According to EY’s report ‘How will the GCC close the skills gap?’, employers struggle to retain nationals due to high salary expectations; however, these employers rank young people’s lack of work experience (53 percent), communications skills (36 percent), and required skills and qualifications (22 percent) as further challenges to retention in the private sector. Three quarters of GCC employers feel the education system doesn’t know what skills employers need.
The report indicated that the top three priorities for GCC students when taking a job are money, job security and work-life balance. Almost three-quarters of GCC students put salary packages at the top of the list of what they consider very important in a job, followed by 59 percent citing job security as very important.
The survey of students and employers across the GCC was designed to identify the major challenges that employers face in hiring and retaining nationals, as well as the attitudes of young people toward employment. The results showed that there is a fundamental misalignment between the expectations of both sides.
Gerard Gallagher, MENA Advisory Services, EY, says:
“Despite the efforts in the Gulf region to improve the education systems, there remains a misalignment of the needs of employers and the expectations of young people, that makes it hard to improve outcomes. Employers struggle to find the skills they need, especially at entry level, and young people in schools, colleges and universities are unclear about how they should enter the job market and build a long-term career, and teachers are unsure about labor market demands and why they are important to incorporate into the curricula they teach. “
Need for private sector employment for nationals
In the UAE and Qatar, only 1 percent of the private sector workforce is made up of nationals. In Saudi Arabia, the figure is 18 percent, the highest in the GCC.
Will Cooper, Partner and MENA Government Social Infrastructure Leader, EY, says:
“There is an urgent need to get more GCC nationals working in the private sector. The old model of employing nationals in high-paying government jobs is no longer sustainable; budgets are strained and government businesses struggle to become more efficient. It has an impact on the private sector too, which relies heavily on expatriates for its workforce.”
If the GCC is to employ the fast-growing number of young nationals entering the labor market and remain competitive, it needs to create more jobs in the private sector — but just as importantly, it must ensure that nationals have both the motivation and the skills to fill them.
Growing skills gap
In the GCC, the growing skills gap is particularly urgent for two reasons. Firstly, youth unemployment is already high and secondly, the social and financial incentives provided for nationals to take secure and well-paying public sector jobs have reduced the motivation to develop private sector skills and the experience that would help develop them.
EY’s survey of students and employers across the GCC shows that, outside of Bahrain, GCC students show an overwhelming preference for public sector jobs.
“This mind-set has to change to stop the unemployment rate escalating in the medium to long term, and to enable the successful diversification of the economy away from dependence on oil and gas revenues. The priority now is to prepare and equip young people for the workplace before they become job seekers, ensuring alignment between education and training and employers’ needs,” comments Gerard.
Four keys to success to fill the skills gap
There are four key areas where the private sector, education system and government can work together to bridge the gap between what the economy needs and the skills and attitudes that students currently learn: aligning curricula with employers’ needs, providing information about careers, developing the workforce through experience and training, and encouraging a culture of employment, innovation and entrepreneurship. The private sector will need to get involved in schools, colleges and universities, talking to students, providing advice and forming partnerships to help develop curricula and work experience schemes.
“Only through collaboration between the private sector, educators, investors, employers and young people, can governments be sure to transform its youth bulge into a demographic dividend. GCC governments have begun to tackle the skills challenge and invest in education for the growing numbers of young nationals; but there is now an urgent need to focus spending on initiatives that can realign the expectations of young people with the rapidly evolving needs of employers. The education sector will need to adapt curricula and balance practical skills and academic knowledge relevant to the current and future job markets. A vital aspect of this is an emphasis on critical thinking. This will ensure that the workforce of the future has the necessary skills, and attitudes, for employment,” says Will.