A Saudi banking expert, Turki al-Huqail, attributed the problem of unemployment in Saudi Arabia to the nature of Saudi government revenues which draws 88% of its share from the oil and gas sector. By its very nature, this sector is characterized by a high value added but it is not labor intensive and at best it can absorb 3% of the country's labor force.
Al-Huqail said that the contribution of the oil sector to the national economy has declined to 40% in the last 40 years and that the tourism and religious tourism sector are the only sectors, other than oil, that have potential for rapid growth.
The expert called on the government to provide an improved investment climate and proper incentives and to reform the education sector, particularly technical and vocational training. He said that of the 175,000 engineers in the various sectors of the economy only 10% are Saudis.
Source: Al-Sharq Al-Awsat, London, October 28, 2011