GRM 2010 GRM 2011

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GCC Labor Market, Education and Generation Y: A match or a mismatch?
Paper Proposal Text :
The aim of this paper is to analyze the convergence between the current state of education, labor markets preparedness and expectations of the Generation Y taking Bahrain as a case study. Generation Y is defined as the group of people aged 30 years and under. Although Generation Y is a worldwide phenomenon and members of this generational group share certain characteristics globally, in GCC they display a strong pressure to succeed, a need of gaining high salary but also acquiring knowledge and expertise and a preference for a strong work-life balance. In addition, in the workplace they seek peer orientation of the superiors rather than sheer respect for hierarchy; the latter is especially visible among the female population (Shoefield & Honore, 2015). The quickly modernized and globalized world created a generation with worldviews distinctive from the generation of their parents and this is especially visible in the GCC region that has been undergoing profound changes in the last decades. In addition, GCC countries are at a stage where the transformation of their labor markets remains of utmost importance. The beginning of the 21st century marked a turning point as it brought an awareness that major social and economic reforms are a must to avoid future economic decline (Shochat, 2008, p. 6). So far the GCC economies have relied heavily on oil profits; the rentier economic model (Luciani & Beblawi, 1987) has worked with oil surplus distributed among citizens in form of free services and subsidies (Hertog, 2010, p. 4). But economic constraints due mainly to failing oil prices and current demographic pressures linked to a rapid population growth call for a holistic strategy to transform the GCC economies and societies. As in the near future the likely dwindling oil wealth will have to be divided among a larger population, there will be considerable pressure on states\' budgets to maintain the same level of social welfare (Gause, 1997, p. 67) or to rethink currently fiscal policy in particular taxation. These demographic considerations are combined with a long-term need for economic diversification and gradual shift away from oil dependency (World Bank, 2004, p. 42). The drive towards a greater sustainability requires substantial economic contributions of the society. However, within a rentier context, majority of citizens display \"low societal capacities\" (Hertog, 2010, p. 5), which translate into low productivity and high expectations from state resources. Moreover, population of GCC presents specific characteristics compared to the rest of the world. More than 40% of the region\'s population are under 15 years of age (de Boer & Turner, 2007 : 10). As these youth enter the labor market, the GCC national workforce is expected to increase by 30% in 2020 (Shediac et al., 2010, p. 2). In the past, national workers would be easily absorbed in the public sector where their jobs would be secured indefinitely. At present, they are already forced to compete for jobs in private sector as the public sector is already saturated with nationals. This poses a problem for GCC labor market since foreign workers who dominate the private sector offer better skills and have lower wages expectations (Kapiszewski, 2006, p. 13). In addition, the expectations that Generation Y carry from their workplace are an additional factor to put in the picture. Indeed, there seems to be a critical mismatch between educational attainment, skills acquired and labor market expectations. Data from Ernst&Young Report suggests that lack of appropriate skills, among others, becomes a major deterrent in a broader participation of nationals in the skilled workforce. Moreover, students prefer humanities than technical fields of study that are most needed on the job market. Thus, those who graduate do not possess adequate skills and competency levels to compete with expatriates in the private sector. On the other hand, employment in the private sector is rising and as the private sector looks to expand, while the number of jobs created in the public sector has been stagnating since years. Consequently, the GCC have already begun facing the problem of youth unemployment (Kabbani & Kothari, 2005, p. 4) and structural unemployment, which is unemployment “by choice” (McKinsey&Company, 2007, p. 6). Education and innovation could pave the way to the region\'s sustainability by promoting a shift from oil to knowledge-based economy (Hvidt, 2011, p. 51). However the region\'s human capital assessment falls significantly behind the world average. UNDP\'s Arab Human Development Reports and the two Arab World Competitiveness Reports (2002-2003 & 2005) stressed that education, research and development are weak in the region, and that education systems lack relevance through systems focusing on inputs rather than outcomes. This serious shortage \"exacerbates other problems associated with importing both foreign workers and technologies\" (Davis & Hayashi, 2007, p. 2). The World Bank\'s report, The Road Not Traveled: Education Reform in the Middle East and North Africa highlights the fact that despite major investment, the MENA region achieved minimal results in the education. The latter were witnessed in international educational assessment tests such as TIMSS, PISA and PIRLS, whilst at higher education graduate employability is a key metric often cited.
This paper will focus on the educational and skill preparedness of the GCC nationals to enter the post oil labor market and future prognoses related to the labor market evolution and human capital development. We will take a holistic outlook at the intersections of the generation Y, labor market and human capital in GCC. By conducting survey based research and structured interviews with graduates under the age of 30, we will be able to gain insight into their experiences and more importantly gain from an end user perspective what needs to be put in place in terms of structural reform in order to improve employability chances for generation Y. This paper will adopt a qualitative in depth-interviewing methodology. The purpose of the in-depth interviews, “is to understand themes of the lived daily world form the subject’s own perspective” (Kvale, 1996, p. 27). Qualitative interviewing aids in gaining deeper understanding of the interviewee’s thoughts, experience, insights and perspectives; “we interview people to find out from those things we cannot directly observe” (Patton, 2002, p. 341). In this research, interviews has a special significance since the research deals with experiences, meaning construction, and interpretation, something can hardly be identified by observation alone