Generations A Differences and similarities across the Arab generations

Transcription

1 Generations A Differences and similarities across the Arab generations

2 Contacts About the authors Abu Dhabi Richard Shediac Senior Partner Dubai Jayant Bhargava Partner Richard Shediac is a senior partner with Strategy& and the leader of the firm s public sector practice in the Middle East. He primarily focuses on the development of sustainable publicsector strategies, restructuring initiatives, operations improvement, and organization development. He is also a member of the Strategy& board of directors. Ramez T. Shehadi was formerly a partner with Booz & Company. Jayant Bhargava is a partner with Strategy& in Dubai. He leads the firm s digital media and entertainment work in the Middle East, focusing on the convergence between media, telecoms, and technology. He serves both traditional media and digital media players on strategy, M&A, and operating model topics. He also actively supports sector development institutions in carving out media-sector strategies, policies, institutional frameworks, and privatesector participation models. Dr. Hatem Samman was formerly the director of the Ideation Center, Booz & Company s think tank in the Middle East. This report was originally published by Booz & Company in Dr. Mounira Jamjoom and Tatiana Shahir also contributed to this report. 2 Strategy&

3 Executive summary The Arab region has undergone significant changes in recent decades. These events do not affect all age groups uniformly instead, each new generation is shaped by the socioeconomic events that it experiences most directly. As a result, the different Arab generations are increasingly distinct, each with their own perceptions, needs, and priorities. As governments and business leaders seek to craft economic reforms and make their countries more competitive, they need to tailor policies that effectively meet the varying objectives of the different Arab generations. This starts by understanding the generations themselves their similarities and differences, and how they view the world. To this end, we surveyed nearly 3,000 Arabs in six countries to gauge their views on a number of critical topics. We divided the survey population into three groups: the Arab National Generation (ANG), defined as those ages 49 to 65; the Arab Regional Generation (ARG), those ages 36 to 48; and the Arab Digital Generation (ADG), those ages 15 to 35, who have been most affected by the globalization and digitization trends of the past decade. On certain topics, the views of these three groups are closely aligned, such as their cultural values. In other ways, such as working styles and their use of technology, the three generations are quite distinct. For governments, the policy imperatives are clear: Education reform is critical, followed by labor-force planning, improvements to the delivery of government services, and a better use of technology (such as e-government offerings and integration of smart devices into daily interactions). The private sector must also understand generational differences particularly the different working styles and skills of younger and older employees and seek to capitalize on their complementary skills and attributes, and should aim to exploit widespread social networking adoption to make changes to advertising and to stimulate e-commerce. Strategy& 3

4 Age matters: Different generations, different perspectives The Middle East is at an inflection point in its history, as the enthusiasm of the Arab Spring evolves into very real questions about the region s future. The Economist Intelligence Unit in 2011 published an insightful yet grim outlook for the region. The study forecasted a 60 percent probability of a gridlocked political environment, which is likely to stifle the aspirations of the region s citizens. 1 To overcome this challenge, many countries across the region are pressing ahead with political, structural, and human capital reforms to achieve inclusive growth and create permanent jobs for the Middle East s growing youth population. Policymakers, business leaders, scholars, and interested citizens have sought to improve the effectiveness of these efforts by better understanding various demographic groups. Youth and women have certainly had the lion s share in demographic and trend analysis thus far, primarily because they face the most immediate and obvious challenges. For example, the youth unemployment rate in the region is about 25 percent, among the highest in the world. The situation is even more dire for young women, who face an unemployment rate of about 40 percent. Although youth- and women-focused labor market policies are crucial, they will not be enough to address long-term challenges and focusing exclusively on these two groups is short-sighted. Adult employment remains a significant issue as well. The duration of unemployment is shorter for youth than for adults. Indeed, the ratio of youth to adult unemployment is decreasing in part because the ratio of young to old is falling in the region s population, all of which underscores the need to approach the issue holistically (see Exhibit 1, page 5). The youth unemployment rate in the region is about 25 percent, among the highest in the world. More broadly, the Arab Spring offers a good opportunity to think about new development models that can promote sustainable economic growth, global competitiveness, and development. In previous reports, we have has analyzed key groups within the region, as defined by economic and sociological factors, including the middle class, youth, and the Arab Digital Generation. 2 In this report, we focus specifically on age, to better understand the key generations within the Arab region. More specifically, we argue that the generations have very different 4 Strategy&

5 perceptions thanks to the historical events that have shaped them. As a result, members of a generation tend to share common beliefs and behaviors, including basic attitudes about work, risk-taking, civic engagement, cultural values, and family life. Exhibit 1 The youth population is set to fall Ratio of Youth to Adult Population (%, Projected to 2050) World (not including Middle East & North Africa) Middle East (not including GCC) GCC North Africa Note: North Africa projection only runs to Source: Z. Tzannatos, Rethinking Economic Growth in the Arab Region (presented at the From the University Campus to the Labour Market session), Microsoft Regional Summit and Expert Group Meeting on Youth for Global Competitiveness, Dubai, May 18, 2013 Strategy& 5

6 This study also coincides with a time when the region s workforce is made up of a minimum of three generations. Our intent is to identify the bridges across generations and define new ones where they are missing. Although the region is witnessing a rise in the use of the term generation divide in public discourse, there is little research that clearly demarcates generations or explains generational trends. Beyond the media hype, there is a marked gap in the literature on generations. A generational perspective is therefore the missing variable. Regional governments and business leaders have not yet taken these generational differences into consideration when crafting social and economic policies. If they are to meet the needs of a broad range of groups, policymakers must understand the diverse perceptions and priorities of the region s generations. As Arab region leaders formulate social and economic reforms to promote sustainable and inclusive growth, and make the region more competitive within the global economy, they must develop policies that accommodate and leverage the unique characteristics of different demographic groups. Before they can begin to tailor their policies in this fashion, they must understand the differences between the Arab region s generations. There are a number of reasons why age demographics are a compelling issue for development: Changing Demographics: Regardless of the level of economic development or national income, Arab region governments are increasingly challenged to provide the basic needs and improve standards of living for a growing numbers of citizens: adequate housing, sanitation, healthcare, education, and jobs. The region s economic dependency the ratio of economically inactive to economically active populations is among the highest in the world, and that problem will likely worsen. Irrespective of the actual percentage, the sheer volume of economically inactive citizens will create a strain that regional governments will need to be equipped to handle. For example, the elderly population of Egypt (60 years and older) is expected to grow from 6 percent of the population at the start of this century to 21 percent in 2050, and Saudi Arabia s elderly population is expected to grow from 5 percent to 13 percent of the population during the same period. 3 Sociopolitical Imperative: The cultural values that have defined the Arab region are slowly changing; they have been complemented by a gradual rise in individualism, mostly led by the younger generation promoting the right to pursue one s goals, to be more self-expressive, and to value independence and self-reliance. The decline in communal values is also a reflection that in many countries the younger generations are facing hardships, with high unemployment rates among youth. 6 Strategy&

7 A Multigenerational Workforce: The region s future private-sector workforce will likely have a multigenerational feel. A generational lens allows employers to prepare for an increasingly age-diverse workforce, by identifying promising practices in recruiting, hiring, retaining, and accommodating a multigenerational workforce. Such a prospect also allows governments to promote future jobs and industries that attract younger generations. This is not only a challenge for the Arab region. In many parts of the developed world, policymakers and academics devote significant time and attention to understanding different generations and how they perceive the world and their place in it. In part, this is because their economic challenges are rooted in demographics. For example, Japan is currently struggling with an aging population, which threatens the country s economic expansion because of the shrinking working population. In the U.S., many companies are taking active steps to recruit and retain the so-called millennials (i.e., younger people just leaving university and entering the workforce), 4 who have grown up with technology and have significantly different working styles and preferences than older generations. In the U.K., a recent study analyzed 17 years of polling data, crossing four generations, which showed striking gaps among the groups regarding government priorities, the correct degree of social spending, and other aspects of society and social policy. 5 Our research defines generations based on key socioeconomic trends that either shaped the times when a particular age cohort was born or occurred at various points in their lives. Thus, a generational cohort shares an age location in history whether or not they were influenced by these particular events. To understand the generational differences within the Arab region, we have taken the 15-year-old to 65-year-old working-age population and divided it into three age cohorts: Arab National Generation (ANG) This demographic cohort was born between 1948 and 1964 (ages 49 to 65). The key socioeconomic event that shaped this era was the rise of Pan Arabism, which was built on the idea of a united Arab nation bound together by common linguistic, cultural, and historical heritage. It was also a time when governments emerged as key economic agents. Regional governments and business leaders have not yet taken these generational differences into consideration when crafting social and economic policies. Arab Regional Generation (ARG) Born between 1965 and 1977 (ages 36 to 48), this group grew up during the expansion of oil wealth in some countries, especially in the 1970s and 1980s, leading to the distribution of wealth across the Arab region and the rise of regional economic blocs such as the Gulf Cooperation Council (GCC), 6 which was established in Strategy& 7

8 The Arab Digital Generation (ADG) Born from 1978 onward (though our research includes only those ages 15 to 35), this age cohort experienced the onset of digital technology, along with economic globalization. To understand the differences and commonalities among these generations, we commissioned focus groups and an online survey of nearly 3,000 participants in six Arab region countries: Egypt, Jordan, Kuwait, Qatar, Saudi Arabia, and the United Arab Emirates (UAE). (For more details about the study, see Survey Methodology, page 9). Additionally, supplementary data from 649 respondents was collected in five other countries: Algeria (170), Lebanon (148), Libya (73), Morocco (163), and Syria (95). In some areas such as values, political views, and citizenship the survey responses from different generations are aligned on several topics. However, in others such as technology and work the differences are stark. We grouped the results into four broad categories, which are each discussed in subsequent sections: values and generational characteristics; national outlook, civic engagement, and citizenship; the world of work; and technology, media, and consumerism. Exhibit 2 Six dimensions were used to study the Arab generations Dimensions Framework Demographic characteristics Profile Politics Employment Core values Technology & commerce Development challenges - Personality and value characteristics, education, income, employment - Family relations, satisfaction with life achievements - Local, regional, and world outlook - Entitlements and their effectiveness - Satisfaction in the workplace - Gender and the workplace - Conservatism and traditionalism among generations - Concerns about the erosion of core values - Technology use and frequency, Internet access, online purchases, and obstacles - Socioeconomic challenges and challenges to development Countries Regions Gender Age Source: Strategy& 8 Strategy&

9 Survey methodology We commissioned YouGov, a research and polling firm, to conduct the Arab Generational Divide survey, which consisted of both quantitative and qualitative components. During the qualitative component, YouGov conducted eight mini-focus groups and three paired in-depth interviews in Egypt and Saudi Arabia. The mini-focus groups consisted of four respondents, and the paired, in-depth interviews consisted of two friend respondents. This phase provided fundamental information regarding attitudes, behavior, and perceptions, which helped shape the quantitative questionnaire (see Exhibit 2, page 8). For the main quantitative phase of the research, YouGov conducted both online and face-to-face interviews, generating 2,786 responses from participants in six Arab countries: Egypt (784), Jordan (450), Kuwait (256), Qatar (262), Saudi Arabia (703), and the United Arab Emirates (331). Supplementary data from 649 respondents was collected in five additional countries: Algeria (170), Lebanon (148), Libya (73), Morocco (163), and Syria (95). This supplementary data was not included in the analysis of the six main countries due to the insignificant number of respondents in each country. However, we highlight the findings from the supplementary data when relevant. Face-to-face interviews were used in countries where it was difficult to reach a sufficient number of respondents online primarily the UAE, Qatar, and Kuwait. In each country, YouGov ensured that only nationals answered the survey, and that all three generations ANG, ARG, and ADG were equally represented in the results. The weighted sample split by gender ensures equal representation of genders: 1,393 women and 1,393 men. This study uses generations as the main variable for analysis. We cited the differences among countries where relevant. Throughout this report, net scores show results in a single figure, enabling us to quickly summarize results and compare them across generations. Strategy& 9

10 Values and generational characteristics In general, the results show that all three Arab generations are more united than divided in their core values. For example, all three groups identify hospitality, generosity, and dignity as core values that they associate with the Arab population as a whole and for their own generation (see Exhibit 3, page 11). This is a notable finding, in that values are an important form of social cohesion. Yet while generosity and hospitality are shared values across all three generations, they seem to be declining over time possibly a reflection that in many countries the ADG is facing hardships with high unemployment among youth, a high cost of living, and reduced economic opportunities. In a more competitive economic environment and times of political unrest, it is possible that these people have more pressing concerns than being generous or hospitable. Indeed, when asked about their level of satisfaction with life achievements thus far, including career and education, the least satisfied were members of the ADG, particularly in Egypt, Jordan, and Saudi Arabia. By contrast, satisfaction levels were highest among the ANG, especially in the GCC (see Exhibit 4, page 12). Many young people do not believe in the quality of their education. This is in line with earlier research, showing that young people in the region are more concerned with socioeconomic factors than valuesbased issues. Unemployment levels for young Arabs are high above 25 percent in many countries. Many young people do not believe in the quality of their education, and housing is disproportionately expensive compared to other regions, effectively restricting them to living with their parents until they are older. 7 Indeed, demographic data from this survey shows that nearly two-thirds of ADG respondents across all countries 62 percent for GCC respondents, and 58 percent for non- GCC respondents live with their parents in large households. 10 Strategy&

11 Exhibit 3 The ANG upholds common values of dignity, generosity, and hospitality more than other generations Top 10 Values Associated with Each Generation GCC Non-GCC ADG 32% 29% 29% 29% 22% 21% 20% 21% 20% 16% 36% 23% 23% 20% 23% 21% 20% 15% 19% 10% ARG 35% 29% 31% 30% 27% 25% 23% 16% 17% 18% 39% 25% 23% 31% 17% 25% 14% 18% 20% 22% ANG 41% 36% 40% 40% 25% 29% 24% 22% 19% 18% 41% 32% 34% 33% 26% 25% 26% 19% 17% 17% Dignity Generosity Hospitality Affection Honesty Commitment Achievement Creativity Adventure Religiousness Survey Question: Up to five words you would strongly associate w ith your generation of Arabs. Source: Strategy& Arab Generational Divide Survey Strategy& 11

12 Exhibit 4 Satisfaction with life achievements is least in Egypt, Jordan, and Saudi Arabia Satisfaction with Life Achievements Egypt Jordan Kuwait Qatar Saudi Arabia UAE Very dissatisfied 6% 7% 4% 9% 5% 4% 1% 1% 0% 1% 1% 8% 14% 6% 2% 4% 1% 0% Somewhat dissatisfied 22% 17% 11% 21% 13% 10% 0% 4% 0% 10% 11% 9% 20% 16% 4% 6% 4% 0% Neutral 23% 21% 13% 13% 13% 14% 14% 5% 6% 27% 22% 17% 17% 13% 16% 8% 10% 2% Somewhat satisfied 37% 39% 41% 39% 50% 51% 40% 45% 49% 35% 33% 25% 33% 40% 45% 24% 20% 26% Very satisfied 13% 16% 31% 18% 19% 20% 45% 46% 45% 27% 33% 40% 15% 25% 32% 58% 65% 72% ADG ARG ANG Survey Question: In general how satisfied are you with what you have achieved in life (career/work/ education)? Source: Strategy& Arab Generational Divide Survey 12 Strategy&

13 Given that different economic conditions prevail in the various countries covered in this study, we tried to assess how these generations perceived their households financial situation. Overall, a significant majority in UAE and Kuwait appear to live a comfortable lifestyle. However, one in three respondents in Saudi Arabia, mostly driven by the younger generation, says that they manage on their present income. In Egypt and Jordan, a majority does not appear to be comfortable with its household s financial situation, and about 50 percent in both countries claim they are just getting by on their present income. In the supplementary country responses, the findings were similar to the situation in Egypt, Jordan, and Saudi Arabia. At least 30 percent of the ADG in these countries were finding it difficult to make ends meet, and 42 percent claimed to be just getting by on present income (see Exhibit 5, page 14). It is notable that in Qatar, a country with the highest per capita income in the world, about 32 percent of respondents claim to be getting by on present income. One explanation of these findings could be that expenses tend to catch up with, or exceed, income. When asked about values that they do not associate with their generation, all three groups cited individuality (mentioned by nearly a third of all respondents). This could be because of the region s predominant emphasis on family and community and the negative connotation sometimes associated with individuality. For example, a recent United Nations Development Programme survey of Kuwaiti youth found that parents are the most important source of support for youth, where 46 percent referred to the mother as a primary source of support, followed by 42 percent who identified the father. 8 Although the family remains the main identity reference for youth, our findings suggest that the ADG differ from other generations with regard to individuality. A smaller percentage said that the value was not associated with their generation indeed, it seems that Arab youth are redefining individuality through engaging in new forms of self-expression and civic engagement. In Egypt and Jordan, a majority does not appear to be comfortable with its household s financial situation. The slow rise of individuality also reflects changes in areas such as education. Increasingly, reforms are emphasizing concepts like individualized education and child-centered learning a marked difference over the highly standardized form of education that older residents received. These are new concepts that are affecting the ADG directly. Strategy& 13

14 Regarding differences, the ADG associates itself more with adventure and extravagance than the older two generations as youth typically do in other parts of the world. The ANG associates itself with achievement, possibly indicating that these people were more driven and ambitious in what they wanted to do, and have reached a point in life where they can look back on their accomplishments. These findings were similar in both the main study and the supplementary countries. Exhibit 5 Many are struggling with their economic circumstances 13% 36% 36% 9% Saudi Arabia 6% 10% 2% 4% 2% 8% 5% 100% 2% 12% 19% 17% 32% 67% Find it very difficult on present income Find it difficult on present income Getting by on present income Live comfortably on current income Live an affluent lifestyle 40% 56% 19% 20% 21% UAE Qatar Kuwait 52% 49% 32% 24% 2% Egypt Jordan 5% Survey Question: How would you describe your household s financial situation? Source: Strategy& Arab Generational Divide Survey Key priorities for policymakers and the private sector Policymakers and business leaders should shift their perceptions of young people and view them less as a problem and more as an asset. The changing demographics and social status of youth can, and should, be seen as an opportunity to engage their vast untapped potential. As is evident by recent events, young people can be powerful catalysts for development in the region. Capitalizing on this energy will require a greater emphasis on policy that highlights partnerships and collective action. There are several measures in this area that can bridge the gap between generations and build on common ties among them. First, Arab governments could consider developing national youth strategies that are built on a participatory and cooperative approach, involving the national government, the private sector, voluntary organizations, and international agencies. 14 Strategy&

15 Second, they should develop a young leaders program (similar to those in Qatar and Jordan), to identify and develop exceptional young people. Once those programs are functional, governments should integrate the young leaders into policymaking, through new processes that give them a greater voice, particularly in socioeconomic affairs. Creating more effective communication channels and processes will help policymakers understand the desires and priorities of the large and growing youth population. In some cases, this may require upgrading the processes at key ministries to ensure they communicate with young people using the means most conducive to eliciting responses: digital technology. Third, if they are to identify and address generational differences and areas of alignment, policymakers must start with a foundation of information. To that end, governments must collect, analyze, and present accurate demographic data and statistics, particularly those that show the interplay among generations. Tracking demographic change has important implications on several fronts for governments, such as fostering a more detailed understanding of labor markets, tax reforms, and immigration policy, among others. By the same token, understanding the differences among generations will unlock certain benefits for the private sector. For example, understanding Baby Boomers, Generation X, and Generation Y in the U.S. holds the key to smart 21st-century customer service leadership. Understanding and working with different age groups makes it possible to create a balanced, open, working environment, reduce costs, and create an engaged and motivated team that will ultimately offer the best possible service to your customers. This is what is taking place in countries like the U.S.9 Fourth, given that older generations hold much of the economic and political power in the region, governments should change the views of these generations regarding the ADG especially any misperceptions regarding their values. The GCC countries in particular are still largely influenced by traditional, conservative values. Although those values remain critical, they can overshadow the economic concerns that are pressing for younger people in the region. To a population whose members are struggling to find work, traditional values may begin to seem less relevant in addressing their financial requirements and helping them fulfill their true potential. If the region is to grow economically, older people must actively bring younger people into the fold, rather than criticizing their choices. For this to happen, older Arabs must develop a better understanding of the ADG and seek to capitalize on their strengths. One option for governments to influence the views of older Arabs is through a public-awareness campaign that emphasizes the priorities and potential contributions of younger Arabs. Other options include policies that can foster cross-generation communication for example, young people volunteering in charities to help the oldest generation which can help bridge the gap and help older people understand the economic imperatives that young people face. Strategy& 15

16 National outlook, civic engagement, and citizenship Regarding perceptions of their country and its place in the world, the results again indicate greater commonalities than differences. A positive sign is that Arabs are likely to believe their country is a leader in the Arab region in general terms. Considering more specific aspects, however, they are less likely to believe that their country leads in terms of technology or education (see Exhibit 6). This trend is more Exhibit 6 Angs and ADGS are divided on whether their countries are regional leaders Leader in the Arab World 6% 5% 3% 7% 6% 4% 20% 16% 12% 27% 26% 30% 38% 46% 49% Strongly disagree Somewhat disagree Neutral Somewhat agree Strongly agree Technologically Advanced 9% 9% 4% 15% 11% 7% 23% 19% 16% 26% 32% 39% 24% 26% 32% Strongly disagree Somewhat disagree Neutral Somewhat agree Strongly agree Educated and Intellectual 5% 6% 2% 10% 8% 5% 24% 21% 19% 36% 37% 38% 23% 26% 34% Strongly disagree Somewhat disagree Neutral Somewhat agree Strongly agree ADG ARG ANG Note: Percentages do not sum to 100 due to the removal of the minimal figures for those who did not know or could not say. Survey Question: To what extent do you agree with the following statements in relation to your country? Source: Strategy& Arab Generational Divide Survey 16 Strategy&

17 90% 81% 77% 77% 69% 74% 64% 55% pronounced for younger respondents members of the ADG were less likely to agree than ARG or ANG respondents that their country has a leadership position, perhaps reflecting their current diminished economic prospects. Among the issues facing their respective countries, respondents of all three generations identified the lack of transparency and unemployment as the central challenges, followed by insufficient healthcare, inadequate infrastructure, and poor quality of education. Although these results were consistent across the region, they were far more predominant in non-gcc countries, and the responses were more balanced across all issues (see Exhibit 7). For the supplementary countries, a lack of transparency, poverty, and the widening gap Exhibit 7 All generations across the region worry about the lack of transparency and unemployment Arab Generations Top Governance Concerns GCC Non-GCC 84% 83% 69% 67% 67% 59% 53% 46% ADG 44% 42% 38% 37% 35% 35% 29% 20% 91% 84% 73% 70% 71% 63% 56% 51% ARG 49% 46% 40% 39% 36% 34% 28% 19% ANG 46% 43% 35% 35% 32% 36% 25% 19% Corruption High level of unemployment Poor quality of healthcare Lack of freedom of speech Lack of infrastructure Poor quality of education High crime rate Political instability Survey Question: To what extent does each problem exist in your country? Source: Strategy& Arab Generational Divide Survey Strategy& 17

18 between the rich and the poor were seen as key issues. Despite these similarities, there are key differences between countries. Illiteracy was flagged as a key social issue in Morocco; political instability is much more of an issue in Lebanon, Syria, and Libya. Respondents in Libya also specify more governance issues, for example poor quality of healthcare, political instability, lack of infrastructure, high level of unemployment, and lack of transparency. Considering only financial challenges, the results also show a consistent pattern respondents identified, in the following order: the high cost of living in the region, broad societal poverty, expensive healthcare, and expensive education as the four main issues. Again, these were more predominant in non-gcc countries, and the responses were shared across all non-gcc generations (see Exhibit 8, page 19). 18 Strategy&

19 Exhibit 8 All GCC generations worry about the high cost of living and poverty. All non-gcc generations are concerned about all financial challenges. Concerns About Financial Challenges GCC Non-GCC ADG 61% 53% 46% 29% 87% 83% 80% 75% ARG 61% 53% 46% 29% 86% 81% 80% 76% ANG 64% 56% 46% 32% 83% 85% 79% 81% High cost of living Poverty High cost of healthcare High cost of education Survey Question: To what extent does each problem exist in your country? Source: Strategy& Arab Generational Divide Survey Strategy& 19

20 Perceptions about education are striking. They show a growing level of dissatisfaction with the quality of education offerings in the region. The ARG is less satisfied with education standards than the ANG, and the ADG is the least satisfied. Just 56 percent of ADG respondents rated their personal education experience as either excellent or good (compared to 84 percent of the ANG). The same pattern held true when respondents were asked about the quality of education available in their country (as opposed to their own personal experience). The older generations were more satisfied, and the younger generations less so. Some inter-country differences are worth noting. The UAE, Kuwait, and Qatar all received higher ratings (95 percent, 79 percent, and 75 percent of respondents, respectively, from these countries assessed their education as either excellent or good). By contrast, Egypt s scores were extremely low just 16 percent of participants believed this of their national system. Clearly, in societies and countries with lower illiteracy rates, and higher per-capita GDP, education quality is perceived more positively regardless of actual quality than in countries with higher poverty and illiteracy rates. Although these are perceptions and not objective quality rankings, it is a common practice in evaluating education systems to gauge the views of the customers the students themselves. For example, our recent study on students in the GCC revealed that they would like reforms to focus on developing more creative and inspiring content, improving teaching approaches, and addressing the lack of career guidance. 10 Perceptions about education are striking. They show a growing level of dissatisfaction with the quality of education offerings in the region. Moreover, respondents indicate that they believe education is a basic right of citizenship an entitlement that their national government must provide (along with healthcare and employment). Accordingly, those are areas where respondents feel governments should spend money primarily on healthcare, employment, infrastructure, and education. This finding applies across all three generations and all six countries surveyed, with slightly lower rates among respondents in Egypt and Jordan (see Exhibit 9, page 21). 20 Strategy&

21 Exhibit 9 All generations regard healthcare, employment, and education as the most important entitlements Top Entitlements from Government 100% 90% 93% 74% 98% 91% 75% 62% 100% 92% 79% 79% 64% 58% 45% 43% 33% 29% 29% 27% 0% 4% 7% 4% Right to basic healthcare Right to employment Right to free primary/ secondary education None of the above Egypt Jordan Kuwait Qatar Saudi Arabia UAE Survey Question: Which of the following entitlements/ privileges are you and other citizens of your country entitled to receive from your government? Source: Strategy& Arab Generational Divide Survey Strategy& 21

22 The survey also looked at the way that citizens discuss politics and communicate with their governments. Again, the common ties are more noteworthy than the differences. All three generations are likely to discuss politics and news about their own country. They are relatively less likely to discuss the Arab region in general, and least likely to talk about issues concerning the U.S. or the Western world. That said, these communications are often linked to discussions with friends and family, and they happen through different channels for different age groups (face-to-face conversations among older Arabs, and via digital means for younger Arabs). It is notable that some of the survey countries, such as Jordan and those in the GCC, also have a traditional communication mechanism, the majlis, a gathering in which members of the public can meet with officials on a regular basis. Most notable, however, is that the bulk of these communications are within social groups, and not between constituents and governments. Overall, however, just 9 percent of respondents have communicated online with their political leaders, primarily to give a suggestion, express an opinion, or register a complaint. There is a generational component at work here as well. Given the lack of communication between the large and growing population of younger constituents and the generally older politicians shaping policies for the region, it is perhaps understandable that many governments do not currently meet the needs of young people. That situation needs to change as the disconnect will only perpetuate current problems. Among the reasons cited for not communicating online, the primary reason all three generations mentioned was a lack of interest. Among the younger generation, key reasons revolved around the lack of a conducive environment to communicate with leaders. 22 Strategy&

23 Key priorities for policymakers and the private sector As governments craft policies to ensure that their countries remain competitive, they must keep these findings in mind. Specifically, governments can address concerns about transparency and the perception that they serve the needs of only a well-connected minority by delivering government services in a new form, such as through e-government channels. These will foster greater participation among all generations, particularly the young. Providing government services digitally will generate the interest that is so lacking in youth and, by connecting these services to engagement mechanisms such as social media, can create trusted channels for feedback and dialogue. E-government services can also play a role in making overall public services faster, more responsive, and more transparent by helping to raise standards. This is because e-government leverages increasingly pervasive technology to make government services more customer-centric, improves digital literacy, creates public- and private-sector opportunities, strengthens ties between citizens and governments, and so improves the quality of life for constituents. Structured correctly, e-government initiatives can even generate economic value for governments in addition to social and civic value by helping create new jobs. 11 Strategy& 23

24 The world of work A generational lens applied to labor trends and characteristics offers many insights to address the region s labor force challenges, including unemployment, low productivity and employee engagement, and large public sectors. The public sector in the Arab region still acts as a magnet for young graduates attracted by high salaries, employment protection, and a special social status, in particular in state-owned enterprises. In the context of diminishing public budgets, these policies are not sustainable. Indeed, the private sector is increasingly expected to create the jobs that will lower the high unemployment rates among nationals, and moreover is supposed to retain these young employees. Family businesses in the region can also benefit from a generational analysis. For example, some of the largest and most visible corporations in the GCC region are family businesses. Many of these companies are now facing a leadership transition to younger generations where work styles and visions for the family business may differ across generations. The survey and focus group findings regarding generational differences in the work environment are intriguing. In some areas they show animosity and a lack of understanding across generations of their different work styles. These negative perceptions can restrict productivity and collaboration. For example, the focus groups revealed that older workers were perceived as slow and lacking in communication skills by younger workers whereas younger workers are perceived as stubborn and impatient by the older generations. On the positive side, the younger generation is also perceived as bringing innovative ideas, being flexible, and taking the initiative. Also, the younger generations see themselves as more team-spirited than older generations (57 percent of the ADG identified with this trait, compared with just 26 percent of the ANG). The private sector is increasingly expected to create the jobs that will lower the high unemployment rates among nationals. The impatience factor shows up in other research about younger workers. One study about Generation Y globally found that they are likely to change jobs relatively frequently. The study shows that only 24 Strategy&

25 75 percent of people in the Middle East in this age group intend to stay in a job for more than two years. The numbers are even lower for more developed economies only 57 percent of Generation Y workers in the U.K. plan to stay for two years suggesting that short-term tenure among younger workers may become a growing issue in the GCC. 12 Viewed in the positive sense, this could also be an opportunity to bolster youth entrepreneurship in the region and work on providing workers with life-long career guidance services. Most of the attributes associated with the older generation are positive: They are seen as punctual, leading by example, respectful, willing to teach, and appreciative. Significantly, the main attributes of the different groups do not overlap at all (see Exhibit 10). Exhibit 10 ADGs are innovative, team players, and take initiatives but lag behind ARGs and ANGs in other workplace attitudes Work Attribute Associated with Younger Generation (Top 5 Attributes) Work Attributes Associated with Older Generation (Top 5 Attributes) 26% 62% 62% 58% 52% 61% 57% 45% 40% 54% 37% 53% 50% 42% 57% 58% 66% 75% 67% 64% 70% 65% 73% 70% 66% 72% 72% 63% 71% 68% Bring innovative ideas ADG ARG ANG Impatient Take initiative Flexible Team spirit Willingness to teach Controlling Lead by example Punctual Respectful Survey Question: Organizations have staff that comprises old and young employees. If you were asked to associate some attributes with staff older and younger than you, based on your experience and perceptions, which attributes would you associate with which generation of co-workers? Source: Strategy& Arab Generational Divide Survey Strategy& 25

26 Such differences could be a source of competitive advantage, in that diverse age groups bring complementary strengths to companies. In some cases, however, the differences can also lead to disagreements between younger and older workers. For example, as in other regions, older people tend to have a very traditional view of work and what it entails set hours, always in the office, etc. By comparison, young people have a more flexible perspective, in which performance matters more than time spent at one s desk. Some organizations in other markets have experienced similar disconnects between older and younger workers, and have taken steps to address these issues. For example, MITRE, a U.S.-based nonprofit that manages research projects for the federal government, had a high proportion of middle-aged workers, which led to higher turnover among younger workers. Many left MITRE because they did not feel that they fit in. In 2007, MITRE launched an effort to become more welcoming to younger workers through changes to the recruiting, networking, and onboarding aspects of HR. Younger workers can also provide feedback directly to executives at MITRE through both informal channels, such as lunches with the CEO, and more formal mechanisms, such as a millennial advisory committee that reports to the C-suite via quarterly meetings. 13 Technology requires the strengths of the ADG One implication of these findings is that technology-oriented enterprises require the qualities exhibited by the ADG, particularly innovative thinking. As technology-dependent businesses grow in relative terms and as a percentage of GDP in the region, these qualities are worth cultivating, even if older generations find them troublesome. Young people have a more flexible perspective, in which performance matters more than time spent at one s desk. Related to the theme of technological development, the survey results show that Jordanians are the least satisfied with their financial situation among all six countries we analyzed. Jordan has recently been a regional hub for technology talent. However, the lack of financial opportunity in the country is eroding Jordan s position in the digital sector, as many technologically skilled Jordanians are leaving for the GCC. A clear implication is that the region is competing against itself for digital talent and, in net terms, adding little incremental value to the region overall. Women in the workplace Gender equality in the workplace was a key area of inquiry during our survey. In general, the older generations are more likely to believe that women currently enjoy equal work opportunities with men. With some 26 Strategy&

27 regional variations, approximately half of all ARG and ANG respondents believe this is true. However, the ADG are less likely to agree, and this disparity is more pronounced among women in the ADG. Only 45 percent of that group believe that women have the same opportunities to work as men. One potential explanation for these findings is that younger people in the Arab region have higher expectations. Many countries have made strides toward gender equality in the workplace, and while older workers may feel that those measures represent significant progress, younger people believe that it is not enough. Although this may be a perception predominantly expressed by younger workers, Strategy& s Third Billion Index, which measures female economic inclusion, reaffirms the fact that measures taken to empower women in the past years in Arab countries have not been sufficient. 14 Almost all of these countries are in the earliest stages in their efforts to economically empower women. Although each of these countries faces unique circumstances, governments and companies in these countries and throughout the Arab region have a powerful opportunity to boost their own economic growth by opening new doors for women. Cultural norms are crucial in assessing the belief in a woman s right to work. More than 50 percent of all respondents, across all three generations, support women seeking employment, provided there are rules and regulations in place to respect the country s traditions and culture. Respecting cultural norms also comes across strongly in the focus groups conducted with female workers. Another large percentage support women working in certain types of jobs in certain professions such as nursing, education, or office work (i.e., non-physical labor). A far smaller minority support this notion unconditionally. The results also show strong support for women in the workplace in most GCC countries, despite their social conservatism. Support is much weaker in countries where unemployment is high Egypt and Jordan which could reflect a greater competition for scarce jobs. Among the GCC respondents who support women working, there is broad agreement about the reasons for this: namely so that women can be productive, contribute financially to their households, take advantage of their education, secure their children s future, give them the freedom to meet new people, and broaden their perspective on life. In other countries however, the reasons for supporting women were different. The majority of respondents support a woman seeking employment so that she is able to play an important role in securing her family s future, or so that she is able to financially contribute to the household, rather than simply to be productive or make herself useful. Again, these findings perhaps reflect the need for both parents to contribute to the household income in countries with higher poverty rates and more income challenges. Strategy& 27

28 Although support for women working is clearly increasing, women continue to face many challenges. Women s labor force participation in the Arab region is just 26 percent, compared with that in South Asia (35 percent), East Asia and the Pacific (64 percent), and sub-saharan Africa (61 percent). Improvement efforts for women in the workplace need to ensure that women are both prepared with the right education and enabled with the right support. Key improvement opportunities include diversifying university majors offered to women, teaching skills required for the job market, promoting local female entrepreneurship, and identifying opportunities for women to work from home. Notably, the majority of respondents who support women seeking employment are least aware of the positive impact of such measures on the overall economy (see Exhibit 11, page 29). This is a potential opportunity to educate citizens, as there is convincing evidence that adding women to the workforce can spur economic growth. For example, Strategy& research indicates that raising female employment to male levels would boost the overall GDP of the UAE by 12 percent, thanks to the increased productivity of a national workforce that would be approximately doubled in size. For Egypt, the effect would be even more pronounced equitable employment levels for women would boost GDP by 34 percent. 15 There is a leverage effect as well economically empowered women are more likely to invest a portion of their household income on education for their children. As those children grow up, they will pursue careers of their own, creating further social and economic gains for the country. This is one way in which an awareness of generational effects can help policymakers craft policies that lay the groundwork for long-term growth. Economically empowered women are more likely to invest a portion of their household income on education for their children. Among those who do not support women working, the principal arguments are that women need to stay at home and take care of the family, that it is not safe, and that it runs counter to tradition and culture. These reasons were similar in the supplemental set of countries, with the top two reasons being the need to stay at home and take care of the family (70 percent) and the safety issue (44 percent). Regarding employment benefits, respondents in all three generations agreed that priority items should be free health insurance for the employee and his or her family. This was followed by a housing allowance, flexible working hours, and an education allowance for children. Notably, child care was a key priority in Kuwait, which is understandable given the high percentage of working Kuwaiti women some estimates put this number at more than 40 percent of the female population. Also significant is that there was no difference between men and women regarding the demand for employer-based child-care facilities men in the region were as likely to demand child care as women. 28 Strategy&