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The new era of Saudisation

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Launched as part of Vision 2030, Saudi Arabia’s National Transformation Program aims to encourage a new wave of Saudisation. But what does it mean for employers?

In June 2016, Saudi Arabia approved the National Transformation Program (NTP), a key component of a broader aim to prepare the Kingdom for the post-oil era. One aim of the plan is to cut Saudi unemployment from 11.6% to 9% by 2020. To help achieve this, more than 450,000 jobs will be created in the private sector. So how will employers react to this Saudisation push?

Ed Musiak, Saudi Arabia country director for Cazar, recently sat down with Abdullah A. Aludah, HR manager at Thiqah Business Services, and Adel Alsuhaimi, respected consultant and ex Saudi Arabia country director of Al-Futtaim Group to understand what this means for employers’ manpower strategy in the years to come. 

How will corporate recruitment change with the NTP?

Alaudah: The advantage we have is that 70% of Saudis are under 30. So there’s a huge opportunity for private sector companies to hire young Saudis and train according to market needs. We will see companies in the next few years become more proficient at attracting the best candidates and training them. This starts with training the recruitment and HR teams having a sound strategy and the right tools.

Alsuhaimi: By addressing a number of factors that are detrimental to success in the recruitment process. Salary levels have to be significantly revised upward. Most organisations have kept salary scales nearly flat since mid-1980s. Neighbouring Gulf states have elevated salary offerings to citizens many times over during the same period. Despite keeping inflation at bay, the cost of living in the Kingdom has risen sharply, especially in the last decade.

What tools and strategies can be used to target the next generation?

Alaudah: The old-fashioned way of recruiting is of no use. Young Saudis don’t read newspapers or watch TV anymore, so employers must adapt to the technology and media they use. Using tools such as social media, targeted hashtags or sites like YouTube reaches the right individuals.

It’s important to have a proactive approach and go after the candidates you want. Don’t just post a job on LinkedIn or on your website, contact the person directly and make them feel important. 

Young people want engaging content – rich media and information that addresses their concerns and desires; growth opportunities; a good working environment; activities and other aspects. These factors make them choose one employer over another. 

Alsuhaimi: Using technology is key. Conventional methods will only tap into a small percentage of this talent pool. The Saudi Counsel of Ministers should help private companies by investing in smart solutions to search, match, screen, interview, and acquire candidates. 

Is salary a key issue?

Alaudah: Everyone wants decent pay and job security, but top candidates prefer to work for an employer offering growth, the opportunity to learn skills, a people culture, flexible hours and an adequate salary, rather than a great salary but nothing else. Smart graduates – those you want to hire – don’t think short term. They realise the work experience they acquire in their first few years out of school is worth more than the salary during that time.

Alsuhaimi: Other factors weigh in such as job description, chain of command, location, benefits, and size and stability of employer. But for me, the priority will always be the candidate’s financial return on the experience, skill-set, talent, knowledge, the value they bring to the job and employer.

How important is retention?

Alaudah: Retention and attrition rates are very important here as everywhere. Money can retain good people only so long. The key lies in training, career progression, the environment and the overall employer DNA.

Alsuhaimi: A sought-after candidate will have to short-list job offers methodically to choose a final employer. This process is time-consuming, stressful and usually done while the candidate is transitioning between jobs or just graduated. Employer fit and career longevity are therefore vital criteria.

From the employer’s perspective a similar analysis will ensue. They also have a tedious selection process that requires time and resources followed by training and mentoring. They want to avoid repeatingthe process regularly so a good retention strategy is vital.  

Are schools and universities tailoring skills to the job market?

Alaudah: This is an issue around the world. A lot of people come out of school lacking the skill sets for the corporate world, which is why training is so important. Last year, the Ministry of Education started the Your Job, Your Scholarship programme which signs partnerships with various government agencies to send qualified students on foreign scholarships in accordance with their actual needs for specialised manpower. I hope this will help educational institutions adapt their programmes to the needs of the corporate world.

Alsuhaimi: In the past, educational policies have not always been effective, with conflicting agendas between the different government and semi-government agencies around finalising curricula. Teachers are also underpaid, overworked, unappreciated, and ill-selected. When you weave these factors together, the schools system is bound to fail because there is no motivation for teachers to excel. It’s considered only a ‘job’ without merit or future. When one compares this situation with top global educational systems such as South Korea or Singapore, it is evident where the problem lies: strategy implementation and teachers.

The young Royals here are trying hard to fix these issues and are adamant that the educational system requires improvement. We could very well see positive results in 5-10 years from now if an effective solution, strategy and implementation are adopted seriously.

Karam Filfilan

By Karam Filfilan

Changeboard

Karam is Changeboard Middle East's editor and UK deputy editor.

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