Many Saudi Companies Not Complying with Saudization Policy
Dec 13, 2011
Saudi Arabia, the top destination of overseas Filipino workers (OFWs) started implementing Saudization or the Nitaqat system last June, a policy that aims to prioritize the hiring of Saudi citizens over foreign workers. However, after six months of implementation, labor officials in Saudi are saying that Saudization is so far a failure.
In fact 50% of private companies in Saudi are non-compliant with the scheme despite warnings that they would not be issued new work visas. This information appeared in an article in Emirates 24/7, a news site based in Dubai, UAE.
Saudi Arabia decided to impose the Saudization scheme in an effort to solve the country’s rising unemployment rate. The Labor Ministry of Saudi further informed that while more than six million foreigners are presently working in private companies in Saudi; over one million Saudi nationals are unemployed.
The Saudi labor minister, Adel Faqih said that Saudi has an unemployment rate of 10.5% by the end of 2010. Faqih added that expatriates comprises about 90% of the workforce of private firms in Saudi.
The news article in Emirates 24/7 said that analysts called Saudization as the most radical measure of Saudi government to encourage hiring of more locals and less foreigners.
The July 2011 data shows that Saudi Arabia has more than eight million expatriates and of that figure 1.2 million are OFWs.
The implementation of the Saudization policy last June got many worried that it might leave thousands of OFWs unemployed. However, the Philippine Overseas Employment Administration (POEA) calmed the public by saying that it would not have an immediate impact on OFWs because it would be implemented in a gradual manner.