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A recent hike in the rate of unemployment in the United Arab Emirates has been stirring rare expressions of public discontent. The UAE hasn’t publicly released unemployment figures, and figures from different international organizations vary, however one World Bank estimate suggests that the unemployment rate increased from around 1.6% in 2016 to 5% in 2020.
In January 2014 the UAE introduced mandatory military conscription for 18 to 30-year-old men. The Federal Authority for Government Human Resources announced that Emiratis who had completed their national service would be given priority in hiring and promotions. However, in June 2014, the price of crude oil began a steep decline that extended well into 2016. Despite notable economic diversification efforts, the UAE’s gross domestic product growth rate dropped from 4.6% in 2014 to 2.1% in 2016. As part of a Gulf Cooperation Council agreement, the UAE and Saudi Arabia each introduced a 5% value-added tax to help their economies recover from the fiscal deficits caused by the crashing oil prices. As a result of the unforeseen oil price crash, many of the UAE’s ambitious projects were stalled, and by the time the first batches of employed, self-employed, and unemployed Emirati men had completed their military service, they rejoined a society, and a new job market, slowly recovering from a barely publicized recession, which triggered a delayed peak in the rate of unemployment.
Who is Unemployed?
Just like in the rest of the Gulf region, numbers are hard to come by in the UAE. The last census was conducted in 2005, and all demographic data since is estimated. The 2020 figures published by the Federal Competitiveness and Statistics Centre surveying the labor force provide a breakdown based on age and educational attainment. The highest percentage of unemployed individuals were those who hold a bachelor’s degree or equivalent, with unemployment disproportionately affecting women. Per UAE laws, and prior to the announcement of the new visa regulations coming into effect in September, male expatriates could not be sponsored by their parents after their 18th birthday. As such, male residents who were 18 and older had two options to extend their residency: enroll in a local university or join the job market. Given that the residency status of nonnational men is tied to their ability to secure a sponsoring job, the percentage of unemployed male undergraduate degree holders is likely predominantly comprised of Emirati nationals, with the female percentage slightly skewed since female nonnationals continue to be sponsored by their guardians past the age of 18 and are hence included in the figures.
Visa rules announced in April introduced a new entry permit for individuals seeking employment in the UAE. The job seeker visa will allow graduates from the top 500 globally ranked universities to reside in the UAE for up to six months, in a similar practice to other talent-seeking countries. But in a country where citizens constitute a shrinking minority, Emiratis were understandably dismayed by this policy, particularly since the majority of federal universities attended by Emiratis do not rank in the top 500, which will put their skills to the test against those of job seekers trained by more prominent institutions. The invitation for those who are actively seeking employment to try their luck in the UAE will likely reflect on the unemployment rate, which has become sufficiently alarming prompting the government to introduce a form of social insurance that will provide financial assistance to unemployed individuals for an undefined but limited period of time. The announcement, however, did not specify the eligibility criteria for the social insurance and whether it would only be provided to citizens, which for a government trying to move away from a welfare model, seems to be the more likely scenario.
Unemployment in Context
When the UAE recently signed $10 billion trade deals each with Turkey and Israel, Emiratis wondered in their customary meme fashion about the sluggish response to the growing unemployment problem, given the apparent availability of funds. Moreover, the January announcement by the undersecretary of the minister of finance that VAT revenue had reached $26 billion caused further confusion for a constituency that increasingly perceives any form of taxation affecting their incomes as an “income tax.”
Following Russia’s invasion of Ukraine, already high oil prices surged. While reporting on earlier declines in oil prices and their effects on the local economy were generally toned down to avoid conveying bad news, the soaring prices were headlined with pride. But Emiratis, along with their fellow Gulf citizens, saw no positive effect on their personal incomes. In fact, gas prices have continued to increase, and citizens have reacted to the news with a mix of humor and lamentations. Calls to spend wisely, cut back on luxuries, and ration consumption became the balm to soothe the jitters of an uneasy post-oil transition – a transition occurring against a backdrop of a dizzying array of sociopolitical changes.
Transitions are never easy and should ideally be spearheaded in times of economic prosperity as a cushion against public backlash. A 2011 article published in a local English paper contemplated the usefulness of introducing a “volunteer national guard” program. In passing, the article mentioned the potential negative economic effects of conscription, which removes individuals from the job market or delays others from entering, consequently leaving a vacuum to be filled by the foreign talent the UAE has been vying to attract. What the article had failed to predict – or possibly downplayed – was the speed at which a skills deficit could arise, much to the detriment of Emirati citizens.
In a 2004 essay, David Goodheart argued that “sharing and solidarity can conflict with diversity,” particularly in situations where diversity is perceived as undercutting “a limited set of common values and assumptions” or social compact. This is apparent in the UAE today, where individuality and cultural diversity are celebrated in the spirit of hospitable tolerance until they are not. When concessions made to newcomers begin to be perceived as overwhelming the hosts and infringing on their values, intolerance begins to fester.
2020 was a particularly challenging year for Emiratis, not only because the global pandemic had hit hard, but mainly due to the concomitant sociopolitical changes from which Emiratis are yet to find some respite. The successive changes, starting with the normalization of relations with Israel, took Emiratis by surprise. Soon after, presumably unrelated economic changes were announced; one scrapped the need for foreign investors to have a local sponsor – an arrangement that had previously provided a source of tolerance-inducing revenue for private citizens. Not long after, the UAE revealed that it was introducing a list of extended forms of residencies, including citizenship, to investors and skilled foreign workers. Furthermore, the UAE embarked on major legal overhauls to decriminalize alcohol consumption and cohabitation between unmarried individuals. While Emiratis are averse to publicly critiquing decisions made by the political leadership, many were affronted by what was perceived as a violation of local cultural codes and the mores of a Muslim society. A growing number of Emiratis, however, welcomed these changes. To them, it signaled a shift toward a more open society that will protect their individual freedoms in ways that align with their liberal sensibilities. But their enthusiasm is frequently stunted by the growing sense of insecurity over being crowded out of the job market.
Disgruntled citizens have found convenient scapegoats in the “Emiratization managers” toward whom blame has been directed for their presumed inaction to absorb the large number of graduates who are actively seeking employment. Despite the apparent shortage in jobs, the repeated invitations extended to “foreign talent” enticing them to make the UAE their home has prompted Emiratis to question in social media posts why they are not considered sufficiently skilled to fill the unadvertised, but seemingly available, jobs.
News recently broke about neighboring Oman’s intention to introduce an income tax in 2023. This led many Gulf citizens, including Emiratis, to express concerns via social media about the implications of such a change, and whether it will come with more transparency and the possibility of political participation. Concerns about unemployment exacerbated these worries about the impact of a possible income tax.
That unemployment is at the forefront of Emirati discussions, especially at a time of rising inflation, increasing taxes, and the state’s growing interest in attracting skilled foreign workers, suggests it is a unifying matter that could motivate people to break the unspoken rule of keeping up appearances. With the absence of discreet, secure, and effective channels through which Emiratis can communicate their collective grievances, social media has become the only viable means through which to express discontent. Low unemployment rates seem to represent the baseline of gains that many citizens in the Gulf states are unwilling to jeopardize. With increasing unemployment and the introduction of taxes, Gulf citizens are beginning to ask questions about their economic future.
is a sociologist of culture, politics, and higher education in the Arab states of the Gulf.
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