Low-skilled expat workers in Middle East worst hit as hiring drops 50% over coronavirus

DUBAI: The labor market in the Middle East has been severely impacted by the coronavirus disease (COVID-19) pandemic, leaving millions of expat workers with no choice but to pack their bags and leave.

Hiring activity has dropped by 50 percent from 2019, a Gulf Talent analyst told Arab News.

In Kuwait, about 1.5 million expat workers are expected to leave the country by the end of 2020 due to the economic downturn after the state forced companies to cut their workforce.

The expats, who “are either illiterate or can merely read and write,” were not the country’s priority, Kuwait’s Assembly Speaker Marzouq Al-Ghanem said.

“While some officials in Kuwait have echoed these sentiments, political gridlock in the country’s parliament has thus far prevented decisive movement on the labor front. However, political momentum for labor market reforms that reduce the number of expatriates in Kuwait seems to be gaining speed,” Dr. Robert Mogielnicki, resident scholar at the Arab Gulf States Institute in Washington, told Arab News.

In Saudi Arabia, 1.2 million expat workers are also expected to leave the Kingdom this year, according to the Jadwa Investment Company’s latest figures.

In Egypt, it is estimated that one million of five million Egyptians working in Arab countries - especially in the GCC - will be terminated by the end of 2020, local daily Egypt Today reported citing the head of Expats Employment Unit at the Chamber of Commerce Hamdi Imam.

He added that Saudi Arabia - which has three million Egyptians working in it - has suspended multiple mega projects. And in Kuwait, he added, many Egyptians do not have contracts as they are irregular workers and carry expired residency permits, causing them to leave the country.

Low-skilled workers in the Gulf region will struggle the most when it comes to securing their jobs. They depend on actions taken by governments to address the socioeconomic concerns of citizens, Mogielnicki said. The higher-skilled employees have deeper socioeconomic networks and more labor market flexibility, he added.

Wages have also dropped significantly, causing applicants to expect much lower salaries than prior to the outbreak. In February 2020, jobseekers anticipated their next job would offer them an average wage of 14 percent more than their previous job but in today’s market, the average salary payment expected is just 2 percent higher, Gulf Talent analyst said.

In June, job opportunities in the UAE began to slightly increase, yet they still remain lower than the levels seen before the closure of schools in March, a report by Gulf Talent said.