Avast Ye Furriners! Arab Spring and 'Saudization'

One of the more interesting angles that migration researchers have focused on in recent years has been that of South-South migration. While the common perception we have of economic migration is of those from developing countries travelling to developed countries, about half of all migration occurs between developing countries themselves. That is, there are gradations of economic development and opportunity between, say, Ukraine and Russia or Bangladesh and India.

It is well-known that workers with various skill levels ranging from Sri Lankan construction workers at one end to British bankers at the other have travelled to the Middle East in droves over several decades. Aside from providing manpower that relatively small countries there lack, they provide technical expertise not necessarily found among Mideast elites. Right? Well, maybe not for so much longer. As the Arab Spring seems to be demonstrating, there is a lack of employment opportunities for Arab youth in many of the MENA countries, often resulting in outpourings of negative sentiment against monarchical classes. But, it also poses the question of how much citizens of these countries would tolerate '3D'-type jobs: difficult, dangerous or dirty.

As a student of regional integration schemes, one of the common refrains you get from the Gulf Cooperation Council is to hire less foreign workers and employ more locals. Like in other regions, skilled migration that aims to keep talent within the Middle East is a common objective. Here is a typical example:

Implementing the Supreme Council’s resolution in the previous session with regard to employment of the national work force, and in order to facilitate their mobility from one Member State to another; and with a view to increasing the job opportunities for the GCC citizens and to nationalize jobs in the various sectors, and to achieve coordination among the Member States in this field, the Supreme Council approved the views of the Consultative Commission in this regard. The Council decided to assign the Consultative Commission with the task of undertaking an evaluation of the process of joint action in the field of economy, asking it to present its views in the 21st session of the Supreme Council.

Again, it seems the Arab Spring has spurred efforts to employ more locals. Take Saudi Arabia, for instance. For years and years, Saudi Arabia has been among the top destinations for Filipino migrants. While they have a fairly vast range of skill levels, Philippine employment authorities are keeping a close eye on lower-skilled migration in particular as a programme of 'Saudization' takes place. Various news outlets have bandied about massive figures on how much Saudi powers-that-be are spending to buy off dissent and discontent; some say this amounts to up to $130 billion. But, aside from that massive sum, how do you create a more sustainable way of dealing with pent-up demand for domestic employment? Answer: you finally deliver on promises to hire fewer foreigners and more nationals. From the Philippine Star:

The implementation of the new hiring policy in Saudi Arabia, also known as the “Saudization” program, may displace 90,000 low-skilled workers, the Department of Labor and Employment said yesterday. Labor Secretary Rosalinda Baldoz said the Philippine government is assessing the impact of the new policy on Filipino workers employed by small establishments.

The Saudi Labor Ministry is classifying 300,000 local companies into four categories: excellent and green (complying companies), and yellow and red (non-complying companies). Local firms will be required to hire a minimum number of Saudi citizens. The categorization is expected to be completed on Aug. 30.

Baldoz assured Filipinos employed in Saudi that the government is prepared to act on the challenge of the new policy. She said the Philippine labor offices in the kingdom are educating Filipino workers on the impact of the program.

So they're even going to colour-code firms based on certain hiring criteria of Saudis--the exact formula is not exactly known. (There's also the assertion of Philippine central bankers that many of those heading to Saudi Arabia are now more highly-skilled to contend with.) However, one thing I will readily concede is that there is likely a sizeable number of young unemployed locals. Arab News offers this take on 'Saudization':

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.

It's not as if Saudization hasn't been tried before. Yet the aforementioned payments and wage hikes aside, the events currently engulfing the Gulf seems to have forced the Saudi authorities' hand in a more pronounced fashion:

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.

My question is simple and hearkens back to what I stated earlier: given that many of the jobs on offer will be to of the '3D' difficult, dangerous or dirty variety, what guarantee is there that Saudi nationals will readily fill these posts when foreigners will no longer be allowed to occupy them? For instance, the burgeoning number of university graduates is mentioned, but wouldn't they be seeking white-collar employment more than low-skilled work?

As they say, it's very much a work in progress.