Dubai’s labour policy toward guest workers: a pattern to follow?

The way the Emirate grew up within a few decades seems unrealistic. Indeed, the small fishing village became one of the most appealing cities on this planet with its freshly built outrageous skyscrapers telling an uncontested success story. The 829.84 m Burj Khalifa, tallest building in the world, is the proof that the only limit remains the sky. According to its remarkable wealth, even though it has also been severely hit during the 2007-2010 crises, Dubai is still draining talent from all around the world.

As a consequence, in 2012, the population of about 2 million inhabitants has four times as many foreigners as locals. Most of them are from India, Pakistan, Bangladesh or Philippines, and they work in many different fields. Indeed, Dubai provides good job opportunities for citizens from underdeveloped or developing countries. The “kafala” system allow these guest workers to obtain legal entry in the United Arab Emirates, it is to say a three years work permit with a hypothetical renewal. The willing of working in Dubai as an expat is often led by a genuine desire to improve the conditions of living of families stuck in the home country. This is why the UAE is one of the largest remittances sending country in the world (about 12% of India’s total remittances come from the UAE).

However, if Dubai seems to be really open to foreign workers and successful with it, this has to be moderate: the system known as “Emiratization” gives preference for nationals. The “Emirati” have thus strong advantages through minimum quotas of national workers in the enterprises hiring more than 100 employees (i.e. businesses have to be 51% Emirati-owned in Dubai main). The situation is totally different in the Free Zone where workers are allowed to move as much they want without following specific rules. The Free Zone is the most productive area in Dubai. Indeed, “the value added per worker for enterprises is anywhere from four to ten times higher than in Dubai main” (Vijaya Ramachandran in Economic growth)

However, Dubai’s labour policy toward guest workers has also some difficulties. First of all, the low-skilled workers live tenuously in camps outside the city. Their working and leaving conditions are completely different from a nationality to another. A few scholars still point out the fact that “people, nationalities and jobs exist in silos, isolated from each other” (Nesrine Malik in the Guardian). Nevertheless, the government promised to act for the improvement of the unskilled workers’ living conditions. Then, the local labour force became used to the protection they benefit from the government. Here has to be highlighted the threat of losing competitiveness due to these comparatively high standards working conditions. Thus, it has been decided by the Ministry of Labour that local workers will have to compete with foreign workers. Another decision that has been taken is to improve the education and qualification of “Emirati workers” in order for them to reach a level similar to guest workers. Last but not the least, Dubai will have to focus on high value-added manufacturing to avoid the saturation of the service sector in terms of jobs providing.

As it had been said, the flourishing economy drains qualified and unqualified workers from all corners of the world. Living in Dubai has become a solution for many to escape from their home country’s suffocating labour market. The attitude of the Government of Dubai remains open toward guest workers as they dramatically contribute to wealth creation. The debt crisis that reached the country a few years ago seems to be a part of past and Dubai back on the way to growth. Despite a bunch of issues Dubai will have to face, it seems that the former sleepy village has found a viable way of managing a national labour market.

Antoine Haouy About the author

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