GRM 2010 GRM 2011

Abstract Details

Family Name:
First Name:
Faisal A.
Title of Paper:
Tourism development in the Gulf Cooperation Council region: Will it really be a cure for national youth unemployment?
Paper Proposal Text :
Tourism is one of the world's largest as well as fastest growing industries and the Gulf Cooperation Council (GCC) member states are expected to be progressively more important engines of such growth. By boosting both international travel and generating increasingly vibrant regional or domestic tourism sectors, tourism promotion is often considered an integral element of economic strategies, particularly for developing nations where once prevalent primary industries are in decline. For instance Euromonitor International revealed at the World Travel Market Vision Conference in 2011 that both the United Arab Emirates (UAE) and Saudi Arabia will experience some of the world’s strongest inbound tourism growth over the next five years. Their Travel and Tourism Global Overview report forecasts Saudi Arabia to have one of the largest annual growth rates in the world which will result in an additional 9.3 million visitors to the Kingdom and a 12.3 percent increase in arrivals between 2010 and 2015. This makes Saudi Arabia the fifth largest country in terms of absolute arrivals growth over the forecast period. The anticipated growth is driven mainly by religious tourism, in particular the annual Hajj pilgrimage to Mecca and Medina, supported by infrastructure developments in air transportation and travel accommodation. By contrast, the UAE will experience an annual increase in arrivals of 6.9 percent, resulting in 3.6 million new visitors, being the 14th largest country in terms of absolute arrivals growth over the same time frame (Euromonitor International, 2011).

The sector is generally publicized as a vital source of employment, revenue, foreign exchange benefits, public infrastructure, diversification and inducement in reviving national pride. While in reality the industry primarily serves to enhance the power and privileges of local elites, policy makers in the Gulf economies often promote their surge for tourism development as a means to create employment opportunities for their citizens. Unquestionable investments in this sector tend to generate a larger and more rapid increase in employment than equal investment in other economic activities and the International Labor Organization estimates that on average one direct job within the tourism industry induces around one and a half additional indirect jobs related to the tourism economy (ILO, 2002). Since tourism creates a variety of jobs requiring different employee profiles with the majority having lower formal qualification requirements, it would be – at least in theory - the most suitable policy approach to cater to the dearth of skills among nationals in the Gulf economies. Moreover the sector has a tendency to employ younger people and those who prefer to work part-time (notably women) or temporary. At the same time, available research suggests that most workers in the tourism sector tend to earn less than workers in socially comparable occupations. Hence, despite the recurrent rhetoric of policy makers, it should be no surprise that Forstenlechner & Mellahi (2010) point out that the tourism sector in the UAE has a tendency not to employ nationals (less than 1 percent). This inclination however is symbolic for the situation in the GCC, albeit at different scale, and hence the apparent contribution to employment presented by the relevant international tourism organizations is depending almost entirely on expatriates. In other words the alleged economic benefit of tourism is significantly reduced due to an excessive dependence on foreign intermediaries, labor and products (for instance imports of equipment for construction, food and consumer goods). In other words, a fundamental gap still exists between the available national human resources and the needs of the labor market in general. When looking at the status quo, the attempts to “nationalize” the workforce should be considered, at best, incomplete successes and at worst absolute failures. At the same time unemployment especially among the youth is on the rise in all of the GCC states and the vast majority of the young unemployed never held a job before. Prevailing patriarchal structures and the redistributive policies in the region, permit youth to spend extended periods of time searching or waiting for a preferred civil service and public-sector enterprises job (Yousef, 2003). Hence, unemployment appears to be still largely ‘by choice’ due to unmet expectations on salaries and working conditions. Consequently, it is unlikely to assume that with the current structural deficiencies GCC nationals will be willing to work in the tourism sector, where they will not encounter customarily high wages, job security, generous social allowances and retirement benefits, short working hours and the ability to display a lack of work discipline.

On the other hand, a shift to sustainable tourism concepts could alleviate some of the difficulties currently associated with the employment of nationals in the globalized GCC tourism industry since it offers small-scale opportunities that require less skills (e.g. language skills). For instance the ‘alternative’ tourist that goes hiking in Bolivia, does certainly not expect the local family business that rents out rooms in a mountain village to be have any knowledge of English. In this context, tour guides, bicycle, horse or camel rentals, running minibuses or local restaurants do not require many years of vocational training and still seem to provide quite adequate services to millions of ‘alternative’ travelers in all corners of the globe. Achieving these aspirations however requires a good fit between the types of service which tourists demand and those which locals are willing to provide. Policies which prevent or discourage independent travelers are reducing exactly these opportunities for local small scale entrepreneurs, who tend to choose employment models which complement their existing livelihood strategies and thus maximize their returns. Since this is the case in most GCC countries, is the rhetoric about creating meaningful employment opportunities sincere? From both a security and sustainable development point of view, to develop a tourism industry that is dependent on foreign expertise and labor is unacceptable and should be considered a ‘development of loss’ that uses up the resources required for future generations. Hence every effort should be made to implant those nationalization policies and create the necessary awareness for the urgency of these policies.
Moreover, a sector-focused approach to sustainable tourism has recently been identified in the development of self-regulatory codes of conduct and practice. While encouraging participating members to both take a leadership role in managing sustainability issues and to build a collective identity of responsibility, the system functions by means of peer pressure and status determinants, the threat of government regulation and social perceptions. One of these codes in the GCC member states could be to advertise their businesses as “nationalization compliant”, based on relevant government media campaigns and the necessary framework conditions (labor/immigration/education). While prospects for widely-based adoption of sustainability standards in society and the private sector are expected to be dim, this approach certainly has advantages and reduced costs compared to forced compliance or litigation. Is this a feasible step in the right direction? How can the Gulf economies overcome their structural differences? When it comes to vocational training required for the tourism sector the situation looks even worse, since only Oman has so far managed to implement somewhat sustainable training. How can the private sector be involved in developing these urgently needed skills based on the German model? What if the protection of the system continues to take the upper hand over promoting capacities and skills?

The paper both assesses the current situation as well as future trends and takes forward a set of ideas for future policy priorities, while offering an exposition of the likely consequences of the contemporary deficiency of national manpower planning for the GCC tourism sector. It will also identify future human resource challenges for and paradoxes of the region, especially in view of the United Nations’ decent work agenda in the various sectors of the tourism industry. Moreover, it will take a critical look at the current policies and education initiatives, which still largely ignores the need for practical experience in form of vocational training as well as public awareness campaigns in respect to this employment sector.
Conclusions aim at highlighting that in view of the current orientation towards investment and maximum economic growth, the absence of sufficient human agency and social cohesion will lead to further dependence on foreign nationals and thus detrimental environmental, socio-cultural and security impacts.