Saudi labor force figures on the rise before pandemic

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Regional economies have been hit by the double whammy of the coronavirus and weak oil prices which has forced major employers to lay off staff throughout the Gulf. (AFP)
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Regional economies have been hit by the double whammy of the coronavirus and weak oil prices which has forced major employers to lay off staff throughout the Gulf. (AFP)
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Updated 08 July 2020

Saudi labor force figures on the rise before pandemic

  • Trend driven by increase in female employment, but second quarter data will reveal impact of virus on jobs

RIYADH: Saudi unemployment dipped below 12 percent in the first quarter for the first time in four years — but the government data does not reflect the impact of the coronavirus COVID-19 pandemic.

The Labor Force Survey published by the General Authority of Statistics (GASTAT), which was conducted in January 2020, before the pandemic, showed that the total unemployment rate amounted to 5.7 percent in the first quarter, unchanged compared to the first quarter of the previous year.

Regional economies have been hit by the double whammy of the coronavirus and weak oil prices which has forced major employers to lay off staff throughout the Gulf and led to the departure of thousands of expatriate workers.

Last week the International Labor Organization warned the outlook for the global jobs market in the second half of 2020 was “highly uncertain” and that employment was unlikely to return to pre-pandemic levels this year. 

“The estimates have revised upwards considerably the damage done to our labor markets by the pandemic,” said Guy Ryder, ILO director-general.

The Saudi unemployment rate decreased to 11.8 percent in the first quarter of 2020, from 12.5 percent the same period in 2019, and compared to 12 percent in the last quarter of 2019. 

The figures also reflect an increase in the total labor force participation rate to 58.2 percent in the first three months of 2020, a jump of 1.8 percentage points compared to the same period in 2019.

GASTAT said that the stability in the unemployment rate and the increase of labor force participation rate were due to the increase in the number of employees in the survey.

That trend was driven by a decrease in the Saudi female unemployment rate that stood at 28.2 percent in the first quarter of 2020, 2.7 percentage points lower than the last quarter in 2019. 

Meanwhile the Saudi male unemployment rate rose to 5.6 percent, 0.6 percentage points higher than the rate of last quarter in 2019.

The statistics show that there are almost 9.98 million people in employment across the public and private sectors.

About 3.2 million of them are Saudis. The figures exclude workers in the security and military sectors. 

The data also reveal that there are 3.66 million domestic workers in the country, all of them non-Saudis.

The labor market statistics are compiled from two main sources. The first is the labor force survey, which is a household survey that is carried out by GASTAT and provides the most important indicators of the labor market, such as the unemployment and labor force participation rates.

The second source is administrative data which is recorded and updated by government agencies related to the labor market.


Creditors take action against Al Jaber in decade-long saga

Updated 7 min 58 sec ago

Creditors take action against Al Jaber in decade-long saga

  • The downturn in the Gulf construction sector has triggered a number of corporate restructurings as companies are forced to reschedule debt, raise fresh borrowing or enter insolvency protection

DUBAI: Creditors have started to enforce claims against Abu Dhabi-based Al Jaber Group, in a dispute triggered by a construction downturn in the UAE more than a decade ago.

Al Jaber, a contractor with interests across a range of sectors, has struggled since building up debt in the wake of a UAE real estate crisis and began talks with creditors in 2011.

Abu Dhabi Commercial Bank, which is working as restructuring and security agent, said in a document dated Sept. 21 which was seen by Reuters, that it had instructions from the majority of creditors to proceed with claims against Al Jaber.

A representative for Al Jaber did not immediately respond to a request or comment. ADCB declined to comment.

The move follows delays in restructuring agreements, under which Al Jaber was to appoint a new board and sell companies and assets such as the Shangri-La hotels in Dubai and Abu Dhabi.

In exchange, creditors had agreed to extend the maturity of a 5.9 billion dirhams ($1.61 billion) loan, cut interest rates, and provide additional revolving debt.

The initial enforcement action now being pursued by creditors includes the “acceleration and demand for payment of amounts outstanding” under the previously agreed debt restructuring, a source familiar with the matter said.

Enforcement will also allow creditors to claim against Al Jaber’s chairman under a 4.5 billion dirham loan to the company.

Several UAE companies have sought to extend debt maturities or agree better terms in recent years to avoid defaults, after an oil price crash hit energy services and construction.

The coronavirus crisis has added to the strain and Arabtec Holding, the UAE’s biggest listed contractor, this week will discuss options including dissolution after the pandemic hit projects and led to additional costs.

Meanwhile, Dubai-listed construction firm Drake & Scull is working to reach an agreement with its creditors in an out-of-court process.