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Lack of skilled Saudis takes the shine off gold trade

By DIANA AL-JASSEM Saudization in gold and jewelry shops reached 100 percent in 2003 following a royal decision issued by the then Interior Minister Prince Naif. The Nitaqat system recently issued by the Ministry of Labor defined a Saudization rate of 70 percent in the gold sector. The decision led to misunderstandings, with many businessmen thinking they could decrease Saudization with 30 percent in their gold shops. However, traders confirmed to Arab News that the Saudization rate in companies and factories is 70 percent, but gold shops have to remain fully Saudized.

Back in 2003, many traders complained about the decision, saying it was difficult to find qualified Saudis to handle precious metals and stones. To solve the problem, Saudi traders and businessmen decided to open an institute to train youth in all skilled jobs related to the manufacture and sale of gold and jewelry.

However, despite the continuous training courses held to boost skills of Saudi salesmen, traders still have no trust in them.

Mohammad Azzouz, general manager of Azzouz House for Gold and Jewelry and member of the National Committee for Precious Metals and Stones, was one of those who criticized Saudization, saying that it prevented improvement in the Saudi gold industry. "Saudization of the gold sector also weakened the sales of gold because of low experience in the field," he said.

According to Azzouz, most traders were busy hiring Saudi nationals who were fresh in the field. As a result, he said, the development of the market stagnated over the past nine years, leading to what he called "uncreative products."

Not only Azzouz criticized the Saudization of the gold sector. Majdi Al-Rayes, a former member of the gold and jewelry committee at the Jeddah Chamber of Commerce and Industry ( JCCI ) and former CEO of several giant gold and jewelry companies in Saudi Arabia, confirmed that full Saudization was a necessity, but that the strategy of hiring should be changed.

"We are supporting Saudization of the gold sector to 100 percent, but we need to hire qualified Saudis. Most Saudis who are working in the gold sector are not professional," he said, adding that hiring Saudis should be implemented with a special strategy. "For example, the gold and jewelry sector could hire 20 percent of Saudis every year, who should be trained for several months."

According to Al-Rayes, most hired Saudis are not talented in the field of promotion and sales. "We have hired many Saudis, but they don't know most types of precious metals and stones. Their lack of experience has led us to lose huge amounts of money. Precious metals and stones and gold is a big science that must be studied very well," he said.

Another point Al-Rayes mentioned is that most Saudi salesmen refuse to work more than eight hours divided into two shifts. "They prefer not to work at night, in contrast to expatriate salesmen, who are ready to work longer hours as they don't have families here in the Kingdom," he added.

Jamil Ali Farsi, a leading Saudi businessman, writer, and head of the JCCI gold and jewelry committee, confirmed that Saudization in the gold sector remained 100 percent, although it had been decreased to 70 percent in the big companies and factories. "Nitaqat requires each company to achieve 70 percent of Saudization, meaning that gold companies and factories are allowed to hire 30 percent of expatriate employees. This rate includes designers, accountants, managers, and workers," he said.

"However," he added, "in shops Saudi salesmen will stay in their positions, as full Saudization is a must there."

Farsi stated that accusing Saudis of not being qualified is not a reason to decrease the rate of Saudi salesmen in gold shops. "Many blame Saudis for not being qualified in promoting products and for not being aware of the precious metals, stones and gold industry. However, such problem could be solved when we organize training courses for Saudis to learn more about the industry," he said.

He continued, "Another reason traders prefer not to hire Saudis is that they don't want to work long hours. The solution would be to unify work hours to eight in the private sector. All countries in the world have defined the work hours to eight, after which the worker can go home and enjoy social activities."

According to Farsi, Saudi salesmen are also blamed for getting higher salaries than their expatriate colleagues: "This is true. Saudis receive a salary between SR5,000 to SR8,000, but we all know that Saudi citizens spend this money in Saudi Arabia, which develops the national economy. In contrast, expatriate workers spend the money in their countries of origin," he said.

Farsi stressed that most traders complained that Saudis work temporarily in the private sector and suddenly leave to the government sector once they get an opportunity.

"This negative phenomenon must be solved by the Ministry of Labor itself, as the government sector should not hire any Saudi employee unless he presents a 'no objection certificate' from his boss in the private sector," he said.

Farsi said there was no doubt that the Saudization experience succeeded in different sectors, such as banking, SEDCO and Aramco. This successful experience must be generated as well in other sectors, such as clothes, cosmetics and mobile phones.

© Arab News 2012