By P.K. ABDUL GHAFOUR | ARAB NEWS
Published: May 9, 2011 00:43 Updated: May 9, 2011 00:43
Private firms to be classified into green, yellow and red categories depending on progress of employing locals
JEDDAH: Saudi Arabia announced Sunday new plans to intensify the Saudization of jobs in private companies as part of efforts to reduce the unemployment rate.
According to official statistics, there are more than 448,000 Saudi jobseekers, including women, in a country with eight million expatriate workers.
Labor Minister Adel Fakieh said private companies would be classified into green, yellow and red categories considering their performance in the Saudization of jobs.
“We have set out new standards to assess the employment of Saudis in private firms. We have differentiated between companies that have achieved high Saudization rates and those refusing to employ Saudis,” he said.
He said companies in the red category would be prevented from renewing work visas of their expatriate workers while companies in the green category would be allowed to select foreign workers in the other two categories and transfer their sponsorship without the approval of theirs employers.
Fakieh said the new Saudization plan has been designed to keep most private companies in the green category and considering the reality of the labor market. He said details of additional incentives given to Saudization-friendly green companies would be announced on June 11 on the ministry’s website.
The new measures came after Custodian of the Two Holy Mosques King Abdullah set up a high-level ministerial committee to find a quick way to employ the growing number of graduates in public and private sectors. The king increased the minimum salary of Saudis to SR3,000 and ordered payment of a SR2,000 monthly allowance for the jobless.
Fakieh acknowledged that the real number of the unemployed could be higher than 448,000, because of the increasing number of Saudi university graduates. He also pointed out that about six million of the country’s eight million expatriates work in the private sector.
“These expatriate workers cost the Kingdom SR98 billion annually in terms of transfer of salaries to accounts in their respective countries,” the minister said. “They also put additional pressure on the country’s infrastructure and service sectors.”
Fakieh said there was a five-percent annual rise in the number of expatriate workers, which is double the size of annual Saudi population increase. “This increase of expatriates is causing imbalance in the job market and preventing Saudis to get jobs in private companies. Most companies prefer to employ expatriates as they are ready to accept low salaries,” he pointed out.
He said the new measures were taken as previous Saudization plans were not successful due to various reasons.
Saudis working in private companies do not exceed more than 10 percent of the total workforce. He also pointed out that 84 percent of expatriate workers carry only secondary school certificates, adding that these unskilled expatriates could be replaced by Saudis gradually.
Fakieh said companies who had poor Saudization record would be given a time limit to change the situation before preventing them from enjoying the new facilities and incentives. “Saudization has become a national necessity rather than a choice,” the minister said, adding that it would boost the economy.