More effort is needed to find jobs for a forthcoming “youth bulge” into the workforce, according to a new report.
Speaking at the launch of the Mena Talent Competitiveness Index, produced by the Centre for Economic Growth, Insead Business School and Google, Insead’s global indices director, Bruno Lanvin, said that the size of the region’s young population – 60 per cent are under 25 – is “an asset for the region and a huge gap in terms of employment”.
The report highlighted the levels of economic inactivity that are already present in the region, with 44.3 per cent of the population in non-GCC markets outside of the labour market.
Within the GCC, this figure rises to 64 per cent, which it said was due in part to the low participation rate among women, as well as inadequate skills.
It said that there were wider challenges stemming from unequal access to opportunities, and from “misaligned incentives” keeping people out of the private sector workforce. The non-oil private sector remains relatively small and underdeveloped, the report said, with companies often dependent on public sector investment to drive growth.
“What is missing is moving away from an entitlement mentality, which makes it a tradition to look for jobs in the public sector,” said Mr Lanvin. “Jobs in the public sector should be encouraged, they should be attractive. But it should not be to the detriment of private sector initiatives.”
The UAE was ranked as the region’s best-performing economy for talent and was the only regional country to feature in the top 20 of the Global Competitiveness Index produced at the World Economic Forum’s Davos event in January this year.
Qatar was ranked second in the region (and 21st globally), followed by Saudi Arabia (42nd), Bahrain (47th), Kuwait (57th) and Jordan (58th).
The index assessed a group of factors to generate the ranking, such as the policies and practices in place to attract talent and the enabling environment that allows a country to attract, develop and employ people.
“Cities like Dubai are making a name as tech start-up hubs,” Mr Lanvin said. “The country’s ambitious innovation strategy should benefit from such ability to attract and retain top talent.”
Patricia McCall, the executive director for the Abu Dhabi-based Centre for Economic Growth, said that she believed there was already momentum building in terms of moving people towards private sector employment.
“If you look at GCC budgets, they’re not going to be able to sustain a huge public sector workforce for the next 10 years, so we’ve already started to see some freezes in Saudi in terms of public sector salaries.
“But it’s still about 70 per cent more pay in the public sector versus the private sector and there needs to be this discussion between the public and private sector about how to bring that equilibrium down,” she said.
Selim Eddé, Google’s Mena head of policy and government relations, said the answer lies partly in technology.
“The classic answer would be to make it less attractive to work in the public sector but what if we were to try something different? If you provide massive broadband to everyone, the youth will astonish you what they can do,” he said.
“We know that we have YouTube creators that left their day job for doing full-time YouTube creation. This is a brave new world with brand new opportunities, and man and woman are competing equally.”
He pointed to the example of Careem, the ride-hailing service that, he said, had created about 250,000 jobs, including 70,000 in Saudi Arabia, many of whom are Saudi nationals.
mfahy@thenational.ae
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