The Impact of Emiratisation and Saudization on the GCC Region

​The Gulf Cooperation Council (GCC) has implemented policies to increase citizens' labour-force participation. The initiatives of Emiratisation in the UAE and Saudization in Saudi Arabia prioritize local resident employment in various sectors. These policies have significantly impacted the labour market, economic diversification, and the overall development of the region.

Reducing Dependence on Foreign Labour:

One of the primary objectives of Emiratization and Saudization is to reduce reliance on expat labour and increase employment among local citizens. The GCC countries have historically relied heavily on outside talent to meet their labour needs. This requires a multi-faceted approach that includes policy implementation, education and skills development, career development initiatives, and economic diversification. While foreign workers have traditionally been critical to the development of these countries, the emphasis on national employment aims to reduce unemployment, strengthen national identity, and create a more sustainable and self-reliant workforce.

Unemployment and Skills Development:

Implementing Emiratisation and Saudization has been difficult, especially in addressing unemployment and closing the skills gap. The policies aim to boost local participation in traditionally expat-dominated industries like construction, hospitality, and retail. Addressing these issues requires ongoing commitment and collaboration among educational institutions, government agencies, and private-sector employers. Improving vocational training, education, and skill development programs is essential to provide nationals with the necessary skills and qualifications for these industries. However, matching citizens' skills and qualifications with available positions takes time. To assist nationals in finding suitable employment, efforts are being made to improve the career guidance system, mentorship programs, and internships.

Economic Diversification and Knowledge Transfer:

These policies aim to develop a skilled workforce capable of driving growth in non-oil sectors by encouraging the employment of nationals. Knowledge transfer from expatriate workers to nationals is critical, as expats bring extensive experience and expertise in various sectors, which can be transferred to local citizens to develop innovation, entrepreneurship, and growth in a knowledge-based economy. This knowledge transfer helps locals acquire skills, best practices, and industry insights, contributing to developing new industries, enhancing productivity, and stimulating economic growth in non-oil sectors. The transfer also creates a skilled workforce that can adapt to emerging technologies and market demands. Additionally, the knowledge gained from expat entrepreneurs can inspire entrepreneurship among nationals, enabling locals to develop their businesses and contribute to economic diversification.

Impact on Businesses and Workforce Productivity:

While the policies are meant to increase local employment, they may first result in higher labour costs. Adapting recruitment practices and ensuring compliance with these quotas may also call for additional resources and investment from employers. However, businesses have also recognized the benefits of having a diverse workforce as it promotes a culture of inclusion and brings different perspectives, experiences, and skills. It boosts employee morale and loyalty and instills a sense of pride and ownership, resulting in a stronger connection to the organization and its goals. Employees who feel valued and represented are more likely to be satisfied and productive.

Challenges and Future Considerations:

These policies have had a profound impact on labour markets, economic diversification, and the region's overall development. While challenges persist, progress in reducing dependence on foreign labour, developing knowledge transfer, and enhancing national skills and capabilities is commendable. The success of Emiratisation and Saudization will depend on ongoing efforts to address skills gaps, promote entrepreneurship, and adapt to evolving labour market dynamics in a globally competitive landscape. Balancing national employment with a conducive business environment remains a delicate task. 

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