In a recent report on the MENA economy by EMIR, an examination of the labour markets in Saudi Arabia (KSA) and the United Arab Emirates (UAE) reveals contrasting trends in talent attraction and labour force participation.
The challenge of talent attraction in Saudi Arabia
One of the key findings of the report is that Saudi Arabia faces notable challenges in attracting top foreign talent. Despite its ambitious Vision 2030 initiative aimed at diversifying the economy, the Kingdom's labour market is marked by a relatively low participation rate among foreign professionals. This limitation could hinder KSA's ability to innovate and adapt to a rapidly changing global economic landscape.
Several factors contribute to this challenge:
Regulatory barriers: Stringent labour laws and visa regulations can deter foreign talent from seeking opportunities in Saudi Arabia. This is particularly evident in job roles requiring specialised skills, such as architects, engineers, and real estate developers, who are critical to large-scale real estate projects.
Cultural factors: Perceptions of cultural differences and the work environment may also influence decisions by expatriates considering a move to KSA.
Economic diversification: While KSA is investing in various sectors, the current talent pool does not adequately meet the demands of these evolving industries.
Hintel conducted a survey named ‘Working in KSA’ of over 500 expatriates who have either previously lived or are currently residing in the Kingdom of Saudi Arabia. The findings revealed that 77% of respondents stayed longer than they initially intended, highlighting a strong positive sentiment and numerous reasons for extended residency in the region.
“My wife was adamant she would never move – now she’s here she loves it!”
Working in KSA anonymous survey respondent.
UAE: A hub for high talent attraction
In contrast, the UAE has established itself as a magnet for top-tier foreign talent. The country’s strategic initiatives and favorable business environment have led to a significant influx of skilled professionals across various sectors. Key factors contributing to this success include:
Open labour policies: The UAE’s relatively flexible labor regulations and visa processes make it easier for foreign workers to settle and contribute to the economy.
Quality of life: With its cosmopolitan lifestyle, advanced infrastructure, and robust safety measures, the UAE offers an attractive living environment for expatriates.
Innovation and technology: The UAE’s commitment to innovation has positioned it as a leader in attracting skilled professionals eager to be part of cutting-edge Real Estate developments.
Implications for economic growth
The disparities in talent attraction and labour force participation between KSA and the UAE may have implications for economic growth in the region.
For Saudi Arabia: The challenge of limited foreign talent could slow down the Kingdom’s efforts to diversify its economy and drive innovation. Addressing regulatory barriers and enhancing the overall appeal of the labour market will be crucial for attracting the expertise needed for sustainable development.
Contrary to market perception, Hintel's "Working in KSA" survey found that 92% of participants rated team inclusivity at 3 or higher. This is notable given the diversity in nationalities and experience levels within the teams, with the majority of respondents expressing a positive outlook on both the work ethic and inclusiveness of their teams.
“The Saudi companies and workforce are all very inclusive, welcoming and friendly”
Working in KSA anonymous survey respondent.
For the UAE: The continued influx of skilled professionals is likely to reinforce the UAE’s position as a regional hub for innovation and investment. This could lead to further economic diversification and resilience, ensuring sustained growth in a competitive global landscape.
The contrasting labor market dynamics in Saudi Arabia and the UAE highlight the critical role that talent attraction plays in economic development. As MENA countries navigate the complexities of globalisation and economic diversification, fostering an environment conducive to attracting and retaining top foreign talent will be essential.
Tom Brooks, Country Lead (KSA), commented: “I agree that Saudi Arabia's got some work to do when it comes to attracting foreign talent.
The regulatory hurdles and cultural factors make it tougher, especially for niche roles in real estate, which we’ve seen firsthand.
That said, the fact that expats are sticking around longer than expected is a good sign once they’re settled.
As for the UAE, no surprises there – it’s clearly ahead of the game. With its open labour policies and great quality of life, it’s a magnet for talent, especially in real estate. They’re in a strong position to keep driving growth.
Overall, Saudi will need to ease up on some of the regulations if they want to compete with the UAE on talent attraction.
We’ve got the expertise to help navigate that, though, and there’s room for us to support them in getting the right people on board.”
Hintel is a talent consultancy, recruitment outsourcing and executive search partner exclusively for Real Estate and Construction, helping your business build and sell the best properties in the world, through the best people. Speak confidently to one of our expert consultants on how to to recruit across the GCC today.
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