By Javid Hassan, Arab News Staff

RIYADH, 14 October — Unemployment rate among Saudi males increased from 6.8 percent in 1999 to 11.9 percent this year, while the number of jobless among Saudi females in 1999 was 15.8 percent, a new study shows.

The study, conducted by Brad Bourland, chief economist of Saudi American Bank, was based on the 1999 data released by the Central Department of Statistics (CDC) of the Ministry of Planning in September this year, as well as Samba’s own estimate of the current employment situation

According to the study, unemployment rate among Saudi males in the 20-24 age group stands at 26.4 percent, but tapers off to 0.9 percent in the 30+ age group.

The Samba study also revealed that the average annual compensation package for Saudis during the year 2000 was much higher (SR84,516) than for non-Saudis (SR28,248).

The wage and compensation data for Saudis revealed that it was three times that of non-Saudis with the same level of education.

Replacing foreign workers with Saudis in the private sector at current wage differentials “would mean higher expenses for companies, which would reduce profits, increase inflation in the form of higher costs passed on to consumers, or both,” the study says.

For companies to hire Saudis at compensation levels set by the market, it continues, Saudi wages would have to decline or immigration policy change to limit the number of foreign workers.

The study points out that Saudi Arabia has the lowest labor participation rate in the world, defined as labor force as a percentage of the total population.

As Bourland points out, unemployment means “the percentage of jobseekers not working, not the percentage of the overall working age population not working.”

He adds that “we expect the labor participation rate to be low for Saudi Arabia given its large demographic youth bulge and low participation of females in the workforce.”

-- Anonymous, October 14, 2002