Saudi Arabia clarifies new rules over expat jobs

Labour Ministry says new regulations limiting work permits would not apply to 'house servants'
Unemployment among nationals in the kingdom is currently 10.5 percent
By Andy Sambidge
Tue 31 May 2011 06:07 PM

Saudi Arabia's labour ministry on Tuesday moved to clarify its position on expat workers amid confusion over new Saudization rules and regulations.

Media reports quoted Labour Minister Adel Fakieh as saying all foreign workers who have spent six years in the kingdom would not have work permits renewed as part of its plan to create jobs for nationals.

But a ministry spokesman told state news agency Saudi Press Agency that the rule only applied to expats working for companies who do not meet new Saudization criteria.

He also said the new measure would not apply on house servants as their permits would be renewed without considering how many years they stayed in the country.

Under the new Nitaqat system, companies are split into red, yellow and green categories depending on their level of employment of nationals.

The ministry said the measure would be applied on those foreigners who work for companies in the yellow and red category.

The spokesman added that permits of foreign workers in red category companies would not be renewed at all, irrespective of the years they have spent in the kingdom.

Companies in Saudi Arabia will have a three-month period to September 7 to achieve a prescribed quota of Saudi employees.

Unemployment among nationals in the kingdom, which sits on more than a fifth of global oil reserves and is the world's biggest oil exporter, is currently 10.5 percent, he said, adding that 28 percent of the unemployed were women and 40 percent high school graduates.

Despite its wealth, unemployment in the Gulf Arab state has risen as an outdated school system focused on religion and the Arabic language produces graduates who have difficulty finding jobs with private firms.

Companies favour workers from Asia, prepared to work long hours for low salaries, or well-paid foreign experts.

Many Saudis work in the public sector but, in contrast to other Gulf oil producers such as Kuwait, citizens do not automatically get a job because of the rapidly rising population, which now stands at almost 19 million.

In 1994 the government began a "Saudisation" plan, setting quotas for the number of nationals private firms must hire. The programme failed to achieve a significant increase in the participation of nationals in the private sector, where Saudis still account for only 10 percent of employees.

Almost 70 percent of Saudis are under the age of 30, and the population is increasing by around 2.4 percent annually.

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