Labour costs soar in Saudi Arabia after migrant exodus

November 9, 2013

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Riyadh, Nov 9: Saudis have begun complaining of surging labour costs following the exodus of a million foreign workers, although economists insist there will be long-term planning benefits from fully regulating the market.

Professionals in the kingdom, both Saudi and expatriate, say the freelance tradesmen who used to queue for odd jobs in public squares have virtually disappeared since police patrols began the strict enforcement of tough labour laws this week, rounding up thousands of illegals for deportation.

They have been forced to turn instead to authorised service companies, which charge double the rate or more to hire out electricians or plumbers.

“I had great difficulty finding a carpenter even at a higher price,” complained primary school teacher Majed Hasan.

“I have been told that freelance carpenters have disappeared. I went to a services company and was told that they can provide me with a carpenter for 150 riyals ($40) — double what I used to pay.”

From Monday, the authorities began rounding up thousands of illegal foreign workers following the expiry of a final amnesty for them to regularise their work status in the kingdom.

Those considered illegal range from overstaying visitors and pilgrims who seek jobs, to shop assistants and day labourers working for someone other than their official sponsor, a requirement in Saudi Arabia as in most other Gulf states.

Nearly a million migrants — Bangladeshis, Filipinos, Indians, Nepalis, Pakistanis and Yemenis among them — took advantage of the amnesty to leave the country.

Another roughly four million regularised their situation by finding employers to sponsor them but in so doing virtually emptied the market of cheap freelance labour.

“I usually find a plumber quickly. This time, I’ve roamed three areas and I couldn’t find a single one,” complained Mahmud Badr, an Egyptian doctor who lives in the kingdom’s commercial capital Jeddah. He said he was shocked by “how service workers vanished, after they were so easy to find” queueing in public squares for the chance to earn a few dollars.

Companies employing low-paid foreigners have to pay for a permit to recruit their staff, in addition to recurring fees for annual residency permits, making their charges far higher than those of freelance illegals.

“It has been so difficult to find a worker since the crackdown began,” complained Saudi Abu Maher, as he haggled with an electrician about the price to fix his satellite television receiver.

“If you find one, it is tough to agree a deal because he asks for a high price... The cost of labour has doubled over the past two days.”

But Saudi economists insist that the short-term hit to the pockets of professionals will be outweighed by the longer-term benefits in terms of more efficient planning of the Arab world’s largest economy.

“This will have a negative impact in the short term, but it will positively affect the economy in the medium and long term,” said Fawaz Al Alami, a onetime head of the Saudi team that negotiated the kingdom’s accession to the World Trade Organisation in 2005.

“Most of the departing workforce represent an oversupply in the market,” he said.

“Had the market needed these workers, their status would have been regularised.”

Economist Ihsan Bu Hulaiga said the existence of the large pool of illegal workers had long been an obstacle to efficient planning.

“The flushing out of illegals will ... help in controlling the grey economy,” Bu Hulaiga told Saudi daily Arab News.

“Once illegal expats are sent back home, we can enumerate the total strength of the legal workforce in the kingdom, what they do and which cities they are based in. This will be relevant to analyse and formulate business policies for the future.”

Expatriates account for a full nine million of the oil-rich kingdom’s 27-million-population.

The lure of work, even in low-paid jobs as domestics or construction workers, has made it a magnet for migrants from Asia as well as poorer countries in the Arab world.

But despite it huge oil wealth, Saudi Arabia has an unemployment rate of more than 12.5 per cent among its citizen population, a figure the government has long sought to cut.

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News Network
October 26,2024

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Iran’s air defense force has confirmed Israeli attacks targeting positions in Tehran, Khuzestan and Ilam provinces, saying the aggression was successfully thwarted. 

The Zionist regime launched its strike against Iran early Saturday, weeks after the Islamic Republic’s massive ballistic missile barrage on Israel, with the Zionist military saying the “precise strikes” by the Israeli Air Force targeted strategic military sites — specifically drone and ballistic missile manufacturing and launch sites, as well as air defense batteries.

The Iran's integrated air defense system successfully intercepted and countered the act of aggression. 

“Despite the previous warnings of the officials of the Islamic Republic to the criminal and illegal Zionist regime to avoid any adventurous action, this fake regime attacked parts of military centers in the provinces of Tehran, Khuzestan and Ilam this morning in a tension-causing action,” the air defense force said in a statement on Saturday morning.

The attacks caused limited damage in some locations and the dimensions of the incident are under investigation, the statement added.

Earlier, security sources said the loud sounds heard by some people in the vicinity of Tehran were due to the activation of air defense systems.

Iran’s official IRNA news agency cited a security source as saying on Saturday morning some of the sounds heard in the capital were caused by “defense activity in Tehran.”

The news agency said there were no reports of incidents that required assistance and that the situation at Mehrabad International Airport and the Imam Khomeini International Airport was “normal.”

IRNA said Iranian air defenses “successfully shot down adversarial targets in the airspace around Tehran province.”

Footage shared online captured what appeared to be interceptions over the Iranian capital.

Tasnim News Agency reported on Saturday morning that the situation was normal at Imam Khomeini International Airport and Mehrabad Airport.

No missile strike or impact occurred on Islamic Revolution Guards Corps (IRGC) military centers in the west and southwest of Tehran, the agency reported.

According to information obtained by the news agency, there has been no impact on IRGC military centers in the west or southwest of Tehran.

The sounds heard are related to the army’s air defenses engaging Israeli military actions in three areas around Tehran.

Informed sources told Tasnim that Iran is ready to respond to Israeli aggression, "as previously stated."

"Iran reserves its right to respond to any form of aggression, and there is no doubt that Israel will receive a proportional reaction to any action taken."

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October 28,2024

Fines of up to 300,000 Saudi riyals (approximately Rs 68 lakh) or imprisonment for up to five years will be imposed on anyone found guilty of abusive behaviour in workplaces, schools, or places of worship, the Saudi Public Prosecution announced in a statement on its official account on X (formerly Twitter).

The Public Prosecution emphasised that any harmful actions in these environments constitute a criminal offence, reiterating the importance of enforcing the Protection from Abuse Law.

The statement underlined the nation's commitment to ensuring a safe and secure environment for all, as part of broader efforts to protect individuals from violence and abuse.

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October 27,2024

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The death toll from the overnight Israeli aggression against a number of military positions across Iran has risen to four.

Earlier the Iranian Army had announced the martyrdom of two of its forces in the Israeli attack, who lost their lives “while confronting the projectiles of the criminal Zionist regime in order to safeguard the security of Iran and prevent harm to the Iranian nation and interests.”

Media reports identified the two martyred Army forces as Major Hamzeh Jahandideh and Sergeant Mohammad-Mehdi Shahrokhifar.

Major Sajjad Mansouri and Sergeant Mehdi Naghavi, who had been injured in line of duty, also succumbed to their injuries, reports said.  

The strikes targeted parts of military sites in the capital Tehran as well as the western and southwestern provinces of Ilam and Khuzestan, with Iran’s air defense saying the attacks were “successfully intercepted and countered.”

The attacks caused “limited damage” in some locations and the dimensions of the incident are under investigation.

Despite Israeli media reports overplaying the Israeli attack by circulating fake images, the Iranian public returned to their routines and daily life continued smoothly across the country.

Iran’s Civil Aviation Organization announced that flights had resumed after a short interruption and footage from Mehrabad Airport in western Tehran showed operations running normally, with passengers moving through as usual.

The Tehran Oil Refining Company also dismissed rumors of an Israeli attack on its facilities.

On October 1, Iran responded to the Israeli assassination of Hamas political bureau chief Ismail Haniyeh, Hezbollah Secretary General Sayyed Hassan Nasrallah, and senior IRGC commander Abbas Nilforoushan by launching as many as 200 ballistic missiles toward the occupying regime’s military and intelligence bases all over the occupied Palestinian territories.

Dubbed Operation True Promise II, the retaliatory strike dealt a severe blow to the illegal regime all the more ruinous than its prequel in April, with Tel Aviv having so far declined to reveal the extent of loss it suffered despite vowing to respond on several occasions.

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