The problem of contracting companies has worsened with the scarcity of labor and the high wages, until the problem doubled than what it was before the Corona pandemic, especially after the increase in demand for workers with the start of the delivery of building permits for more than 25 thousand housing units in the areas of Al-Mutla’a, South Abdullah Al-Mubarak and Southern Khaitan and as a result the citizen is the one who suffers both mentally and monetarily.
The managers of construction companies stated that the labor market is in chaos in the absence of supervision and added what he called many “street contractors” work individually without the presence of any legal entity, municipality classification, or commercial headquarters, pointing out that several cases in the courts were generated as a result of fraud operations against citizens or Breach of contracts, reports a local Arabic daily.
The CEO of Rikaz Contracting Company, Khaled Al-Malki, said that on March 14, 2021, building permits were delivered to the areas of Al-Mutlaa, South Abdullah Al-Mubarak and Southern Khaitan, with more than 25,000 housing units, which caused a huge demand for labor that the local market could not absorb.
He pointed out that the delivery of building permits coincided with the Corona crisis, the total and partial ban, and the exit of about 250 thousand workers in 2020/2021, explaining that Kuwait needed at least half a million workers before “Corona”, but now it takes about 750,000 workers to fill the shortage and finds it difficult to balance supply with demand.
Al-Maliki pointed out that the wages of the average worker rose by nearly 100 percent, while that of the technical worker increased by about 200 percent, which causes a strain on the budgets of the owners of the plots, indicating that this directly caused the suspension of work in a large number of plots and the failure to complete the construction due to some workers’ exploitation of the conditions, and the lack of adequate oversight by the relevant state institutions.
Al-Maliki stated that many workers have recently turned into “street contractors”, contracting with plot owners without the presence of any legal entity, municipality classification, or commercial headquarters with the absence of oversight and follow-up, which caused chaos in the labor market, accompanied by a tightening of the Ministry of Affairs in Contracting companies’ requests to raise the number of workers they have.
Al-Maliki gave an example, saying, “(the Ministry of Social Affairs) did not allow us to bring in a sufficient number of workers from outside Kuwait to cover the needs of the company’s projects, despite our submission of papers proving that we have projects worth 8 million dinars,” adding that he submitted a request to the ministry and after a long documentary cycle that lasted about 90 days only two workers were approved, knowing that the required number is 20.
He noted that the absence of oversight on many contractors who contract with the owners of the plots without having any legal status has generated many cases due to fraud operations in which citizens have been victims, in addition to their control of prices, which strains the budget of the owners of the plots.
About what the contracting companies are doing with increases in labor wages and prices for building materials, Al-Maliki said, “The contract is conditional on the contractors, so both parties are supposed to abide by its terms, which obligated many companies to complete some work according to previous prices, despite incurring losses,” stressing the need to emphasize flexibility. The price is according to market changes in terms of materials and labor within the terms of the contract.
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