Emiratisation failing to cut UAE jobless rate - Al Mulla

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The UAE government's emiritisation policy is simply cosmetic and is failing to reduce the “shocking” unemployment rate among nationals, leading UAE lawyer Habib Al Mulla has said in a provocative speech at the Arabian Business Forum.

Private sector employers were manipulating government quotas that encourage the employment of nationals, while the real issue of properly educating Emiratis was being ignored, the chairman and co-managing partner of Baker and McKenzie Habib Al Mulla law firm said.

Al Mulla, who has been involved in the drafting of many UAE and emirate level laws and created the country's financial free zones, said emiritisation policies were clearly not working, with 28 percent of the 1m UAE nationals still without jobs.

“That's shocking, particularly in a country that provides over 5m jobs,” he said.

“To put this in a comparative context, the Eurozone unemployment rate rose in 2012 to 11.8 percent and that was considered the highest rate on record at the time.”

The UAE government created its emiritisation policy to help take the burden of employment off the public sector, but setting quotas was the wrong method, Al Mulla said.

“Imposing quotas is an easy solution to the problem of unemployment. However, it's temporary, impractical, and a deceiving solution,” he said.

“It does not deal with the roots of the problem. Rather it provides for a cosmetic touch.

“In my view, the worst result of imposing quotas is that it leads to disguised employment.

“The government is trying to impose something the private sector is resisting; the natural result is that the private sector will try to circumvent that.”

For example, some companies employed UAE university students under the guise of a scholarship but did not require them to work during the scholarship period. They also then discouraged them not to join the company at the end of their studies, to enable it to repeat the process with another student.

“The net result is that it increases the national employment figures. The actual figure would be only 10 percent … had these students been employed regularly and properly – but they're not the figures that meet the quotas,” Al Mulla said.

Large companies also were skirting the quotas by dividing into numerous entities and outsourcing to each other, meaning the original 5 percent of nationals employed suddenly rose without any new employees, he said.

Even under the quota system, only 8 percent of private sector employees are Emirati.

Al Mulla said a survey of Emirati workers found 58 percent believed the private sector provided low salaries, 53 percent said it expected long working hours, while 13 percent were concerned about attracting a bad reputation for working in the private sector.

Al Mulla said the main determining issue was the lack of adequate skills and proper education among nationals.

“The main issue with the quota system is it fails to provide the younger generation with proper, professional or vocational training and proper skills,” Al Mulla said.

“There's a lot of skills mismatch going on and younger people who have these high expectations are waiting and hoping they'll get better jobs.

“What we have right now is inadequate education that does not stress technical or vocational skills. It's essential for nationals, whether in the UAE or in other GCC countries or the wider Arab region, to be equipped with the right skills and vocations to be competitive in the private sector.”

However, he said the private sector also deliberately discouraged nationals from applying for jobs.

Salary packages, for example, were usually targeted at expatriates, with inclusions such as a housing allowance and annual flight home.

“This [speech] is not to say that the private sector, which is mainly dominated by the expatriate community, does not discourage against UAE nationals. That is a fact that has to be said,” Al Mulla said.

“However, the key solution to this is not by imposing quotas. The key to employment is education that really the market needs and that's the way to have a successful emiritisation.”

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Please post responsibly. Commenter Rules

Posted by: Paolo C

How can you expect locals to go to work when you feed them, house them, spoiled them. It's a 5th grade psychology understanding..

Posted by: Sal

Dubai and GCC at large at time more capitalistic than western countries.

Posted by: Englishman in Dubai

It seems like the private sector is always perceived as a purely "expat sector," but aside from free zone companies, private companies in the UAE must have a local sponsor.

Posted by: Englishman in Dubai

Telcoguy, what you said is essentially what I was hinting at. Locals have many privileges for doing business here, so I wonder where is "the people's willpower and ambition"?!

Posted by: Englishman in Dubai

Oh, I didn't think that I needed Telcoguy to "fix" the expression of my opinion. In fact I already had to "fix" my comments considerably in order to get them published on here.

Posted by: Ahmad

Allow to add my own experience as an emarati. I worked in the private sector and the government and I have over 16 years of experience. Today I can say that the nation employees are well educated and some also possess above average experience but they are not given the chance to grow in the private sector. I have seen lots of unqualified expat with no experience recruited in high posts due to their nationality dominating the organization. Claiming that emaratis are under performing is only and excuse. A lot of strategies were implemented to get rid of emaratis and build a negative perception about them. The solution is to enforce private sectors to employ emaratis in the top management and the gov should monitor and assess the success of that every quarter. Also gov should dismiss any management that stop this plan, emaratis started to build this feeling of undermined and unfairly treated by expat which in unhealthy to the society.

Posted by: mumen

To Ahmed: If you wish Dubai to become like Kuwait, then of-course all Emiratiis should be employed, prioritized and create the hate-expat culture.

Posted by: Geko

Many of the expats would agree with you on that. If Govt has to dismiss any management, they should shut down more than 60% of the huge business houses since most of them are fully owned, and directly controlled by Emaratis. Things are pretty serious and impossible, if you are not believed by your own. Don?t blame it on anyone else.

Posted by: SA1

This might be true ...but other way happens with Emiratis at Govt Companies getting promoted and very open preference over expats....."equal opportunity" is not a concept in this region.

Govt can do many things including controls as suggested by you, but why are they not doing it....it is easier said then done.

They know very well the negative consequences over the economy with such controls.

Posted by: Mick

A coupled article here on ABnews is that civil servants (public employees) are having their salaries raised by 30 - 100%....does anyone see a failure connection? This gentleman is spot on.
The government should consider hiring ANY nationality based on potential performance levels + qualifications (that don't include nationality) and rating existing public sector employees to ensure that the local workforce does whatever is necessary (education, training, experience) to obtain those jobs...once they are established as absolutely appropriate fits and after achieving a level of performance excellence...then pay them anything...a hundred thousand a month....whatever..... but to pay for mediocrity based on passport is tantamount to future issues and regression. To hire and maintain based on excellence would promote more efforts to qualify.

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