2021
DOI: 10.1080/00036846.2021.1922590
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Sectoral employment analysis for Saudi Arabia

Abstract: This study aims to explore the impact of output and wage on labour demand in Saudi Arabia at sectoral level. We applied cointegration and equilibrium correction methods to the time-series data of 10 sectors over 1995-2016 using the demand side framework and considering the structural breaks in the data. We found that in the long run, the employment is positively affected by the output while the impact of the wage was negative in all sectors. In the short-run, employment growth in all sectors reacted to the wag… Show more

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Cited by 14 publications
(7 citation statements)
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“…This is because the utilities sector is generally less labor intensive than the agricultural sector, even though the latter is not labor intensive in Saudi Arabia compared with global averages. For example, in their sectoral employment analysis, Hasanov et al (2021) estimated that in the long run, a 1% increase in income leads to a 0.42% increase in employment in the utilities sector, while this elasticity is 0.93 for the agricultural sector. They find that the short-term income elasticities of employment are 1.98 and 0.55 for agriculture and utilities, respectively.…”
Section: Resultsmentioning
confidence: 99%
“…This is because the utilities sector is generally less labor intensive than the agricultural sector, even though the latter is not labor intensive in Saudi Arabia compared with global averages. For example, in their sectoral employment analysis, Hasanov et al (2021) estimated that in the long run, a 1% increase in income leads to a 0.42% increase in employment in the utilities sector, while this elasticity is 0.93 for the agricultural sector. They find that the short-term income elasticities of employment are 1.98 and 0.55 for agriculture and utilities, respectively.…”
Section: Resultsmentioning
confidence: 99%
“…Saudi Arabia’s native employment in the construction sector increased by 34 percent compared to the 14 percent growth rate of foreign employment since the announcement of Nitaqat in 2011–2013 (HKS, 2015). Consequently, the share of foreign employment in the sector declined to 87 percent by 2017 (Hasanov et al, 2021). Moreover, it was also easier for the construction companies to adopt technology and automation replacing low-skilled migrant workers, apart from the aggressive recruitment of native workers to meet the Nitaqat range.…”
Section: Resultsmentioning
confidence: 99%
“…Almost 80 percent of employment in the wholesale and retail sector was occupied by migrant workers in 2011 (Baldwin-Edwards, 2011). It declined to 77 percent by 2017 (Hasanov et al, 2021). Although our MANOVA significance test failed for this sector, it accounted for the second highest average number of high-skilled migrant jobs lost to Nitaqat after the construction sector.…”
Section: Resultsmentioning
confidence: 99%
“…On the other hand, levies were imposed on expatriates and their dependents from around mid-2016. The initiative for reforms in labour market has slowly augmented the share of Saudi citizens in the private sector (Hasanov et al, 2021). There has been a growth in the Saudi citizen employment within private sector by an average of 8 per cent annually, from 2005 to 2017, and at the same time, an increase of an average 4 per cent was noticed in the Saudi citizen employment in the public sector in the period aforementioned.…”
Section: Structure Of Labour Market In Saudi Arabiamentioning
confidence: 99%