Saudi Arabia Expels 800,000 Expats To Create Jobs — It’s Not Working

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“Employers say young Saudi men and women are lazy and are not interested in working and accuse Saudi youth of preferring to stay at home.”

Saudi Crown Prince Mohammed bin Salman may be trying to portray himself as a visionary tasked with rolling back the country’s stiflingly conservative restrictions, but when it comes to Saudi Arabia’s financial fortunes, he is floundering.

Hit hard by the collapse in oil price, the Gulf kingdom is now witnessing a decline in foreign investment and a high level of capital outflow as its de facto leader attempts to consolidate power. Bin Salman’s “Saudization” process attempts to wean the country off its dependence on oil and one part of it aims to make jobs for Saudi citizens by reducing its reliance on foreign workers.

 As of April, more than 800,000 expats have left the country since 2016. However, instead of increasing jobs, Saudi Arabia experienced its highest-ever unemployment rate among its citizens during the first quarter of 2018. The positions left vacated by departing expats are also not so easy to fill.

The majority of the foreigners in the country are from South Asian, South East Asian and Middle Eastern countries,  employed in low paying jobs. These jobs are now open for Saudi but it turns out, they are not interested in such demanding jobs.

But Saudi business owners are having difficulty getting locals, accustomed to undemanding work in the state sector and generous unemployment benefits, to work for them. Reports suggest many Saudis are put off by what they regard as poorly paid, low-status jobs.

"Employers say young Saudi men and women are lazy and are not interested in working and accuse Saudi youth of preferring to stay at home rather than to take a low-paying job that does not befit the social status of a Saudi job seeker," columnist Mohammad Bassnawi said, adding that fake Saudization "could create a generation of young men and women who are not interested in finding a job and who prefer to get paid for doing nothing."

Saudi officials also want to generate 450,000 openings for locals in private sector by 2020, however, that seems difficult considering the current state of affairs.

Nevertheless, it is unlikely the Saudi authority will turn back on “Saudization.” MBS hopes to generate some $17.33 billion through new expat taxes in 2020 in order to address the country’s budget deficit and to fund new economic projects. However, economists are cynical that the projected tax haul will balance out the loss of consumer spending that resulted in the outflow of expats, especially since it is expected those who still remain in Saudi Arabia will send their loved ones back home because of the new fees on dependents.

Banner / Thumbnail : Reuters

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