Economic briefing
Unlike other Middle Eastern countries Kuwait has failed to diversify its economy and reduce its dependence on oil. Petroleum makes up more than half of the nation’s GDP, 92% of its export revenues and 90% of government income, leaving the economy vulnerable to fluctuations in the global oil market. In 2017 the government approved draft Bills supporting a Gulf Co-operation Council VAT scheduled to take effect in 2018, aimed at reducing its reliance on the sector.
Demographics
Kuwait’s Public Authority for Civil Information estimates the country’s total population in 2017 stood at around 4.4 million. Immigrants are said to account for roughly 69% of the demographic, including other Arab (27.9%), Asian (37.8%), African (1.9%), and other (1.1%), based on 2013 figures. Non-Kuwaitis represent the vast majority (60%) of the labour force. Paul Robertson-Marriott, interim HRD Europe at Envigo and former VP of HR for Kuwait Energy, explains that the economy needs the expertise of expats to help it evolve, but “every few years the country tends to have a purge where it then asks these expats to leave”.
Legal lowdown
The government’s Kuwaitisation policy aims to replace the expat labour force with domestic labour in the public sector, and to ensure Kuwaitis fill more roles. As part of national law it is a legal obligation for organisations to consider Kuwaitis first for certain sectors and positions. In early 2018 the government began talks with trade unions around also creating more jobs for Kuwaiti nationals in the private sector.
From the HR frontline
Attracting and retaining talent – both domestic and expat – is one of the main challenges for HR in the country, according to Robertson-Marriott. “Kuwaitisation has created a need to find a balance between what the business needs in terms of leadership and skills and the need to hire Kuwaiti nationals who perhaps haven’t got the same level of experience and expertise,” he explains.
Other recruitment challenges arise from the fact that public sector roles typically offer far higher remuneration packages than the private sector, meaning private businesses struggle to attract Kuwaiti talent. The private sector is still very much seen as developing, with 74% of Kuwaiti citizens employed by the public sector. “It’s also difficult to recruit expats to Kuwait for a number of cultural reasons: it’s a strict dry [no alcohol] state, it’s harsh weather-wise, and is much less Westernised than other parts of the Middle East,” says Robertson-Marriott.
