the youth.
Until now, the State has encouraged the youth to study and work, and boosted the recruitment of Saudis through plans that were met with relative success. The Saudis are partly responsible for the failure of Saudization in many professional fields because they are reluctant to take lower paid jobs or jobs with less occupational prestige. Besides, the better paid professions require qualifications and experience that, in many cases, only foreign workers can offer.
On this occasion, however, Riyadh has opted for a more expeditious method. It has decided to dismiss the foreigners working in the public sector and to penalize private companies that hire more foreigners than Saudis with new taxes.