An evening with the minister of labor
He is the man of the hour. People are divided over his decisions; either with him, or against him, no middle ground. The Saudi Minister of Labor, Adel Fakieh’s latest decision stirred the market; I am not able to remember the last governmental decision that caused such uproar. However, I can definitely remember a man who walked down the same path, and provoked a similar controversy, his predecessor, the late Ghazi Al Gosaibi.
The hot topic these days is the decision to increase the annual fees paid on every foreign worker. Once announced, all hell broke loose; meetings everywhere, governmental agencies reacting confusedly, and businessmen stomping their feet in anger and frustration, warning that they will be forced to close their businesses — all because of this one decision.
The ministry officials decided to wait for a few days, probably taken aback by the aggressiveness of people’s reactions, and that was a mistake. They should have been actively promoting the new law even before its announcement, and standing by it after its release. Following the better late than never mantra, they decided to adopt a new approach and to explain themselves by directly communicating with the public.
The ministry arranged two sessions in Riyadh and Jeddah, hosting a number of social media prominent tweeps, bloggers, writers, and businessmen to show them a presentation on their decision, explain it, and discuss it. The Minister himself stepped in and led at these meetings.
I attended the one in Jeddah. The presentation and discussions were fruitful and open. Those for the decision, or against it, both had the chance to voice their concerns and ask their questions. The presentation itself was solid, full of numbers, and it’s hard to argue with numbers. Many in the audience came in bearing doubts and prejudice, and I believe, came out with a better understanding of the decision, although not necessarily agreeing with it.
In contrast to many points of view, I liked the ambitious strategy. The ministry’s main objective is not to kick non-Saudi workers out of the country. On the contrary, it acknowledges their importance to this country’s economy.
There are 7 million non-Saudi workers making a living here, while there are 2 millions Saudis looking for a job. The math is simple. Now, having said that, we could say the ministry’s strategy is based on two main pillars: The first, to give Saudis, males and females, a fair chance to compete over available jobs in the market. The second is to fix and reform the dysfunctional labor market. The decision to increase the fees is only one of many decisions and initiatives the ministry is adapting to amend the stale labor market.
For a long time, Saudi businessmen have been in love with the idea of very cheap, mostly unskilled labor, so their profit margins would skyrocket. That unfortunately, caused an unorganized and unstandardized market, where low quality services and unprofessionalism were, and still are prevalent.
This lucrative practice has made it near impossible to many Saudis, even those with diplomas in technical skills, to compete with low paid, unskilled labor. Not only that, but this very practice allowed so many sectors in the market to be virtually controlled and run by those unskilled laborers. In many cases, they are willing to go to the extreme to protect their jobs and territories.
Therefore, increasing the fees on very low-cost labor would create a minimum level of wages and benefits that should attract Saudis. Not only this, but it should also improve the working conditions for the skilled non-Saudi laborers as well. The envisioned market, thereafter, is a more organized one that is producing professional and high quality services.
But what about Saudis and menial jobs? “Saudis will never settle for such jobs” the famous argument goes. The Minister has some interesting views on this.
We tend to think of these menial jobs in their current statuses and conditions, but with the Minister’s advice, active change and creativity, new business models will make these jobs more attractive to Saudis and more efficient. This is quite daring and ambitious of the Minister. Having businessmen and investors change their practices is painful, takes time, and usually meets with resistance.
The Minister believes that this is the bitter taste that comes with the medicine; we need it to wake up and to create a better market. I find myself agreeing with the Minister on this; I do not think Saudis would refuse to work as plumbers, carpenters, construction workers, etc., once these jobs are presented in a professional manner, in organizations with competitive benefits. This is not a dream; this is what is happening in the more advance economies.
However, the road is rough and bumpy. Dreams need work, and work demands you to be realistic. Building up a strong economy and creating an efficient labor market cannot be assigned to one ministry or one agency.
It is a collective work and a strategy for the whole nation. There are many challenges in education, in work culture, in governmental processes, and even in the norms and practices of Saudi society. It is all about change, and change is painful in the beginning, but fruitful at the end, if carried out correctly.
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