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Edition: U.S. Article Comments (0) Email Print Reprints Full Focus Editor's choice A selection of our best photos from the past 24 hours. Full Article Read Special report: Conservative donors let Christine O'Donnell sink 10:32am EDT Appeals court stays ruling on gays in military 20 Oct 2010 U.S. plan hits opposition at G20, FX accord remote 11:06am EDT CERN scientists eye parallel universe breakthrough 20 Oct 2010 UPDATE 1-Cirrus Logic Q2 misses; sees Q3 rev below Street view 8:59am EDT Discussed 62 WRAPUP 1-Two Fed officials favor aggressive easing options 59 Jobs blasts rivals as iPad sales disappoint 50 Merkel says German multiculturalism has failed Watched Red faces over top model gaffe Tue, Sep 28 2010 Russian spy poses for Maxim Tue, Oct 19 2010 Rare public appearance Sun, Oct 17 2010 Special report: Putting the Gulf to work Tweet This Share on LinkedIn Share on Facebook Factbox In the Gulf, a public job beats a private one 9:23am EDT Analysis & Opinion The curse of the blue diamond Related Topics World » A worker is silhouetted as Burj Dubai, the tallest tower in the world, is seen in the background at a construction site near Burj Dubai Mall, October 29, 2008. Credit: Reuters/Ahmed Jadallah By Erika Solomon and Regan E. Doherty DUBAI/DOHA | Thu Oct 21, 2010 9:23am EDT DUBAI/DOHA (Reuters) - When Qatari paramedic Mohammed Majib rushed to Sheikh Khalifa bin Hamad al Thani's royal palace in the mid 1990s after a call for help, he wasn't sure what the ailing Sheikh found more shocking -- the heart attack he had just suffered, or the fact that his medic was a local. "You're Qatari?" the former ruler gasped, as Majib went to work. "Ma Sha' Allah. (God bless you)." Khalifa's surprise was understandable. Across the Gulf, and especially in states where rapid growth is driven by oil and gas, locals rarely have hands-on jobs in health -- or anywhere in the private sector. In an unspoken pact between rulers and ruled, Gulf citizens seem all too happy to fill plush government jobs, where the pay is high, the hours short, and the work sometimes nonexistent. In the private sector, job after job is filled by South Asians, non-Gulf Arabs and Westerners. Gulf Arab rulers have known for more than a decade that this is a problem, not least because it hands day-to-day power over whole sections of the economy to foreigners. Foreign workers make up more than 80 percent of the private workforce in many Gulf states and hold key positions running national airlines, real estate and financial service companies and the media industry. In response, governments have introduced 'nationalization' schemes aimed at pushing their workers into the private sector. Oman was the first, setting out in the 1980s to 'Omanize' its workforce; governments in Bahrain, Kuwait, Qatar, Saudi Arabia and the United Arab Emirates have all followed. Typically, the schemes combine tax incentives for private companies to hire locals, quotas, and investment in training local graduates. It's not working. Most Gulf Arab rulers have found breaking a culture of easy-come government jobs and preparing their citizens for the private sector difficult. Qataris, about 16 percent of the country's 1.7 million people, still represent just 5 percent of the country's private-sector workforce, government statistics show. Locals fill about one percent of private-sector jobs in the United Arab Emirates. Saudi Arabia, with its large native population, has mustered a 10 percent participation rate. "We need to share in the private sector," says Noora Al Bedur, a director of the UAE's Emiratization program. "The private sector is the backbone of a country's economy. And citizens have the right to work in this field. That is very important for us." NEW STRUGGLES Gulf Arabs have come to expect a nice government job as part of what Ingo Forstenlechner, an Austrian academic at the United Arab Emirates University, calls the region's ruling bargain: the rulers give you everything, but you don't ask for anything. "It's basically buying political acquiescence while distributing the oil wealth," Forstenlechner says. That worked fine as long as government jobs were available. But in places like Saudi Arabia -- official unemployment is 10.5 percent, though diplomats and analysts say the real figure is likely to be higher -- state jobs are no longer guaranteed. In Kuwait, 12,000 nationals are waiting for government posts. That's left young people frustrated. In an extremely rare public protest in late August, around 200 unemployed Saudi university graduates crowded in front of the education ministry in Riyadh carrying posters with slogans demanding government jobs and posters with slogans like "Enough Injustice." Experts say unless unemployment is tackled, protests may increase -- adding to security risks. "The great majority of those recruited for terrorist activities are the unemployed," says Mustafa Alani, of the Gulf Research Center. "The (Saudi) government believes that the question of unemployment is a major problem with huge implications on security." WHY BOTHER? Part of the problem is that many Gulf nationals still don't see the point of seeking work in the private sector. In countries such as the UAE, where modest palm frond homes were replaced by glittering villas and skyscrapers in a generation or two, the government says most people are jobless by choice. Official statistics show 23 percent of Emiratis are unemployed -- a rate similar to the Gaza strip. "These are strange economies -- they're economies that went from being rather poor and undeveloped to overnight having huge amounts of oil money invested in them," says Paul Dyer, a fellow at the Dubai School of Government who specializes in labor and political economy. Khalid al Mutawaa, a 26-year-old Emirati who until recently worked as a project manager for an international bank, says the transformation has not been easy. "I think the older generations ... weren't ready for such a huge boom," he says, relaxing after work at a lounge in Dubai's beachside Ritz Carlton resort. "But I don't think the young people here were really ready for it either. UAE nationals have a very home-oriented environment. They see family as the priority." 1 2 3 4 Next World Add a Comment *We welcome comments that advance the story directly or with relevant tangential information. We try to block comments that use offensive language or appear to be spam and review comments frequently to ensure they meet our standards. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. © Copyright 2010 Thomson Reuters Editorial Editions: Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom United States Reuters Contact Us Advertise With Us Help Journalism Handbook Archive Site Index Video Index Reader Feedback Mobile Newsletters RSS Podcasts Widgets Your View Analyst Research Thomson Reuters Copyright Disclaimer Privacy Professional Products Professional Products Support Financial Products About Thomson Reuters Careers Online Products Acquisitions Monthly Buyouts Venture Capital Journal International Financing Review Project Finance International PEhub.com PE Week FindLaw Reuters on Facebook Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests. NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

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