Kingdom tipped to remain dominant player in GCC construction, despite low oil prices and recruitment slump
Saudi Arabia is pressing ahead with $200 billion of construction projects over the next two years, according to one projection, despite the impact of low oil prices and evidence of a recruitment slump.
The kingdom is “likely to remain the dominant construction market in the GCC for the foreseeable future”, according to a statement quoting a Saudi government agency and the regional business intelligence firm MEED.
Ibrahim Al-Moaiqel, director general of the Human Resources Development Fund (HRDF), said the pipeline of construction projects is likely to create more employment opportunities for Saudi nationals.
“This development is expected to spur continued growth among stakeholders in the kingdom’s construction market, especially for local businesses,” he said. “Equally important, as the sector develops, more employment opportunities should open up for Saudi nationals and further contribute to the country’s continued push for economic growth.”
HRDF was established to intensify Saudisation – or the employment of Saudi nationals – within the private sector.
It has joined forces with MEED to organise the first-ever Saudi Talent in Construction Conference, which hopes to encourage discussions on talent-development programmes in the sector. The conference will take place on December 6 at the Intercontinental Hotel Riyadh.
Colin Foreman, editor of MEED, said the Saudi construction market was still buoyant.
“A recent industry report says overall employment across the GCC is still on the rise, despite the fall in oil prices and its subsequent effect on regional economies. Saudi, however, is pushing through with its investment plans in the construction sector so that should mitigate any slowdown felt in other sectors,” he said.
“Interestingly, the same report says the construction sector is forecast to have the highest average salary increase at 10 per cent, which will hopefully encourage more Saudi nationals to take on jobs in construction projects that are expected to get underway in the kingdom.”
There is however other evidence pointing to a slowdown in recruitment in the Saudi construction market. Online job postings in the sector fell by almost a fifth in the year to October, amid a wider slowdown in Middle East recruitment growth, according to figures published in November by jobs website Monster.com.
Engineering, construction and real estate employers advertised 18% fewer Saudi-based jobs last month compared to a year ago, making it the country’s worst-performing sector, according to the Monster Employment Index.