Overview
The GCC labour market presents a unique structural challenge: a dual market where nationals predominantly work in the public sector with generous compensation and benefits, while the private sector relies heavily on lower-cost expatriate labour. Every Gulf state is grappling with how to increase national participation in private-sector employment without undermining business competitiveness. The approaches vary from quotas and fees to incentives and skills development, with mixed results across the region.
Oman’s Position
Oman’s labour market challenge is acute. Approximately 42 percent of the workforce is Omani, with nationals concentrated in government employment. The Omanisation programme mandates minimum national employment percentages across private-sector industries, ranging from 15 to 90 percent depending on the sector. Youth unemployment (15-24 age group) has been a persistent concern, estimated at 13-15 percent. The education-employment mismatch means many graduates lack the technical skills or vocational training that private employers require. Government remains the employer of choice for most Omanis due to higher salaries, shorter hours, and greater job security.
Regional Comparison
All GCC states face similar dual labour market challenges. Saudi Arabia’s Nitaqat programme is the most comprehensive nationalisation scheme, using colour-coded compliance categories and escalating fees on expatriate workers. The UAE’s Emiratisation programme combines quotas with financial incentives. Bahrain’s Tamkeen fund supports skills development and employment subsidies. Kuwait mandates high nationalisation rates in government but has made limited private-sector progress. Qatar’s small national population makes the challenge differently proportioned but no less real.
Trajectory
Oman’s National Employment Programme targets sustainable private-sector employment creation for nationals. Key reforms include wage support programmes (subsidising the gap between public and private sector pay), enhanced technical and vocational education, entrepreneurship support, gig economy regulation, and sector-specific workforce planning. The government has also raised private-sector minimum wages for Omanis and strengthened enforcement of Omanisation quotas. Success requires cultural change alongside policy change – making private-sector careers aspirational rather than a fallback option.