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Keywords
Employment, Public sector, Private sector, Development Regulations, Saudi Arabia
Abstract
The paper explores the conditions of employment and career development in Saudi Arabia, which are found to be strongly segmented across nationalities. It discusses the main factors shaping employment and career development in Saudi Arabia, including employment policy, education and training, labour regulations, and recent Saudisation policies aimed at reducing dependence on foreign labour by replacing non-Saudi employees with Saudi nationals. The large inflows of foreign labour, and their conditions of employment, made possible rapid economic development in Saudi Arabia, while protecting the incomes and status of the Saudi labour force. The implementation of Saudisation faces important constraints, especially in the private sector, but signals an important change in employment policy and career development.
Introduction
Compared to other economies, at a similar stage of economic and social development, the labour market and employment in Saudi Arabia exhibit some unique features. It relies, to an important extent, on foreign labour, roughly two-fifths of total employment, and its Saudi labour force is largely employed in the public sector, and is overwhelmingly male. The large share of foreign workers in the Saudi labour force is a consequence of its rapid economic development following the oil boom revenues of the 1970s. Saudi Arabia is a leading oil producing country, and the revenues from oil exports have provided the foundation for the accelerated development of its economy. In the 1970s and early 1980s, oil and gas contributed around one half of GDP and, together with related economic activities such as refining and construction, provided the driving force behind Saudi Arabia's economic development. Five-year development plans allocated the substantial public revenues resulting from export of oil to large-scale public and private projects. The rapid growth of the economy generated an equally rapid increase in employment. Employment trebled between 1970 and 1980, and has more than doubled between 1980 and 1995. The rising demand for labour was largely met by attracting foreign workers. In the 1990s, government concerns to increase participation of Saudi workers in the private sector and to reduce its reliance on foreign workers led to the adoption of policies aimed at substituting foreign for Saudi workers. These policies are known as Saudisation, and include...