Question:
I am a private investor planning on opening a construction supplies dealership in Saudi Arabia. Though the market for what I have to offer is very favourable, I am not very clear on the Saudization (Nitaqat) policy. What is your advice to employers in the Middle East when it comes to hiring local talent?
Answer:
The governments of many countries in the Middle East have introduced ‘localization’ policies for the private sector. These policies stipulate what percentage of a company''s workforce should be local talent. ‘Nitaqat' in particular is a program designed by the Saudi Ministry of Labour to boost the employment of nationals and decrease unemployment. Under the program, private firms are classified into Premium, Green, Yellow and Red categories based on their percentage of Saudization.
The program sets penalties and incentives for companies based on which category they fall under. Companies with high Saudization rates will fall under the Premium or Green categories, while those who fail to achieve the required rates will be included in the Yellow and Red categories. Nitaqat ensures that Saudization rates are based on the actual performance of private businesses, and takes into consideration the sector as well as the size of work force for each company.
Apart from the Saudization, the Nitaqat program also aims to fulfil many other short-term and long-term objectives such as accelerating the employment of women, specifying minimum wage, protection of employee rights, etc. Coming to your question on hiring local talent, selecting the core team is one of the most important decisions that an entrepreneur must make in the early stages of his or her business. The core team is, after all, the initial framework on which structure of the company can be built. Here are some things you might want to keep in mind during the hiring/selection process:
1. Understand the Labour Law and track it:
It is important that you have your ear close to the ground when it comes to governmental labour policies - keep track of them through government website as often as possible.
2. Define your company and set a clear talent development plan:
Before hiring, there are several things that are essential to ensuring that your hires are strategic. Start by defining your company culture (mission, vision and goals), set business development strategy, and put in place a talent development plan. These items will help potential candidate understand the company background and assess whether they will be the right person for the job. There cannot be enough stressing on the importance of drafting clear job descriptions and requirements for candidates. This will help your internal recruiters or outside consultants get started on finding you the right candidates.
3. Use the right resource to find local Saudi talent:
Online recruitment has revolutionized the recruitment landscape for both employers and job seekers in the Middle East. For employers, online recruitment offers quick access to qualified CVs and advanced screening tools. Our own Bayt.com page for employers in KSA offers all the required information on Nitqat, as well as access to over 326,000 CVs of Saudi professionals.
4. Retention of top talent:
Finally, once you have screened and hired the best talent you need to retain it. In order to emphasize on retention, company leaders need to work hard on communicating that their company is a good work with. Regular training programs, opportunities for employee recognition, and company activities can help keep morale high.
On a closing note, Saudi employers should be aware of the salary scales in the KSA to ensure that their compensation programs remain competitive.
