What does Saudization mean?
When reading about looking for work in Saudi Arabia, you will probably come across the term “saudization”. While this is a relatively new term in Saudi Arabia, you will probably be seeing it quite often as it is considered to be one of the major hurdles when it comes to building a career in the country as an expat.
So, what is saudization and how exactly can it affect your career prospects in Saudi Arabia?
What is Saudization?
Saudization is a Saudi government national employment scheme (also known as Nitaqat) aimed at getting more Saudi nationals involved in the workplace. Under this scheme, companies in the private sector are obligated to employ Saudi nationals instead of non-Saudi workers. Saudization is an essential part of the Saudi Vision 2030 reform program.
In Saudi Arabia, the program dates back to the Fourth Development Plan of the country (1985-1989). Being revived throughout the years with variable success, 'Saudization' is in full force today to help with overcoming the high unemployment rate among Saudi nationals (11,6 % in 2019). The government aims at decreasing that number to 7% by 2030, a key priority at the Saudi Vision 2030`s reforms - a national strategy for weaning off the country from oil and diversifying its economy. The Saudi economy is heavily dependent on foreign labor so far.
How does Saudization impact foreigners?
Saudization has a direct impact on foreigners already working in Saudi Arabia or planning to move to the country. First, you will have limited working options when looking for work as certain fields and specialties are limited to Saudi nationals. Second, since the implementation of the new law there have recently been instances of massive lay–offs of expats in favor of local candidates, which threatens the notion of job security for expat professionals in the region.
The private sector entities are classified into six categories. Only companies with less than 10 employees are exempt from the zoning, but they have to hire at least one national, accordingly. In some markets, the foreign workforce has been replaced with Saudi nationals already, while others are pending their enforcement dates. For instance, all dentistry jobs are reserved for Saudis starting March 2020, as per the latest decision. The changes are due to happen gradually, with parallel training and education programs provided. Another example is Saudi Aramco - the national petroleum and gas company, one of the largest companies in the world by revenue. It is expected to achieve 90% of Saudization in 2020.
The best possible way to keep up to date with all the changes with the Saudization program is to check the official Ministry of Labor and Social Development website.
Important:
Authorities practice sudden inspections on markets to ensure that the policies are being followed. If caught breaking the policy, the business is liable for heavy fines and possible closure.
Jobs foreigners aren't allowed to take in Saudi Arabia
There are a number of sectors and specific positions where employers are no longer eligible to hire foreigners. These include:
- All clothing retailers (women, men, children)
- Banking (tellers, in-branch support)
- Gold markets
- Telecommunication (offices, storefronts)
- Home furnishings (sellers)
- Auto shops & spare parts (desk officers)
- Office supplies
- Electronics
- Medical equipment
- Building materials
- Watches and clocks
- Optic stores
- Pastry shops
- Carpets
- Entertainment
Important:
In accordance with “saudization”, the introduction of “feminisation” was announced. Feminisation is the requirement by law to employ Saudi females in any retail sector that sells female products (clothing, make-up, accessories, etc.) or provides services for females.
As an expat looking for career opportunities on the job market in Saudi Arabia, Saudization is definitely something you should be aware of throughout your job search. While work opportunities for foreigners are now less abundant than they used to be prior to the introduction of the policy, qualified professionals will still find job opportunities in Saudi Arabia — especially in the in-demand fields like hospitality, IT, media, engineering and others. When applying for a job, keep the new conditions in mind and do your best to highlight the unique expertise and experience you will be bringing to the job.
Useful links:
