A 2014 paper in the academic journal Sleep Medicine found that Saudi adolescents went to bed later than their peers in other countries, and that they were predisposed to reverse sleep cycles, whereby they stay up all night and sleep during the day.
The decision to allow for 24/7 shopping may be an attempt to capitalize upon the nocturnal idiosyncrasies of Saudi youth in the battle to create jobs.
From this year, Saudi businesses will be allowed to keep operating throughout the night, a right that was previously restricted to a narrow range of businesses, such as medical clinics and petrol stations. The government will also introduce rules to ensure that employees are not forced to work extra hours.
This last clause, which nominally aims to protect the interests of workers, reflects the job-creating aspect of this policy. Many countries in Europe have struggled with high unemployment, especially in the youth segment, for decades, and this has propelled some, most notably France, to introduce “job-sharing” schemes. These are restrictions on the number of hours that an employee can work, with the goal of forcing companies to hire a larger total number of workers.
The theory underlying job-sharing schemes as an antidote to youth unemployment is that the young often fall into unemployment-inexperience traps: They can’t get a job due to lack of work experience, and they lack work experience due to their unemployment. The goal is to break this deadlock by making it easier for the young to get a job, initiating a virtuous cycle.
In general, job-sharing schemes have been unsuccessful, because from the employer’s perspective, two different people working 25 hours a week is far less productive than one person working for 50 hours a week. Thus, employers either exploit loopholes that allow them to circumvent the rules, or they simply scale back operations.
The Saudi case is different, however, because unlike France and many European countries, where citizens are watching TV and getting ready for bed by 8pm, Saudis like to stay up late, especially the young. Prayer times play an important role in this tendency: shops have to close during prayer times, for around 40 minutes, meaning that shopping during the afternoon and early evening is interrupted regularly, making shopping after isha prayer relatively convenient. Also, Saudis have a higher tendency than most Muslims to perform the dawn prayer at the designated time, which can be around 4am depending on the time of year; and so staying up through the night and praying and then sleeping is easier for some than waking up for the prayer.
Consequently, compared to countries like France, there is a much stronger organic demand for people to be working around the clock, and the labor supply exists. In principle, the only impediment was artificial restrictions on when businesses could operate—a restriction that has now been lifted. Within a few years, we should expect to see a significant number of young Saudis working night shifts in these establishments, helping bring down Saudi Arabia’s youth unemployment levels.
Additional factors likely contributed to the decision. Among them is the global phenomenon of millennials demanding services at all times, beyond the propensity of Saudi millennials to burn the midnight oil. In this sense, the Saudi government is trying to keep up with changes in society and enabling the economy to cater to youth demands—recall that Saudi Arabia has a much higher representation of youth in the population than OECD economies. Local startups, such as food delivery company HungerStation, will view the new rules as commercially supportive, and the Saudi government will be hoping that young Saudis will develop other innovative enterprises that take advantage of the new commercial opportunities.
On a similar note, the government is trying to transform Saudi Arabia from a culturally isolated and inwardly looking country, to a dynamic metropolis that attracts top global talent and investments. All of the world’s cultural and financial capitals are cities that never sleep, and Saudi Arabia wants its major cities to be part of that club.
In isolation, a policy of allowing 24/7 commercial operations would have barely any effect on life or business in the Kingdom. However, as part of a series of sweeping reforms, and with many more still to come, the Saudi Arabia in 2030 is likely to be unrecognizable from the one that started the millennium.