Gulf Economies: Plebeians Keeping Up with the Potentates, the Self-employed Speculators and the Unemployable……….
“Unemployment among Emiratis in the capital city has reached 14 percent, and a range of measures like better education and teaching nationals the value of working in private companies may be introduced, according to senior Government officials. There will also be a shift away from a floundering quota system for hiring Emiratis as more of them become qualified to take on private jobs, with a greater focus on the quality of Emiratis hired instead of their proportion in companies. There could also be subsidies for private sector companies that hire Emiratis. The announcements were made at yesterday's Emiratisation Employers Forum 2010, which brings together Government officials in charge of Emiratisation policy, like the Abu Dhabi Tawteen Council (ADTC) and the Abu Dhabi Education Council (Adec), as well as private sector employers. The forum ends today………”
Traditionally, most eligible “native” workers in the Gulf region are employed by the public sector. The public sector does not fire people in hard economic times, and very few work for the private sector that would fire people in hard times. The private sector all over the Gulf prefers cheaper foreign labor. There are some exceptions, but this is a general rule in most Persian Gulf states.
This only means that many of these recently unemployed natives did not work for either sector: many of them worked for themselves, as speculators. They speculated in real estate and stocks, and whatever else available. They got caught up in the spirit of speculation that often sweeps the GCC states, as the plebeians try to catch up to the wealthy potentates and their plutocrat allies. As the plebeians try to keep up with inflation. They also got caught up in debt.
Many of the potentates and the plutocrats also engage in speculation, that is why everybody else below them gets into the act. The elites are the ones who cause the worst crises: they have caused some of the largest bubbles and worst crashes in the Gulf, like Souq al-Manakh of the 1980s and Dubai of our time. When Gulf governments intervene to save “investors” it is not to save the average sap: they do it to save their own elite who get too greedy and adventurous. We saw the latest consequences of that a few weeks earlier in Dubai. Some people in the Gulf also speculate in human trafficking: importing large numbers of foreign labor then “selling” them to work for others, or setting them loose, for a fee, to freelance on their own.
Many of the native people now considered unemployed were free-lancers, a product of a wild free-for-all economy based on a culture of speculation. They were sort of like the day-traders in the USA, many of whom went bust after the tech bubble burst in 2001. Now they are considered unemployed, most likely also unemployable.
On the other hand, with natives hovering at no more than 15% of total population (mush less in Dubai), it is easy for a few collapsing firms to push unemployment quite high.
Cheers
mhg
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