An international study on migrant labour in Saudi Arabia and Kuwait suggests that the growing reliance on local workers could soon replace many jobs currently held by expatriates, particularly in skilled and semi-skilled sectors. The study, authored by Abdul A. Erumban and Abbas Al-Mejren, indicates that while migrant workers in low-skilled jobs may remain in demand for some time, automation and upskilling of local workers will likely reduce the need for foreign labour in the long run.
Local Workers Taking Over Migrant Jobs
The research highlights that as the local workforce in Saudi Arabia and Kuwait continues to upskill, even middle-skilled roles held by expatriates could soon be filled by nationals. While low-skilled jobs will continue to rely on expatriates for now, this could change with significant automation efforts in the region. The study also warns that high-skilled jobs may eventually be at risk as local workers increase their qualifications and productivity.
Long-Term Risks for Countries Like India
Dr. Erumban explained that countries like India, which send a significant number of migrant workers to the Gulf Cooperation Council (GCC) countries, face medium to long-term risks. The shift towards localising jobs, especially as upskilling progresses, poses challenges for Indian workers who rely on these foreign job opportunities. India, he noted, needs to focus on diversifying employment opportunities abroad and strengthening its domestic job creation efforts to mitigate these potential shifts.
Migrants’ Productivity Edge Over Nationals
The study reveals that migrant workers generally exhibit higher productivity than local workers in both Saudi Arabia and Kuwait. This productivity advantage, combined with lower wages for migrants, has made it difficult for firms to replace them with nationals. The wage gap, according to the study, is more a result of policy distortions than market forces, making it challenging for companies to hire locals in place of migrants, particularly in the private sector.
Construction Projects at Risk Without Migrant Workers
The study also mentions that many ambitious infrastructure projects in the region may struggle to move forward without migrant labour. However, it cautions that drawing firm conclusions about the substitution of workers at various skill levels requires further research.
As the GCC countries focus on developing their local workforce, India and other labour-exporting nations must adapt by improving domestic job creation and diversifying employment opportunities. The potential displacement of migrant workers, particularly in middle to high-skilled roles, presents a growing concern for the future of foreign labour in the region.
