Business leaders: New Nitaqat quotas ‘difficult to implement’

Businesspeople say the new Saudization quotas the Labor Ministry is introducing on April 20 would be difficult to implement because of a lack of skilled Saudi workers in the job market, with some calling for a delay of between one to three years.
Under the third phase of the Nitaqat program announced by the ministry, the Saudization quotas for big firms would be increased from 25 to 41 percent, the same as the retail and wholesale trade sector, while it would be raised from 29 to 66 percent for big groups.
“The ministry’s announcement has caused deep concern among companies because of a lack of qualified Saudi workers to fulfill the Nitaqat conditions during the specified period,” said Ibrahim Batterjee, chairman of the industrial committee at the Jeddah Chamber of Commerce and Industry (JCCI).
Batterjee said the implementation of Phase 3 of the Nitaqat program for downstream industries is one of the main problems facing businesses.
“The ministry has decided to increase the Saudization rate for all small and medium enterprises, and giant companies,” he said.
Companies have to meet the new Nitaqat quotas to expand their operations, get visas for workers and have access to the ministry’s other services. The Council of Saudi Chambers (CSC) has reportedly sent a letter to the ministry, requesting it to delay the implementation for three years.
“We understand the ministry’s desire to increase the Saudization rate to accommodate new Saudi graduates from universities and technical institutes,” Batterjee said.
However, he said the ministry must take into account the reality out in the market. “The market does not have an adequate number of qualified Saudi hands to fill industrial jobs. Private companies do not attract enough Saudi workers when they advertise to fill vacancies, even after offering good salaries and benefits,” he said. Employment centers of other chambers have also reported the same situation, he added.
Speaking with Arab News, Ibrahim Badawood, managing director of ALJ Community Initiatives, said the government must strengthen training programs to meet job market requirements. “Since 1980, the industrial sector has been saying they don’t get qualified Saudi workers. This means there is something wrong with the training program.”
Badawood urged the ministry to provide companies enough time, at least one year, to get qualified Saudi workers. “The problem is most Saudi graduates prefer either government jobs or white color jobs in the private sector,” Badawood said.
“To address this problem, companies must recruit secondary school graduates and give them proper training to fill their vacancies. The technical and vocational training centers should also change their programs to meet job market requirements.”
Khalaf Al-Otaibi, a member of the JCCI board, said the development of the country’s industries require a conducive regulatory environment. Adnan Mandoura, secretary-general of the JCCI, called for greater coordination between the industrial sector and related government departments. “The JCCI will work to remove the obstacles facing companies and make proposals to change or soften regulations.”