The launch of the National Labour Market Plan 2021-23 represents the government’s decades-long effort to improve employment opportunities and conditions for workers in Bahrain. A plan detailing required policy amendments and the schedule of launch dates for strategic initiatives was inaugurated in 2004 to establish synergies between labour market and education development programmes. Both the Labour Market Regulatory Authority (LMRA) and the Labour Fund (Tamkeen) were established in 2006. The LMRA was formed to oversee and guide all regulatory issues and policy reforms relevant to the labour market, as well as the employment status of both Bahraini and expatriate workers. Tamkeen, meanwhile, was established as a semi-autonomous funding and training body focused on strengthening the private sector and labour market. Tamkeen’s initiatives are aligned with the government’s overarching development agendas, and the organisation is the key entity in implementing human capital development strategies within the kingdom.
Regulatory Authority
In 2012 the LMRA launched Law No. 36, which enhanced workers’ rights, protections and working conditions. The LMRA was restructured in 2019 before the launch of the National Labour Market Plan 2021-23. The new plan was formulated in collaboration with Tamkeen in a bid to boost the labour market following the Covid-19 pandemic. Key public and private institutions are collaborating to facilitate progress towards the goals of the plan.
The three core objectives of the plan include promoting job creation, strengthening the private sector in order to boost economic growth, and bolstering regulatory frameworks regarding access to employment and workers’ rights. Through the various initiatives relating to labour market expansion and reform, the government is aiming to create 20,000 local jobs and provide training for 10,000 Bahrainis per year by 2024.
Private Sector Expansion
According to Bahrain’s Social Insurance Organisation (SIO), private sector employees accounted for 92% of the kingdom’s 583,000-strong workforce in the first quarter of 2022 – a 1% increase over the fourth quarter of 2021. By the close of 2022 the total national workforce expanded to 614,624 individuals comprising 150,320 Bahrainis and 464,304 non-Bahrainis. The total private sector workforce amounted to 564,249 people. While the recent expansion of the workforce reflects the post-pandemic normalisation of economic activity, the endeavours of the government and its partner organisations under the banner of the National Labour Market Plan 2021-23 are also believed to have made a significant impact. “It is clear that a more comprehensive, structured and coherent approach is being taken towards addressing human capital-related issues and unleashing productivity, and that the relevant national strategies are afforded high priority by the government,” Jarmo Kotilaine, chief strategy and data analytics officer at Tamkeen, told OBG.
Indeed, given the fact that work towards labour market reform pre-dated both the pandemic and the launch of the National Labour Market Plan 2021-23, SIO data recorded between 2012 and 2019 reveals significant progress across several key metrics. In the third quarter of 2012 the total private sector workforce was 486,068 individuals, containing 83,092 Bahrainis. By the fourth quarter of 2019 the total workforce had grown to 620,713, and the private sector workforce had expanded by 18% to 574,074, with 96,333 Bahrainis – an increase of 16% in that respect. While neither the total workforce nor the private sector workforce had by the fourth quarter of 2022 equalled their 2019 size, the number of Bahrainis employed in the private sector was 4% higher than in 2019 at 99,945 workers.
Since Tamkeen’s launch, its various initiatives have provided funding and vocational support to over 118,000 individuals and 74,000 enterprises. In the 12 months leading up to February 2023 Tamkeen programmes resulted in over 10,000 Bahrainis entering employment and around 8500 more entering training programmes. In light of these successes, the sharper focus brought about by the new labour market plan should facilitate additional progress.
Increased Productivity
Improving productivity is not solely dependent on increasing the size of the workforce. Traditionally, Bahrain’s private sector workforce has been dominated by low-cost expatriate labour – a dynamic that the relevant bodies are working to address. A key target of the National Labour Market Plan 2021-23 is to establish Bahrainis as the employees of choice in the kingdom, with high-skilled expatriate talent complementing a foundation of domestic human capital and plugging gaps in the national labour market.
Another initiative funded by Tamkeen is the Skills Bahrain programme, through which a range of public and private entities involved in education, training and various other economic sectors collaborate to map the attributes and requirements of the labour market and to establish professional standards for entry into specific vocations. Career guidance and vocational training are being offered to Bahrainis, with a focus on establishing and developing skill sets tailored to the high-productivity sectors that the government has targeted to drive economic diversification and expansion (see Economy chapter).
Creativity & Innovation
Harnessing technological and creative capacities to drive productivity is another focus for Tamkeen and the government. According to the UN, as of January 2021 creative industries employed around 50m people worldwide and contributed around 6% to global GDP. Developing Bahrain’s creative industries could stimulate increased revenue, raise economic dynamism and facilitate the creation of employment opportunities. “The local entrepreneurial ecosystem is hindered by the relative lack of liquidity compared to regional markets. In addition, the opportunities to assist and promote local start-ups would increase with greater scalability across the region alongside the provision of more training programmes to enhance the expertise of entrepreneurs,” Bader Sater, CEO of Bahrain FinTech Bay, told OBG.
Tamkeen announced in February 2023 that it planned to increase its focus on creative individuals and businesses, and that it had entered into partnerships with entities such as Middle Eastern e-sports company D11 Gaming, Al Riwaq Art Space in Manama, and the Bahrain International Federation of Business and Professional Women. Those and other entities are set to operate as incubator and accelerator programmes for start-ups and entrepreneurs, enabling them to expand their businesses.
Education & Training
The National Labour Market Plan 2021-23 features a significant education-related component, and in March 2023 the Ministry of Education (MoE) announced the launch of its strategy for the 2023-26 period. The strategy focuses on tailoring the output of Bahrain’s education system to the needs of its labour market, and sees relevant entities committed to raising both the quality and performance of the country’s tertiary education system. Along with the MoE, the Supreme Council for the Development of Education and Training is key to formulating and implementing strategies and initiatives to that end.
In 2022 the LMRA and the Information & eGovernment Authority did a soft launch of their jointly created Employability Skills Portal (ESP) – a Tamkeen-funded project in progress since 2019 – for a trial period among some government entities. The ESP has clear synergies with the Skills Bahrain initiative, providing information for jobseekers, businesses, education and training institutions, and government entities as to the skills required by companies and the jobs available in Bahrain. The digital platform is intended to enable the government to more easily formulate education- and labour market-related policies, as well as reduce expenditure. It is set to also bring clarity and efficiency to the recruitment process for individuals and enterprises, facilitating smoother employment and business operations. In addition, 2022 saw the opening of a MENA Training Centre in Manama, which offers programmes in management, finance, big data, artificial intelligence and innovation.
New Regulations
A package of reforms relating to work permits and registration of expatriate workers in irregular employment was launched in December 2022. Under the new regulations, these workers will enjoy added protections, while processes relating to employment registration have been streamlined and digitised. LMRA representation is also now guaranteed in all employment disputes involving non-Bahrainis, while possession of a work permit now legally entitles expatriates to increased protections regarding workplace safety. Those measures build on the 2022 launch of the long-term Golden Visa, which was designed not just to attract international talent into priority sectors, but also to retain international employees that were already working in Bahrain, enhancing the kingdom’s business climate and improving its reputation as an attractive destination in which to live, work and invest.
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