- Saudis prefer public sector for perceived job stability
- IMF warned that "comprehensive reforms" are necessary
- Private-sector workers feel like they work in another country
This is the second article in a two-part series exploring employment in Saudi Arabia.
Saudis largely favor jobs in the government over the private sector, and this has significant implications for the kingdom's workforce.
This reluctance for employment in the private sector is echoed in other areas of the Gallup surveys. The primary reason for Saudis preferring a job in the public sector is perceived job stability. About seven in 10 Saudi nationals (71%) say that the statement "provides stable jobs" applies mostly to the public sector, compared with 25% who say this mostly applies to the private sector.
A majority of Saudis (55%) associate the private sector with offering attractive salaries, compared with 36% of Saudis who link this with the government sector. Nevertheless, Saudis would still choose a job in the public sector in spite of the perceived lower pay, given the anticipated stability such jobs provide. Even those who are unemployed would prefer a public-sector job, given the perceived stability.
The Nitaqat program -- which was enacted in 2011 -- is meant to act as a safeguard for absorbing more Saudis into the private sector. Gallup data show, however, that just 34% of Saudis associate the private sector with being committed to attracting nationals, compared with 55% who attribute this to the government sector. The majority of Saudis also associate the private sector with preferring to hire expatriate workers (79%), while only 14% think that the government sector prefers to hire expatriate workers.
Gallup surveys also show that among unemployed Saudis, seeking a job in the private sector is hardly the preferred option; only 17% would opt for private-sector employment, compared with a solid majority of 81% who would prefer to be employed by the government.
IMF Says Comprehensive Reforms Are Needed
The International Monetary Fund (IMF) has warned that "comprehensive reforms" are necessary for Saudi Arabia and other Gulf Cooperation Council (GCC) economies to reorient their hiring practices to include more private-sector employment among nationals. The percentage of Saudis in the private sector grew just four percentage points between 2011 and 2013, from 10% to 14%. The IMF also stresses that increasing the number of Saudis employed in the private sector is not just a matter of creating demand for jobs; it will require a supply of technically qualified Saudis who can compete with expatriates for these opportunities.
The Saudi government has invested heavily in the proliferation of technical education. But this does not mean that Saudis seeking jobs find themselves in a better bargaining position as a result just yet. When they look across their borders into the rest of the Gulf, they see that they are making less money than their counterparts in other GCC countries. It is worth noting that the average salary of Saudis in the private sector is the lowest in the GCC. Overall, the average monthly salary of Saudis employed in the private sector is 6400 SR per month, compared with 15,200 SR per month in other GCC countries.
Though economic changes are required to increase Saudis' employment in the private sector, the private sector will also need to adapt to create the work and cultural environments conducive to including Saudis, particularly Saudi women. Assimilating Saudi females in the private sector will require businesses to be sensitive to cultural norms, such as the separation of female and male employees in the workplace, a condition that is largely unique to Saudi Arabia. At the same time, it may also require some easing of cultural norms to meet the private sector's needs halfway.
Another barrier that will need to be overcome is the 90/90 employment gridlock, where about 90% of Saudis are employed by the government and 90% of the jobs in the private sector are filled by about 7 million Arab and non-Arab expatriates. This nationality imbalance could take a psychological toll on private-sector workers, particularly Saudi females, resulting in feelings of isolation or alienation in their workplace. Assimilating Saudis in a complex, multicultural work environment will require expatriates and Saudis to make conscious efforts to accept each other -- and to overcome any stereotypes affecting the perceived value of their respective contributions at work.
Saudis Need More Than a Good Salary to Prosper in Private Sector
While the Saudi government and the private sector reconsider the economic options for attracting Saudis to the private sector, cultural factors must also be given equal attention. For example, Saudis need more than a good salary to prosper in the private sector: They need to feel welcome and that companies want to hire them for their skills, not just because they are filling a quota. The current lopsided distribution of Saudi and expatriate workers can also lead to feelings of alienation among Saudi private-sector employees.
The rationale behind why Saudis overwhelmingly prefer a job in the government sector -- because of perceived job security -- becomes more understandable when cultural, psychological and economic variables are factored into the employment equation. Right now, Saudis believe the government sector provides the best of all worlds, while the private sector has yet to be competitive. It is pointless to point fingers and assign blame for this imbalance. It is time to research and reflect on how to assimilate Saudis in private-sector work environments so they can thrive.
Results are based on telephone interviews with 2,535 Saudi nationals, aged 15 and older, conducted between 2013 and 2015 in Saudi Arabia. For results based on the total sample, one can say with 95% confidence that the margin of sampling error is ±2.5 percentage points. Results are based on interviews ranging from 683 to 760 Saudi adults each period. The margin of error reflects the influence of data weighting. In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.
For more complete methodology and specific survey dates, please review Gallup's Country Data Set details.
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