Activation Policies for the Poor in OIC Member States
42
characteristic is that unemployment is much more common amongst females compared to
males with 34% of females out of work and only 6.2% of males.82 Improving economic
opportunities for females in Saudi Arabia has been identified by the Ministry of Labor as key to
boosting economic growth.
2 Reduce rates of youth unemployment: Another salient issue is that of youth unemployment.
The Human Resources Development Fund (HRDF) reported that the unemployment level
amongst Saudi youths was as high as 41% in 2013 compared to a rate of 8.2% among non-
youths. 83 This is a worrying key challenge for the government as the youth population
increases. Dissatisfaction among young people of Egypt, Tunisia and other Arab countries has
led to uprisings and government opposition in recent years. The high unemployment rate
amongst youths is also detrimental to the economy of today and the future.
3 Increase the labour market opportunities for persons with disability: The government is
also seeking to implement an employment programme for people with disabilities (PWD).
Accurate data is not currently available on the country’s disability rate. However, providing
employment support to people with disabilities, which requires data on disability rates and the
types of disability customers have, is now a priority for HRDF. HRDF is running a pilot, for
example, to gather accurate data in this regard.
4 Reduce regional disparities: Unemployment rates vary significantly between 10% for more
the economically active regions and 23% for more rural and less developed regions in the North
of the country where there are limited labour market opportunities and significant variations in
the education level of the community due to access.
5 Economic diversification: Saudi Arabia has considerable reliance on oil to fuel economic
growth. The oil and gas sector accounts for around 50% of gross domestic product and up to
85% of export earnings. 84 However, over reliance on this finite resource is an issue that the
government is trying to address. Economic diversification has become a central policy aim of
the Saudi government in recent years. The Kingdom recently launched plans to construct six
new ‘economic cities’ that can be the drivers of future growth. The construction of these cities
will require a considerable amount of skilled labour and infrastructure development represents
a unique opportunity for jobseekers if they are given access to training services. By 2020, it is
estimated that these new industrial cities will create 1.3 million jobs.85 The government
announced that it planned to focus on three key areas in 2014 budget spending: education
SR210 billion (US$54.9 billion), health SR108 billion (US$28.2 billion) and infrastructure
SR66.6 billion (US$17.2billion).
6 Reduce levels of skilled migrant labour: A key challenge is the fact that there are significant
skill mismatches amongst the resident Saudi population. Many young Saudis are university
educated but hold degrees in arts and humanities rather than technical and science degrees. As
a result, there is a lack of hard skills amongst the Saudi population and the labour market in
Saudi Arabia has to rely very heavily on foreign labour. The private sector is especially
dependent on expatriates with around 80% of all employees from other countries. The public
sector, on the other hand, is the opposite with around 99% of public sector employees being
Saudi nationals. The skills mismatch amongst Saudi nationals is brought to light especially by
employment figures from the construction sector. Construction accounts for around 43% of
total private sector employment, however only 6.7% of those employed in the sector are Saudi
82 Central Department of Statistics and Information, 2014.
83 Al-Nujaidi, A. (2013) Youth Unemployment Initiatives and Services in Saudi Arabia. Available at
[accessed 8th September 2014].
84 OPEC Annual Statistical Bulletin 2014, Available at
[accessed 11th September
2014].
85 Arabian Gazette, 2014. Available at
[accessed 9th September 2014].