GCC workforce at risk of disruption
Most young people in the GCC prefer traditional public sector jobs over private sector employment, in search for job security and high pay. Not many of them are keen enough to explore other careers that require technical skills and innovation, such as digital jobs.
This attitude by young people towards digital jobs in the GCC is different than what is prevailing in other countries in Europe and the US.
In fact, GCC digital jobs account for only 1.7 per cent of the total workforce, compared to 5.4 per cent of EU’s workforce, or 68 percent less, according to a recent study conducted by Strategy& with LinkedIn. Middle East numbers are better, faring only 50 per cent worse.
If GCC nationals are looking for job market safety, they are not going to find it.
“GCC nationals are mostly employed in sectors at risk of disruption by new digital technologies,” says the study which was released in October 2, 2017.
The U.S. example
The US has taken several measures towards the digitization of its economy.
The 2016’s G20 Summit in China showed that among the measures taken by the US were companies’ and consumers’ abilities to freely move data.
Moreover, companies in sectors such as manufacturing or energy have allocated time, money and resources to digitize physical assets.
“This could soon begin to pay larger dividends,” said a study by Mckinsey that was released late last year.
A recent study, by Worldwide Digital Transformation Spending Guide estimates that organisations will spend around $2 trillion by 2020 on Digital Transformation Technologies.
“This dramatic shift in investment is due to the growing complexity of IT related to devices and applications and rising expectations from employees who expect their IT to ‘just work’,” it said.
“To remain competitive in the market, IT CIOs need to re-focus their IT strategy to place their digital savvy workforce at the center,” it added.
Where did GCC go wrong?
From the looks of it, when it comes to digitization, the GCC needs to undertake various new courses of action to bridge the gap with its western counterparts.
For instance, Intellectual Property Rights play an important role in coming up with innovative technology and in launching it in the market. It also plays a major role in enhancing competitiveness of technology-based enterprises.
The region’s procedures for obtaining IPR are complicated, and the process needs to be improved and unified among all GCC countries, according to a study by Marmore Mena Intelligence.
“The development of a common legal framework, its implementation and enforcement represent major challenges to the protection of IPR in GCC,” it said, while adding that legal procedures to claim compensation for infringement of rights were very complex and time consuming.
Could digital professionals in the GCC not have the necessary advanced technical skills in the digital age yet?
“GCC skills are mainly soft and managerial, whereas advanced technical skills are more prevalent in other regions,” reveals the joint study by Strategy& with LinkedIn.
It claims that if the GCC properly adopts the necessary measures, it can create 1.3 million digital jobs by 2025, of which 700,000 would be in Saudi Arabia.
It added that the GCC education system did not keep up with technological changes or provide the adequate level of information, communication, and technology (ICT) education.
According to the study, only 7 per cent of GCC graduates are enrolled in digital studies at universities, versus 64 per cent in the US and 37 per cent in the UK.
It also noted that GCC digital professionals had skills that did not meet quality standards, required by the global digital job market.
“Equally, employers do not offer internships or apprenticeship programs for graduates and do not have on-the-job training to ensure continuing skills upgrade and enhancement among current employees in the field.”
Importance of digitization
The digital market could add $95bn per year to the Middle East’s annual GDP by 2020, McKinsey reports.
“Digital transformation could generate $16.9bn in extra revenue each year for companies in the Middle East in the next 5 years, as well as a further $17.3bn in annual cost savings and efficiency gains,” said a 2016 report, published by the Global Manufacturing and Industrialisation Summit (GMIS) and conducted by PwC, a global advisory.
The drive forward towards digitization
Samer Bohsali, partner with Strategy& said that the GCC governments needed to continuously reskill their workforce to embrace the latest technologies.
“The digital sector tends to change rapidly, because of continuously emerging new technologies. Creating a digital workforce of continuous learners is key to drive the success of national transformation plans,” he explained.
Strategy& and LinkedIn note that GCC nationals should be motivated at a young age to explore digital careers. “This could be achieved through awareness campaigns in schools and universities, as well as competitions, hackathons, and boot camps,” it said.