Saudi Arabia launches committee to tackle unemployment

Saudi Arabia’s cabinet has given the go ahead for a Commission for Job Generation and Anti-Unemployment, in a bid to combat rising unemployment among young people.

The commission was announced during a cabinet session this week chaired by King Salman bin Abdulaziz al-Saud.

Analysts told Al Arabiya News the new committee was a welcome step, as the country faced dropping oil prices and a youth unemployment rate of 29.43 percent among Saudis aged 15 and 25 as of 2013, according to International Labor Organization statistics.

“This is a good measure given that this will allow for a very comprehensive review from the very top level, and allow for necessary measures from the broader perspective on job creation,” Saudi-based John Sfakianakis, director of the Ashmore Group, told Al Arabiya News.

Two-thirds of the Saudi population of 29 million are under the age of 30.

Thirty-seven percent of all Saudis are 14-years-old or younger, according to a 2011 paper from the Woodrow Wilson International Center for Scholars in Washington, D.C.

This means nearly 1.9 million Saudi youths will join the job market in the next decade.

Public, private sectors

“The Saudi government has previously demonstrated an ability to propose and execute successful economic programs,” Omar al-Ubaydli, program director at the Derasat economic and political research center, told Al Arabiya News.

“In the case of unemployment, almost all advanced economies have significant government involvement in the process of helping people - especially youths - get jobs, and such measures have also yielded returns.”

Other analysts have said that while government help is always welcome, attention needs to be given to working with the private sector in order to establish sustainable growth.

“What is important right now for the government is to provide the right incentives for people to go into the private sector,” Sfakianakis said.

Sfakianakis added that the government needed to signal to Saudis that it “won’t be the first or last” in terms of employing its citizens in government and ministerial jobs.

Reforms

Chris Innes-Hopkins, director of the Saudi British Joint Business Council, said before any measures could be taken, the main requirement at the moment was “to widen the skills-based markets in the economy.”

This means “encouraging more nationals to take up more technical and vocational professional careers. The government can achieve this by providing more vocational qualifications, so they can open up more professions and sectors of their economy.”

Ubaydli said for any Gulf Arab country, not just Saudi Arabia, opinions regarding what some consider “unsociable” jobs needed to change.

“Educational outcomes need to be improved. There needs to be significant coordination between the government and the private sector to ensure that the educational system serves the needs of the private sector. That means giving scholarships to students in the fields where the economy needs workers.”

Such changes are slowly taking affect. Of the nearly $58 billion that the country allocated toward education, about $108 million will go toward general school rehabilitation projects, and $3 billion will go toward higher education, according to the U.S.-Saudi Arabian Business Council.