Over million expats to leave Saudi market in 2020: report
Riyadh - Mubasher: About 1.2 million expat workers could leave the Saudi labour market by the end of 2020, according to a recent research note by Jadwa Investment.
Sectors, including accommodation and food services, administrative and support activities will most likely see the highest share in expat departures.
Global working hours are set to slide by 10.7% or 305 million full-time workers over the second quarter (Q2) of 2020 when compared to Q4-19, affected by the lockdown measures imposed around the world since the beginning of Q2 as the coronavirus (COVID-19) continues to spread, according to the International Labour Organisation (ILO).
However, the final number of annual job losses will depend on the development of the pandemic and the measures taken to lessen its impact.
The Jadwa report further expects the Saudi unemployment rate to remain unchanged at around 12% by the end of 2020.
As Saudi employees were encouraged to work remotely since mid-March and then stopped going to work in line with the social distancing rules, the report says that between 35% to 65% of total labour in the kingdom have stayed home over Q2-20. A situation that has led or will lead several companies to institute temporary salary cuts, terminate contracts particularly for foreign labour, or enrol Saudi workers into the Sanad scheme.
Introduced in 2014, the Saned fund will bear 60% of Saudi employees’ salaries in the private sector for three months with a total value of SAR 9 billion.
Since the beginning of 2020, approximately 323,000 workers have already departed Saudi Arabia, based on health insurance coverage of expats.
Moreover, the ILO unveiled a policy framework with four key pillars to combat COVID-19, namely stimulating the economy and employment, supporting enterprises, jobs, and income; protecting workers in the workplace, and relying on social dialogue for solutions and other measures.
It is worth pinpointing that Saudi Arabia provided a SAR 120 billion stimulus package for the private sector and reallocated 5% of the 2020 budget into the most affected sectors, such as health.
In addition, the Saudi Arabian Monetary Authority (SAMA) pumped SAR 50 billion to support the small and medium-sized enterprises (SMEs), whilst the Human Resources Development Fund (HRDF) provided SAR 5 billion to support Saudis’ employment and subsidise wages of those employed in the private sector since July 2019.
