Why Companies are not Employing Nationals
The very low percentage of Emirati nationals in the private sector is explored from the employee’s perspective and the employer’s perspective. There are several reasons Emirati nationals are not seeking work in the private sector. First, some argue that nationals view themselves as a “natural middle class,” and therefore will normally only accept work consistent with these expectations (Morris 2005: 7). These workers mainly expect comfortable white-collar jobs in managerial roles, regardless of their qualifications for the positions (World Economic Forum, 2008).
Therefore retail and service sector industries “are unlikely to suit the aspirations of nationals” (DBM Arabian Gulf 2006: 4). Thus one of the main challenges the UAE government is facing is encouraging nationals to take up manual or technical jobs and jobs in the private sector (Wilkins 2001). Secondly, Emirati nationals generally find many of the private sector’s working conditions unacceptable, due to the long and irregular hours, restrictions on time spent on cultural and religious observances, short periods of leave, and a disciplined approach to employee performance (Abdelkarim and Ibrahim, 2001).
On the other hand, the public sector is very attractive because of the salaries and working conditions. Overall, compared to the private sector, the public sector offers higher salaries (Godwin 2006, Nelson 2004, Wilkins 2001), shorter and more flexible working hours (Nelson 2004, Harry 2007, Wilkins 2001), better work conditions (Godwin 2006), better career development prospect and training and promotion (Al-Ali 2006), and better non-monetary benefits (Nelson 2004). Private sector employers are not too keen to employ nationals either for a variety of reasons.
First, private sector firms have long-standing negative perceptions of nationals’ levels of productivity, skills, and motivation and being more expensive than non-nationals (Gulf 2007, Nelson 2004). Al-Ali (2006, 2008) also reports that low levels of fluency in English and low levels of trust are barriers to workforce participation. Second, employing expatriates is cheaper than hiring nationals because the salary expectations of nationals are higher than those of the immigrant workers and therefore the price of expatriate labour is generally much cheaper than that of national labour (Gulf 2007, Morris 2005).
Additionally, “the UAE has minimum wage provisions that apply only to nationals and employers must make mandatory pension contributions to the State for each of their Emirati employees” (Ballinger 2007: 3) and therefore it costs more to employ Emiratis. Finally, Harry (2007: 138) argues that “the formal or informal rights of the nationals compared to alternative candidates cause employers to avoid recruiting them.
” Al-Ali (2008: 366) sums it up: Highly flexible and outcome-driven private sector organisations, rapidly expanding, that for decades imported their resources immediately and with impunity, do not readily consider themselves vehicles to nurture citizens of a fledgling state. Public sector organisations which comply to the desires of job-seeking Emiratis with working conditions and nurturing environments are over-staffed and ineffectual in dictating terms to the private sector.