Mofarrej Al Haqbani, Minister of Labour: Interview

Interview: Mofarrej Al Haqbani

To what extent have the measures put in place by the ministry alongside the private sector to encourage sustainable job growth been successful?

MOFARREJ AL HAQBANI: Despite the fact that many important initiatives are still in their early stages of implementation, there is clear evidence that measures taken by the ministry have already had a significant impact on key labour market indicators. Labour-force participation has increased from 51% to 55.7%, partly due to employment support programmes, such as Hafiz, which have benefitted more than 2.3m individuals since their launch in 2011. We believe that these initiatives will further help raise national labour participation as they mature and as the requirements for receiving state support are expanded. Nitaqat was another programme using quotas and incentives that has helped to bring 750,000 Saudis into the private sector in four years, a 100% increase. Female employment measures have supported the recent expansion in the number of nationals working in the private sector. The number of women employed by private firms has risen more than nine-fold, from fewer than 50,000 in 2009 to 450,000 in 2013.

What is being done to increase support for foreign workers employed in the Kingdom?

AL HAQBANI: It is the declared objective of the Ministry of Labour to “make Saudi Arabia one of the best working environments for guest workers, attracting high-quality labour to work here” and to “protect all employees irrespective of their nationalities”. The ministry has focused on new measures such as increasing mobility of foreign workers whereby employees of low-ranked firms can move to higher-ranked companies without seeking permission from their current employer. The ministry has also introduced a wage protection system where private sector workers, including foreign staff, are remunerated as per their contracts. A third focus has been the support of domestic workers. An example of this is the Domestic Labour Law introduced in 2013. This restricts working hours, guarantees time off, sick pay and worker accommodation, and regulates means of payment. Bilateral committees and agreements have also been established with source countries of domestic workers such as Indonesia, the Philippines and Sri Lanka to strengthen ties and better regulate employment. There is also an online portal that provides employment protection information.

How can vocational training help in boosting Saudiisation levels and what initiatives are under way?

AL HAQBANI: A stated ambition of the ministry is to raise the proportion of Saudis in the labour force. One reason for the current imbalance is the mismatch between the skills and experience of Saudi nationals and those required by the private sector. Increasing the number of students undertaking vocational training courses is an important step toward correcting the existing supply-demand skills gap. To this end, the Ministry of Labour is driving the expansion of technical education outside the university system with the goal of increasing the proportion of the technically educated labour force to 50%. This effort is being driven by our subsidiary, Technical and Vocational Training Corporation, through three main channels: industrial institutes, technical colleges and colleges of excellence, the newly established flagship scheme for Saudi students.

Industrial Institutes provide training packages to high school students based on national standards developed to meet the needs of the labour market in technical specialities, whereas the technical colleges offer school leavers a vocationally focused higher education alternative to university. The colleges of excellence model provide courses designed in consultation with private sector employers. This allows students to acquire high-level academic skills and more broad-based technical skills, a key element of which is combining classroom training with work placements. The first wave of vocational colleges of excellence run as public-private partnerships was launched in September 2013. Our aim is to provide up to 400,000 places over the next decade.

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Mofarrej Al Haqbani

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The Report

This article is from the Economy chapter of The Report: Saudi Arabia 2015. Explore other chapters from this report.