Fairs make job search easier

In a cavernous exhibition hall on the outskirts of Riyadh, dozens of young Saudi women stroll between corporate booths in search of jobs.Each has completed a 3-1/2 hour aptitude test that gives her scores for 10 behavioral characteristics and two types of cognitive ability. The results are shown to as many as 81 potential employers which schedule job interviews using a centralized, online system. It is Women's Day at the first of a series of job fairs launched by the Saudi government this year to find employment for its citizens. In coming months the scheme aims to arrange interviews for 15,000 men and women out of 100,000 applicants, holding similar fairs in the cities of Jeddah and Dammam."In the past, finding a job was an uncertain process," said Mohammed Mosly, a former investment banker who manages the scheme. "We're using technology to make it predictable."Saudi Arabia's economy is booming, fueled by high oil prices and heavy government spending. Gross domestic product of the world's top oil exporter surged 6.8 percent last year, according to preliminary data, the fastest expansion since 2003; economists polled by Reuters expect growth to stay comfortable at 4.0 percent this year.But at top levels of government, there is little public complacency. Instead, officials are talking of the need to find millions of jobs for Saudis over the coming years — a challenge which will require the economy to move beyond decades of dependence on oil and state investment to stress private sector growth and entrepreneurship.Financial, legal and labor reforms are under discussion and may be introduced as soon as this year. Fresh steps are expected to encourage firms to hire Saudis in senior positions; the stock market may be opened to direct foreign investment; and there may be legal changes to stimulate the housing industry.The country has embarked on over $100 billion in new spending on welfare and infrastructure projects to maintain social stability. Because of such spending, the government needs global oil prices to average $84.50 a barrel this year to balance its budget, according to the Reuters poll, up from $73 last year and around $50 in 2007.With Brent crude oil now around $110 and the state sitting on huge fiscal reserves, there is no significant risk of Riyadh running out of money in the next few years. But in the long run, any slide in oil prices will undermine the country's finances if it cannot find new revenue sources and broaden its economy.Adding to the challenge is looming demand for jobs among Saudi citizens; as much as 75 percent of the population is under 30. Unemployment among Saudis is already about 10 percent.The government estimates the Saudi labor force will expand to 10 million in 2030 from 4.1 million in 2008 because of population growth and the entry of more women into the work force, which is being encouraged under social reforms. That means the economy will need to create over 5 million new jobs. Much of the reforming energy is going into education, where the government is working with the private sector to try to make school graduates more employable, and into a complex system of job fairs, job subsidies and regulations to push private sector companies into hiring more Saudi citizens instead of foreigners. A scheme launched last year penalizes firms if they fail to reach minimum ratios of Saudis in their work forces and rewards them if they greatly exceed those targets. Labor Minister Adel Fakieh said last week that a new version of the scheme, likely to be launched in coming months, would add targets for the minimum ratio of each company's payroll paid to Saudis — an incentive to employ locals in higher-paying jobs.But officials recognize that labor reforms by themselves cannot transform the jobs market — indeed, the targets for hiring Saudis may be hurting growth by making it harder for some companies to operate efficiently. So other reforms are being planned in an effort to jump-start private sector activity.Legal changes are under way to improve enforcement of contracts and help smaller enterprises obtain credit, Ayedh Al-Otaibi, legal adviser at the Saudi Arabian General Investment Authority, told Reuters. He said the central bank might ease some rules on loans to make lending less restrictive.The government is considering whether to open the stock market to direct foreign investment, not because listed firms need the money but because it hopes long-term investment by foreign institutions would focus the highly speculative market, now dominated by retail investors, on corporate efficiency.