Saudi Arabia Country Research for YCI Feasibility

Transcription

1 Saudi Arabia Country Research for YCI Feasibility Demographically, Saudi Arabia presents an excellent environment for conducting a YCI programme. Employment in the private sector has been a particular issue because of the traditional view that public sector work is more respectable and secure. This has been compounded by the private sector s tendency to employ cheaper labour from outside the country. i Poverty levels are estimated to be a quarter of the population, although another source suggested that between 2 and 4 million Saudis live below the poverty line. ii Many rely on the Islamic system of Zakat- a religious requirement whereby individuals and corporations must donate 2.5% of their wealth to charity, administered by the government. iii In 2013, a twitter campaign was led by online Saudi communities highlighting how private sector employment is poorly paid- compared to public sector jobs and other countries in the Gulf Cooperation council. 1 Key Stats Population million GNI per capita $26, 340 Youth population 7.6 million (26%) Youth unemployment 29% of School year starts any time from end of August to the end of September and finishes between the middle and end of June Saudi Youth A large proportion of Saudi national youth are wealthy, despite technically being unemployed. Therefore targeting the correct beneficiaries will present some difficulties. Many of the government policies for youth unemployment target this higher social strata, perpetuating wealth inequalities rather than focussing on those most in need. This is where YCI could provide a vital source of empowerment and a mechanism for social mobility. However, with the potential to partner with the government on some of the following programmes, there may be a struggle in targeting those in need rather than the wealthy unemployed youth. Education is free at all levels- elementary, intermediate and secondary. Islam forms a large part of the curriculum. At the secondary level students can either follow a religious or technical path. Gender segregation in the classroom is compulsory. Recent policy and programme responses to employment issues (see appendix A): Inequality Nitaqat- businesses are now required to meet quota of Saudi workers iv. This has been called Saudisation and has had mixed affects. This initially affected the hotel industry very badly because of the quality of Saudi hospitality talent and their reluctance to explore this sector. Due to the change in perception, YCI would be a perfect scheme for helping hotels to achieve an excellent or green classification. v Hafiz- social protection scheme providing unemployment assistance, seen as a financial incentive to find work and learn new skills for people aged (See appendix B). The Abha Chamber of Commerce offer employment programmes directing young people/ graduate to private sector employment, but stated that in 2014 there were more jobs than applications. This could mean that there is something preventing those who are living in difficult situations in accessing this. Technical and vocational training institutions such as colleges of Excellence exist and providing apprenticeships (see appendix C). Daily living crisis due to rent and subsistence needs are high and exacerbated by the traditional nature of an extended family, often meaning that many people are reliant on one employee. Having rejected the presence of poverty for some time, the prevalence of non-profits working on poverty alleviation is low. US department of State has identified Saudi Arabia as a destination country for men and women subjected to forced labour, however due to the Nitaqat, it would be questionable whether focusing on Saudi national would elicit a better response from authorities and potential partners. Urban slums in Saudi Arabia, such as Karantina in Jeddah, are largely occupied by illegal immigrants. There are 70,000 1 Saudi employees in the private sector are paid an average of 6,400 Saudi riyals ($1,706) per month, compared with SR15,200 ($4,053) for nationals and SR23,600 ($6,293) for European private-sector employees in other Gulf states, the study showed. 1

2 stateless persons in Saudi Arabia (UNHCR). Due to the nature of Saudi social welfare and charitable manners, these groups of people experience little help. However, it is questionable whether YCI could receive the necessary institutional support and acceptance to run a programme here with this target group. Other minor cities have high levels of poverty and still some ITP presence. See appendix D for more information for future growth into these high impact areas. Hotel Industry Of the 670,000 staff employed by the Saudi tourism industry in 2011, only 26% were Saudi nationals. Suggested that foreign management tend to hire from their home countries. Study recommended that a Saudi management presence in the industry would aid Saudi career aspirations (Aldosari, 2013). Travel and tourism directly contributes 1.7% of total GDP and directly supported 1.8% of total employment. By 2024, it is expected to contribute 1.8% of GDP and 2.0% of employment (World Travel and Tourism Council, 2014). Accor have run a programme in 2013 entitled Saudi Management training program in an effort to get Saudi nationals to join the hospitality industry. 15 month curriculum, covering a full academic term combining practical training, awarded an official Accor Diploma after exams that allows the graduates to apply for positions within the hotel group. Supported by the Saudi Commission for Tourism and Antiquities. Accor have their own academy which they run training programs from. vi Further information about accreditation must be obtained. This year Accor will be running a female only cohort- suggesting that if YCI were to run a programme the pilot may also have to be just male to lay the foundations for societal acceptance. Non-profit presence and compliance As suggested, there appears to be a lack of non-profits working on youth unemployment or reducing poverty, largely due to foreign organisations being prohibited from opening branches in Saudi Arabia. Non-governmental organisations are restricted to a narrow range of permissible activities, which are closely monitored by the government. Advocacy organisations are prohibited and approval from the Ministry is necessary before communicating with regional and international peer groups. The receipt of foreign funding is prevented in practice (although there is no legal barrier currently). vii The King Khalid Foundation, in collaboration with IYF have begun the Saudi Youth@Work alliance in order to build capacity within Saudi non-profits to offer workforce development programmes, also providing grants and technical support for this. The Passport to success scheme also operates in Saudi, and IYF state that they will continue expanding their alliance including Hilton. As Hilton has identified Saudi Arabia as a priority market, there certainly is the potential for building partnerships with these organisations, and thus operating the programme within a strong supportive network. The Global Partnership for Youth Employment and Employability (GPYE) also work with the following implementing partners; Arab Urban Development Institute, Understanding Children s Work and the Youth Employment Network. A study conducted by GPYE stated that YSIs (Youth Serving Institutions) do not face funding challenges in Saudi Arabia. Cultural challenges for YCI The hotel industry and the jobs associated with this largely fall within the culture of shame that purveys Saudi youth s aspirations. In order to ensure the relevance of a programme to the target groups, there should be an indication of the potential for high achievement, such as progression to managerial roles. However, alongside Hilton and Accor, YCI could help increase engagement of Saudi youth in the private sector, having a long term impact on youth unemployment in the country. Based on this information it is difficult to distinguish whether Saudi represents an opportunity for 2016 or Although it presents a good opportunity, it can be suggested that engaging with partners and negotiating regulations and sourcing beneficiaries could be a lengthy process in this context. 2

3 References Khalid Abdullah Aldosari 2013 Saudisation in the Hospitality Industry: Management Issues and Opportunities, Doctor of Business Administration, Victoria University. World Travel and Tourism Council 2014 Travel and Tourism Economic Impact 2014 Saudi Arabia. The Global Youth Wellbeing Index 2014, Saudi Arabia. IMF 2013, Saudi Arabia: Selected Issues. OECD 2014, Promoting better labour market outcomes for youth. Global Partnership for Youth Employment 2014, Charting the course: Strengthening the Impact of Youth-Serving Institutions in the Middle East and North Africa. ILO 2013, Global Employment Trends for Youth Appendices Appendix A- OECD, Promoting better labour market outcomes for youth, August

4 Appendix B G20 Employment Plan 2014 Saudi Arabia Unemployment Assistance (Hafiz): The first unemployment Assistance program (Hafiz 1) was launched in November 2011 to help jobless Saudis between the age of 20 and 35, aligning with the significant challenge of youth unemployment. The program pays each participant a monthly financial assistance of SAR 2,000 for a period up to 12 months, conditional on participating in training and demonstrating a seriousness in looking for work. The second unemployment assistance (Hafiz 2, February 2014) followed the success of Hafiz for year olds and provides a similar level of financial assistance to job seekers aged Another program under the Hafiz umbrella aims at up-skilling job seekers and increasing their chances for employment. A further financial incentive encourages job seekers to move faster to sustainable employment. This incentive is paid to individuals either as a cash amount equal to their remaining financial benefit under the Hafiz program for securing a job early, or offers individuals a training voucher worth more than cash option. Project parallel Project parallel is an employment readiness program for young Saudis. It is designed to provide online pre-tests, e-learning modules and e-coaching during work experience/on-thejob trainings. The main program parts are general employability skills and specialized skills for different types of jobs. A career readiness certificate is issued by the program which gives employers the confidence that the respective person is employable and brings the right skills. The program will be launched and implemented in the first phase in September 2014, and subsequently be enhanced. KPIs will include the quality, effectiveness and size of the program. This is a new action since the St. Petersburg Summit. Job Placement Centers Job Placement Centers (JPCs) provide job seekers with evaluation, training and communication skills, and link them with suitable job opportunities. A program has been launched to create an alliance between JPCs and the Ministry of Labor's vocational training schemes. The focus of the program is to train vocational training staff to provide career guidance support to vocational training students. Appendix C G20 Employment Plan 2014 Saudi Arabia Technical and Vocational Training With the increased attention and demand throughout the kingdom of Saudi Arabia for greater human resources and participation in technical and vocational areas, a key priority of the Ministry of Labor has been increasing the capacity of the institutions run by the Technical and Vocational Training Corporation. A focus here has been the introduction of Colleges of Excellence, as well as the expansion of Short Courses that are available to all job seekers, especially women: Colleges of Excellence Colleges of Excellence (CoE) provide tertiary courses designed in consultation with private sector employees which combine classroom training with placements in the workplace. The mix of skills and workplace experience makes CoE graduates attractive prospective employees. The commitment is to establish 50 technical training institutes over the next 10 years, which are incentivized based on the number of college graduates that successfully move directly into employment. The first wave of CoE, with 5 world-class international training providers operating 10 new colleges, was launched in September Eight more providers will join the program in September 2014, raising the number of colleges to 37. 4

5 Short vocational training courses The Ministry of Labor has established a series of "Short Courses" to support job seekers. These courses are designed to address skills gaps, a key obstacle to employment, by training high school dropouts and re-training and up-skilling adults who hold other educational qualifications. Whilst the courses are open to males and females, they are particularly attractive to female given their shorter and more flexible duration than more traditional vocational courses. The duration varies from a few hours to 1 year and focus on a wide range of different subjects, such as work readiness, basic IT, and technical and vocational skills which are in demand by employers. Apprenticeships Apprenticeship programs are an increasingly important element in the transition from education to employment. Saudi Arabia currently operates two programs: On the Job Training On-the-job training for youths and other new employees in the private sector occurs in the workplace under a contract between the employer and trainee. Instruction is provided by a professional trainer or experienced employee. After completion of the pilot, full scale roll out should begin in Joint Training Program Joint training programs last from two month to two years, with trainees spending 75 per cent of the time in the workplace and the rest in class or theoretical training. Appendix D Jazan is the poorest city in Saudi Arabia. It is situated in the south of the country and the number of families suffering from extreme poverty amounts to 19,700. According to the antipoverty national strategy the percentage of families living under poverty line in Jazan is 34%. There are 3 ITP hotel member properties in this city. Najranin (2 Holiday Inns) in southern Saudi Arabia is the second poorest area with 24.53% of its families living under poverty line, followed by Al-Madinah (6+ hotels), situated in the west, with 24.07%, and the area situated at the northern border with 23%. 2 i G20, 2014 ii ii iii iv v vi vii 2 Read more: 5