THE TIMES KUWAIT REPORT
Youth represents a dynamic cohort and a positive force for ushering in social and political change, and are considered as crucial assets in the economic development of nations. Countries with a large young working age population, relative to those who are not working, have the potential to realize what economists refer to as a ‘demographic dividend’ — a period in a nation’s history marked by accelerated rate of economic growth and prosperity.
However, this dividend is not a given, and could easily become a future liability. Without proper policies, an increase in the working-age population may very well lead to rising unemployment that could fuel economic, political and social risks. In order to reap a projected demographic dividend, countries will have to make the necessary investment in the health and education of youth, supply them with the right tools to upskill their capabilities, and provide them with opportunities to engage in productive employment or entrepreneurships.
Youth, defined as those in the 15 to 24 age group, who are healthy, educated and fully engaged are not only more resilient in the face of individual and societal challenges, but can also prove to be critical in overcoming intergenerational poverty and bringing about economic prosperity to countries. Despite the importance of this cohort of the population, too many young people in too many places still grapple with poverty, inequality, discrimination and rights violations that prevent them from acquriing the skills needed to realize their aspirations or achieve their full potential.
In Kuwait, where young nationals represent around 17 percent of the Kuwaiti population, the government has often said, but less frequently shown, it is keen to foster the health and education of youth, and that it is committed to providing them with opportunities for productive engagement. Just last week, ahead of this year’s UN World Youth Skills Day on 15 July, the government reiterated this commitment to nurturing youth and ensuring their well-being.
In a statement last Thursday, official spokesperson for the Public Authority for Manpower (PAM), Aseel Al-Mazyed, said that as part of the government’s ‘Towards a Safe Childhood’ campaign, business owners who employ juveniles between the ages of 15 and 18 would be obliged to adhere to several conditions of youth protection, including that they should not be employed in industries and professions that are dangerous and harmful to their health and well-being.
She added that other stipulations imposed on such businesses include that the working hours of juveniles should not exceed six hours per day, a break of one hour should be given after four hours of continuous work, and that it is forbidden to employ juveniles in work on rest days or holidays, or to engage them in work from 7pm to 6am. She urged businesses to comply with these stipulations aimed at protecting young workers so as to avoid being subjected to legal accountability.
Also, in late May, the Secretary General of Kuwait Supreme Council for Family Affairs Khaled bin Shalfoot stressed Kuwait’s keenness in enabling and empowering youth. He was speaking on the sidelines of the First Arab Forum for Equality 2022 (AFE-2022), organized by the United Nations Economic and Social Commission for Western Asia (ESCWA), and held under the theme of ‘Towards inclusive youth employment in the Arab region’.
In her keynote address to the forum, former Kuwaiti lawmaker and current ESCWA Executive Secretary, Rola Dashti said that the Arab world is among regions in the world that suffers the most from inequality. Pointing out that there are segments of society that are deprived of proper opportunities, including women, youth, people with disabilities, and displaced people, she added, “Youth unemployment is widespread in the Arab world, and the 26 percent unemployment in the region is among the highest in the world.”
Estimates by the United Nations suggest that globally more than 600 million new jobs will have to be created over the next 15 years to meet youth employment needs. In Kuwait, where young nationals and children below the age of 15 represent nearly half of the Kuwaiti population of 1.5 million, the need to prioritize the creation of new jobs has never been higher.
Data made available by the Central Statistical Bureau show that around 17 percent of the Kuwaiti population in 2021 were young nationals in the 15 to 24 age group, while Kuwaiti children below the age of 15 accounted for a further 30 percent. Finding new jobs to absorb the quarter-million young citizens poised to enter the labor pool in the coming years, as well as generating another half a million jobs over the next decade to cater to nationals currently under the age of 15, is likely to prove a herculean task for the government.
Creating new jobs or coming up with innovative and acceptable initiatives to absorb youth entering the labor pool each year, are not the only worries for the authorities. They will also have to seek innovative ways to equip these young nationals with the requisite skills and confidence to succeed in the workplace, whether as employees or as entrepreneurs. In this regard, in April 2017, the Ministry of State for Youth Affairs (MoSYA), in cooperation and coordination with the United Nations Development Programme (UNDP), launched an initiative to promote and support the empowerment of Kuwait’s young men and women.
There is no denying that this initiative did lead to the ministry realizing some improvements in its working, as well as in its interactions with youth and their development. But, as with most other high-profile endeavors launched in the country, there has been very little, if any, attempt made to implement many of the project’s recommendations on improving youth skills, or providing them with access to upskilling tools or productive employment opportunities.
Estimates by the World Bank and other statistical reviews reveal that Kuwait’s youth unemployment rate — the share of youth in the labor force who are available for and seeking employment, but remain without work — was close to the regional average of 26 percent in 2021. This was far higher than the country’s 3.7 percent unemployment rate for the working age population as a whole. On the other hand, the youth employment rate, which refers to the share of youth in the labor force in 2021, was only around 19 percent. Though not insignificant, it was still far lower than the 68 percent youth employment rate in Qatar, the 43 percent in the UAE, or the 37 percent in Bahrain.
One reason for the low youth hiring rate in Kuwait, has been the government’s employment policy that has been in place since the country gained independence in 1961. The welfare state that emerged on the back of new-found oil wealth, and the enormous surplus revenues accumulating in state coffers, led the government to introduce an employment policy that guaranteed secure and lucrative jobs in the public sector for all working age citizens in the country.
However, with the government’s influence over employment options limited to state enterprises, continuing to guarantee employment for all nationals has become increasingly challenging over the years. Nevertheless, compelled by political and social necessities to continue the policy, the authorities have resorted to creating superfluous vacancies in public sector enterprises to match the number of job applicants each year.
This untenable and flawed employment policy, with the government serving as the employer of first and last choice for most nationals, has led to a lopsided and fragmented labor market, distorted labor allocations, and created an educational process that is out of sync with market demands. It has also resulted in a bloated public sector and an engorged public wage bill that today accounts for over 70 percent of the government’s annual budget expenditure.
The realization that continuation of a flawed employment policy that is neither practical nor sustainable, appears to have dawned on policymakers only in recent years. But repeated attempts by the government to amend this policy and introduce more pragmatic measures have been vociferously and strenuously opposed by lawmakers in parliament. The prevailing policy is not only unsustainable, it is also not conducive to creating new job opportunities or initiatives aimed at absorbing youth entering the labor pool annually.
But then, most youth entering the labor market each year prefer to sit-it-out and await an appointment in the public sector, rather than seek employment in the private sector or engage in entrepreneurships. In mid-June, Director of the Public Authority for Youth Dr. Mishaal Al-Rabee, in a bid to cajole youth to join the private sector, issued a directive that young nationals seeking employment in the public sector must have work experience in the private sector.
Speaking on the sidelines of a meeting organized by the authority in coordination with other government agencies, representatives of local banks, the Chamber of Commerce and the World Bank, Al-Rabee said, “We are trying to secure jobs for our youth with rewarding salaries in the private sector that are higher than those offered in government agencies.” How far this policy will prove successful remains to be seen, with the private sector remaining reluctant to hire nationals, who often demand higher salaries and offer lower productivity relative to expatriate workers.
In the meantime, Kuwait could try implementing this year’s UN World Youth Skills Day theme of ‘Learning and Skills for Life, Work and Sustainable Development’. Industry experts point out that any youth upskilling initiatives for youth should focus on developing a quality education base, implementing targeted vocational training programs in sync with market demands, and providing youth with access to digital training and online upskilling courses that are crucial to their learning and career advancement.
To further its upskilling initiative, the government could seek assistance from global vendors of technological solutions who are offering software to students and educators in the region. These training software leverage digital platforms to help future-skill youth, and enable them to cope with the barrage of advanced technologies and workflows that are accelerating change in existing industries and careers, as well as introduce them to opportunities in new careers.
Critics of the government’s flawed employment policy have long warned that a pampering welfare state that provides citizens with cradle-to-grave care has led to an entitlement mentality among many young nationals, who believe and expect the government to continue providing them with secure, sinecure jobs. They appear oblivious to the fact that such jobs may not be available any longer, and that a day of reckoning is drawing near.