IT HAS BEEN a year since the Ministry of Labor launched the “Hafiz” initiative based on a Royal Decree, which is an allowance for all those that are currently unemployed and searching for a job. So as a society, what have we gained out of this program? When it first started I was very skeptical and saw it as a very short-term solution that will give everyone breathing space.
However, there have been valuable outcomes that are indirectly affecting the community as a whole. Firstly, Hafiz gave us statistics: Before hand, we didn’t know the size of the unemployment problem in Saudi Arabia. Once Hafiz started we began to see applications from various cities, genders, educational backgrounds, and skill sets etc. Why is this valuable you might ask? Well, economies are based on supply and demand, when we know that we have 1.6 million men and women that are job seekers between the ages of 20-35 we can start identifying solutions tailored to this issue. The Ministry of Labor in my view took the right approach in tackling the problem at hand in putting together a strategy with systematic procedures that help adapt new laws in the workplace tailored to our cultural norms.
Since Hafiz was launched, employers were encouraged to raise salaries to attract Saudis due to the SR 2000 dole money the unemployed were receiving and thus the minimum salary being offered was raised to SR 3000.
Subsequently, the ministry brought out a new law which links the salary to the Saudization ratio scheme (Nitaqat) to create a competitive working environment and even encourage part time shifts in the workplace.
With growing concern that over 85 percent of those registered in Hafiz are women, laws have been modified to allow them equal participation in the workplace. The retail industry is slowly transforming to an all-Saudi women workforce.
The laws that mandatorily state that women must be in the front office of all lingerie and cosmetic stores will create in the region of 400,000 jobs for women in the next three years. I believe within time, women staff will dominate most malls and outlet stores.
To further encourage these steps, there are other great initiatives the government has taken. One such instance is that for every institute in the private sector that hires over 50 women in their workforce, a daycare center must be put in place.
The recent law which imposes a SR 200 fee per month for all expatriates working in companies that have lower than 50percent Saudization numbers is aimed at private entities where they should start focus more on investing into growing local talent especially since the skill set in Saudi is starting to increase with the various scholarship programs, new colleges being set up and the range of courses that universities are offering.
This will make our workforce very competitive and allow Saudis to start working in various jobs from handymen to graphic designers and nuclear engineers. I know the majority of those reading this piece are expatriates and see this as discouraging.
However, you must understand you are here because we lack your knowledge and expertise in the fields you work in, and it is essential that you pass them on to the local community, to help make Saudis into the leaders of tomorrow.
You must also know, one integral part of this law is that employers cannot force you as an employee to pay part of the fee directly or even indirectly, if they do, you must be reported to the ministry.
All of the above changes in our labor market has stemmed from Hafiz, the question is, what is coming next? Recent news has shown the Ministry launch a partnership with recruitment agencies in which the agencies work on creating opportunities for those registered in Hafiz, place them into the workplace and then mentor them for a period of nine months.
Another initiative to watch out for is people working from home. The ministry is looking at adapting a number of pilot projects with the private sector to test the success of women working from home in various jobs.
In my honest opinion, we all need to look at this from a wider perspective. These changes have already had an impact in our labor market within the past year. In my view, five years from now, Saudi Arabia will set the benchmark when it comes to employment solutions.