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Tue 11 Mar 2014 11:30 AM

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Saudi retailers claim they've lost $160m under rules to hire women

Business council claims 25% of retailers forced to hire Saudi women had shutdown amid huge losses

Saudi retailers claim they've lost $160m under rules to hire women
(Getty Images - Photo for illustrative purpose only)

Saudi Arabia’s push to employ more women in retail stores has cost businesses $160m in lost sales, a member of the Jeddah Chamber of Commerce and Industry (JCCI) has claimed.

Mohammad Al Shahri, chairman of the JCCI’s textile and clothing committee, said 25 percent of small and medium-sized shops affected by new rules to hire Saudi women had shut down and numerous others were considering closing their doors, Arab News reported.

Businesses were struggling to find Saudi women to fill the roles, while the female employees expected to be paid double the salary of an expat.

The government has recently moved to relax restrictions on the employment of women in Saudi retail outlets, particularly female clothing and lingerie stores.

The third phase of the feminisation program, launched this week, covers stores selling women’s perfumes, maternal care goods, shoes, vanity bags, readymade dresses, women’s clothing and dressmaking materials.

Al Shahri said businesses had shut also because of increasing costs, including rising rents and fines imposed on companies who do not meet strict requirements to hire a certain number of locals, under the kingdom’s Saudization program.

He said retailers, who claim they were not sufficiently consulted prior to the implementation of the feminisation program, did not oppose hiring women but had found it difficult to implement and called on the Labor Ministry to slowdown the introduction of further phases.

However, assistant deputy minister for development, Fahad Al Takhifi, said the government was determined to fully implement the feminisation program and businesses had been given sufficient time to adapt.

“We will not be lenient with those who fail to implement the Saudization of lingerie shops and will continue our inspections of such stores across the kingdom,” he was quoted as saying.

Al Takhifi said 1,173 shops had already violated the regulations.

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