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Sectoral and Skills Gaps Analysis

Skills Gaps Research Study: Report 2

June 2009

Report to Tamkeen, Kingdom of Bahrain

Disclaimer

INFORMATION ON WHICH THE SURVEY RESULTS ARE BASED IS REPRESENTATIVE OF THE BEST INFORMATION AVAILABLE AT THE TIME OF THE STUDY’S FIELDWORK, CONSULTATIONS AND PUBLICATION. ALTHOUGH GREAT CARE WAS TAKEN TO ENSURE DATA QUALITY, LABOUR FUND (TAMKEEN) DOES NOT GUARANTEE THE ACCURACY OR COMPLETENESS OF THE SURVEY OR OF ANY INFORMATION PRESENTED HERE.

NEITHER THE LABOUR FUND (TAMKEEN) NOR ANY AGENCY THEREOF, NOR ANY OF THEIR EMPLOYEES NOR ANY OF THEIR CONTRACTORS, MAKES ANY WARRANTY, EXPRESS OR IMPLIED, OR ASSUMES LEGAL LIABILITY OR RESPONSIBILITY FOR THE ACCURACY, COMPLETENESS OR ANY THIRD PARTY’S USE OF THE INFORMATION CONTAINED IN THIS DOCUMENT.

The Allen Consulting Group ii

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Suggested citation for this report: Allen Consulting Group 2009, Skills Gaps Research Study: Report 2 — Sectoral and Skills Gaps Analysis, Canberra, Australia.

Disclaimer: While the Allen Consulting Group endeavours to provide reliable analysis and believes the material it presents is accurate, it will not be liable for any claim by any party acting on such information.

© The Allen Consulting Group 2009

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Contents

Glossary 1

Chapter 1 4 Introduction 4

1.1 Background to the study 4 1.2 Skills Gaps Research Study 6 1.3 Methodology for this report 8

Chapter 2 11 Bahrain’s labour market and skills 11

2.1 Bahrain’s labour market 11 2.2 Sectors of the Bahrain economy 17

Chapter 3 19 Views from graduates and education institutions 19

3.1 Overview 19 3.2 Graduate survey analysis 19 3.3 Training institution survey analysis 22 3.4 Employer survey — results by size of employer 25

Chapter 4 28 Future solutions for Bahrain’s labour force 28

4.1 Overview 28 4.2 Key findings — public services 28 4.3 Key findings — infrastructure 30 4.4 Key findings — trade and other services 33 4.5 Conclusions 37

Chapter 5 40 Education 40

5.1 Characteristics of the sector 40 5.2 Education in Bahrain 43 5.3 Skills formation in the sector 47 5.4 International trends in education 50 5.5 The future labour and skills needs 52 5.6 Skills gaps analysis 64 5.7 SWOT snapshot 66 5.8 Future skills issues 67

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Chapter 6 69

Health 69 6.1 Characteristics of the sector 69 6.2 Health in Bahrain 73 6.3 Skills formation in the sector 74 6.4 International trends in health 75 6.5 The future labour and skills needs 78 6.6 Skills gaps analysis 87 6.7 SWOT snapshot 88 6.8 Future skills issues 89

Chapter 7 91 Public Administration 91

7.1 Characteristics of the sector 91 7.2 Public administration in Bahrain 92 7.3 International trends in public sector skills and skills needs 98 7.4 The future labour and skills needs 99 7.5 Skills gaps analysis 109 7.6 SWOT snapshot 110 7.7 Future skills issues 111

Chapter 8 113 Construction 113

8.1 Characteristics of the sector 113 8.2 Construction in Bahrain 115 8.3 Skills formation in the sector 116 8.4 International trends in construction 117 8.5 Future labour and skills needs 119 8.6 Skills gaps analysis 129 8.7 SWOT snapshot 131 8.8 Future skills issues 131

Chapter 9 133 Information Technology 133

9.1 Characteristics of the sector 133 9.2 Information and communications technology in Bahrain 135 9.3 IT trends in Bahrain and the GCC 137 9.4 International trends in IT 140 9.5 The future labour and skills needs 140 9.6 Skills gaps analysis 151 9.7 SWOT snapshot 152 9.8 Future skills issues 152

Chapter 10 154

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Telecommunications 154 10.1 Characteristics of the sector 154 10.2 Telecommunications in Bahrain 159 10.3 International trends in telecommunications 160 10.4 Future labour and skills needs in the telecommunications sector 162 10.5 Skills gap analysis 173 10.6 SWOT snapshot 174 10.7 Future skills issues facing the telecommunications sector 174 10.8 175

Chapter 11 176 Transport and logistics 176

11.1 Characteristics of the sector 176 11.2 Transport and logistics in Bahrain 180 11.3 Skills formation in the sector 180 11.4 International trends in logistics 181 11.5 The future labour and skills needs 184 11.6 Skills gaps analysis 192 11.7 SWOT snapshot 194 11.8 Future skills issues 194

Chapter 12 197 Business services 197

12.1 Characteristics of the sector 197 12.2 Business services in Bahrain 198 12.3 Skills formation in the sector 199 12.4 International trends in business services 201 12.5 The future labour and skills needs 202 12.6 SWOT snapshot 215 12.7 Future skills issues 216

Chapter 13 217 Manufacturing 217

13.1 Characteristics of the sector 217 13.2 Manufacturing in Bahrain 220 13.3 Skills formation in the sector 220 13.4 International trends in manufacturing 223 13.5 Future labour and skills needs 225 13.6 Skills gaps analysis 235 13.7 SWOT snapshot 236 13.8 Future skills issues 237

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Chapter 14 238

Tourism and hospitality 238 14.1 Characteristics of the sector 238 14.2 Tourism in Bahrain 241 14.3 International trends in tourism and hospitality 242 14.4 The future labour and skills needs 244 14.5 Skills gaps analysis 255 14.6 SWOT snapshot 256 14.7 Future skills issues 257

Chapter 15 258 Trade 258

15.1 Characteristics of the sector 258 15.2 International trends in trade 263 15.3 Future labour and skills needs 265 15.4 Skills gaps analysis 275 15.5 SWOT snapshot 277 15.6 Future skills issues 278

Chapter 16 280 Petrochemical Sector 280

16.1 Characteristics of sector 280 16.2 Petrochemicals in Bahrain 282 16.3 International trends in petrochemicals ⌂ 16.4 Future labour and skills needs 290 16.5 Skills gaps analysis 298 16.6 Future pressures facing the petrochemical labour market 299 16.7 Possible solutions for Bahrain 301

Chapter 17 303 Banking and finance 303

17.1 Characteristics of the sector 303 17.2 Skills formation in the sector 306 17.3 International trends in finance and banking 310 17.4 Employer survey results 317 17.5 Skills gap analysis 320 17.6 Future labour market and skills issues and possible solutions 324 17.7 325

Appendix A 326 Survey methodology 326

A.1 Baseline study review 326 A.2 Survey design 326 A.3 Data collection methodology 327

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Chapter 14 238

A.4 Employer survey 328

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A.5 Employee survey 331 A.6 Education and training providers survey 331 A.7 Graduates Survey 332

Appendix B 334 Second-tier occupation definitions 334

B.1 Second-tier occupation definitions 334

Appendix C 350 Labour market analysis — information sources 350

C.1 Sources used as part of the labour market analysis 350

Appendix D 351 References 351

S K I L L S G A P S R E S E A R C H S T U D Y — S E C T O R A L A N D S K I L L S G A P S A N A L Y S I S

The Allen Consulting Group 1

Glossary

ACCA Association of Chartered Certified Accountants APICORP Arab Petroleum Investment Corporation ASRY Arab Shipbuilding and Repair Yard Company BAFCO Bahrain Aviation Fuelling Company BANAGAS Bahrain National Gas Company BAPCO Bahrain Petroleum Company BAS Bahrain Airport Services BATELCO Bahrain Telecommunications Company BCCI Bahrain Chamber of Commerce and Industry BIBF Bahrain Institute of Banking and Finance BIC Bahrain International Circuit BIHM Baisan Institute of Hospitality Management BIHR Bahrain Institute of Hospitality and Retail BIRD Bahrain International Retail Development BLZ Bahrain Logistics Zone BTI Bahrain Training Institute CAT Certified Accounting Technicians CEPIS Council of European Professional Informatics Societies CIA Central Intelligence Agency CIO Central Informatics Organisation CMA Certified Management Accountants CPHC Council of Professors and Heads of Computing CSB Civil Service Bureau CT Communications Technology EDB Economic Development Board FMC Fixed Mobile Convergence GCC Gulf Cooperation Council GDP Gross Domestic Product GOSI General Organization for Social Insurance GPIC Gulf Petroleum Industries Company HCD Human Capital Development HR Human Resources HRDF Human Resources Development Fund IATA International Air Transport Association ICSB Independent Civil Service Bureau IEA International Energy Agency ILO International Labour Organization IMF International Monetary Fund IT Information Technology KSA Kingdom of Saudi Arabia LMRA Labour Market Regulation Authority LPG Liquid Petroleum Gas LPI Logistics Performance Indicator MOU Memo of Understanding MTM Manama Textile Mills



NOGA National Oil and Gas Authority NRI National Readiness Index OAPEC Organisation of Arab Petroleum Exporting Countries OPEC Organization of Petroleum Exporting Countries PET Preliminary English Test PRM Professional Risk Managers PTTEP National Oil Company of Thailand RCSI Royal College of Surgeons, Ireland SABIC Saudi Basic Industries Corporation SEM Structural Equation Modelling TLI-AP The Logistics Institute – Asia Pacific TRA Telecommunications Regulation Authority UAE United Arab Emirates VEGA Volunteers for Economic Growth Alliance WHO World Health Organization WTTC World Travel and Tourism Council



Part 1

Sectoral and skills gaps analysis — Overview



Chapter 1

Introduction

It should be noted by the reader that the data for the Skills Gaps Research Study was collected during 2008 with the conclusions being finalised in June 2009. This data is relevant to each of the four reports in the series of the Skills Gaps Research Study.

1.1 Background to the study

Tamkeen

Tamkeen (formerly Labour Fund) was founded in 2006 with the primary objectives of developing the private sector and making Bahrainis the preferred choice for employers. Tamkeen’s goal is to create high-value added jobs for Bahrainis.

Tamkeen’s strategy focuses on:

• capitalising and developing value added Bahraini talents and skills in

rewarding careers

• supporting the development and attraction of new and emerging industries

• enhancing and leveraging existing industries.

More recently Bahrain has taken vital steps towards comprehensive labour reform aimed to develop its human capital, support the private sector and liberalise and improve inherent market systems, standards or policies.

Successful reform of Bahrain’s labour market will affect the whole economy. In particular, it will raise Bahraini living standards by challenging private and public sector establishments to improve employment services, policies and standards and the working conditions within Bahrain.

Economy in brief

Bahrain has a long history as a regional centre for trade and commerce. In more recent times, since the 1930s when oil was discovered, the country’s economic prosperity has been based largely on oil revenues. These have been the main contributors to national income over the past half-century. Oil revenues have enabled development of extensive, high quality national infrastructure, and allowed the government to provide Bahraini citizens with services such as free education and free or very low cost health care, with minimal taxation. More recently, other industry sectors — notably banking and finance — have become increasingly important.

Bahrain’s policy makers have identified the need for longer-term investment outside the oil sector, for two main reasons.



Firstly, there are the dangers of natural resource income distorting patterns of economic development. Secondly, Bahrain’s oil resources are limited, and the government has prudently sought to develop a strategy for a future where the country will not be able to rely on oil as the major source of national income. Current economic development strategies and initiatives aim to mitigate the potentially significant impacts of this situation. Prominent among these to date, has been the successful effort to develop Bahrain as a regional provider of financial services and establish its position as a leader in Islamic banking and financial services.

Bahrain’s economic diversification strategy, shifting focus to non-oil sectors and industrial and commercial success, has been making notable progress over the last two decades. As a result, 75 per cent of Bahrain’s Gross Domestic Product (GDP) in 2007 was attributable to non-oil sectors(Central Informatics Organization 2008).

Among the economic successes of the nation, there remain some key issues that have the potential to act as barriers to future economic diversification. An example is that income inequality is high compared to other developed nations with few middle-income households and many low income households.

In addition, the labour market is expected to change significantly over the coming decade. These changes include:

• new Bahrainis will enter the labour market, many of whom will be recent

graduates (from either high-school or post-secondary studies)

• an increasing number of Bahraini women will enter the labour market

• those currently unemployed and lacking skills to enter the labour market will improve their skill base in order to participate in the workforce (Economic Development Board 2004).

Continuing the aim of economic diversification, Bahrain’s Economic Development Board (EDB) has been focussed on a sustainable future for Bahrain. In 2004, the EDB launched a comprehensive National Strategy for Bahrain to ensure future sustainability. This strategy aims to:

• re-capture Bahrain’s leadership position as the pre-eminent economy in the

region

• become the preferred country within the region to create and grow a business, by both nationals and foreigners

• achieve a more than two fold increase in income per capita by 2015 (Economic

Development Board 2005).

The strategy consists of three components, which are outlined in Box 1.1.



Box 1.1 COMPONENTS OF THE NATIONAL STRATEGY FOR BAHRAIN

Enabling the private sector: • the removal of barriers to growth such as access to capital, land, judicial and legal

infrastructures • specific sector initiat ives to accelerate growth in strategic sectors • dedicated Small Medium Enterprise (SME) initiative and investment promotion. Transforming government: • reducing red tape • moving from owner-operator to facilitator • creating a modern civil service. Investing in people: • labour market ref orm • education system reform.

Source: (Economic Development Board 2005).

The reforms aim to ensure that the private sector is the driver of future growth in Bahrain and that Bahrainis are the employees of choice for this growing private sector (Economic Development Board 2005).

Bahrain has made a strong investment in education, skills and diversification. There has been a rapid increase in educational standards since the 1980s, and at the same time a strong increase in the size and value of the services sector. However, the reliance on foreign workers to address the shortage of skilled labour during a period of rapid growth, perpetuated by mismatches between the profile of skills possessed by Bahraini nationals and those required in the labour market, is a significant issue to be addressed.

Economic observers (including the United Nations, IMF and others) have commented on the importance of resource rich nations investing in human capital. Bahrain has adopted a far-sighted program to do exactly this. This Skills Gaps Research Study is one element of that broader strategy.

1.2 Skills Gaps Research Study

Tamkeen has commissioned the Allen Consulting Group to conduct a comprehensive study to analyse current skills in Bahrain’s labour market, as well as future and emerging skills requirements, and to assess any current or projected gaps and needs.

The study aims to build on reforms in place and improve the quality and quantity of skills being developed, in order to ensure that Bahrain maintains a strong competitive economy and high quality of life.

The project will provide an information base to underpin strategies to improve labour force participation, and responsiveness to the demand for skills using a flexible, market based approach. The objectives of this project are outlined in Box 1.2.



Box 1.2 OBJECTIVES FOR THE SKILLS GAPS RESEARCH STUDY

1. To establish a detailed understanding of the current composition of the Bahraini

workforce — the deliverable at this stage will be a set of data on current labour market conditions, skills and components.

2. To provide analysis of the gaps in the current skills makeup in light of projected future demands. This will be identified on the basis of in depth analysis of the likely demands from both current employers and prospective new industry sectors.

3. To develop a strategy for overcoming such gaps. The strategy will be based on the most contemporary thinking in economics and labour market analysis.

4. Provide action plans that give clear guidance for identified priority sectors on how to implement the strategic directions proposed.

These objectives will be addressed in a series of four reports (see Box 1.3).

Box 1.3 SKILLS GAPS RESEARCH STUDY — REPORTS

Report 1: Skills Gaps Research Study: A Comparable Country Scan: This report will develop a clear understanding of the international environment in which Bahrain operates and determine Bahrain’s points of national advantage. It will also consider how other countries have aided skill development in the past. Report 2: Skills Gaps Research Study: Sectoral and Skills Gaps Analysis: This report will outline a baseline for the labour market and associated skills in eleven selected sectors, forecast the labour and skills needs for each sector into the future (assuming no predicted changes to the status quo) and identify skills gaps within each sector. It will also identify the strengths, weaknesses, opportunities and threats in terms of the labour market in each sector and associated skills gaps. Report 3: Skills Gaps Research Study: Future Skills and Workforce Needs: This report will summarise the key discussions drawn from the scenario planning exercise and the Regional Conference on Skills Gaps, conducted in Bahrain in November 2008. The report will highlight key findings that will contribute to the outcomes of the future strategy. Report 4: Skills Gaps Research Study: Final Report This report will identify the future needs of the Bahraini labour market and associated skills gaps using the information collected in each of the previous reports and incorporating economic modelling of this information. From these projections, this report will highlight a series of future scenarios that will form the base of the study’s strategy. The report will consist of a strategic skills plan for the next eight years and will include action plans that will address the future strategy.

Source: (Allen Consulting Group and Eidos).

The Skills Gaps Research Study is one piece of a broader forum of issues that relate to the labour market and skill development. For example, there are key issues on labour market reform (including skill development concessions such as the current training levy scheme), wage policy, labour laws, the education system structure and Bahrain’s inherent cultural and social values that are not addressed within the scope of this study (see Figure 1.1).



This study has been specifically targeted to identify and create strategies to address future skills gaps in Bahrain. Specifically, the Allen Consulting Group are using a definition of skill as ‘a proficiency or facility that is acquired or developed through education, training or experience’ to ensure that the study meets its objectives (see Box 1.2).

Figure 1.1

THE MANY FACETS OF THE LABOUR MARKET


The Skills Gaps Research Study builds on previous work undertaken in Bahrain on skills development, such as the skills development analysis by McKinsey & Company for Tamkeen, and Skills Gaps & Competency Requirements for the Financial Services Industry by Ernst & Young Bahrain for the Human Resources Development Fund. Although the Skills Gaps Research Study is based on a unique methodology, key findings and lessons from other research programs are considered to improve the study as a whole.

1.3 Methodology for this report

The Sectoral and Skills Gaps Analysis Report is the second report in a series of four reports. It focuses on the following sectors:

• Education

• Health

• Public Administration

• Construction

• Information and Communications Technologies

• Telecommunications

• Transport and Logistics

• Business Services

• Manufacturing



• Tourism and Hospitality

• Trade (retail and wholesale)

The report aims to:

• outline the baseline for the labour market and associated skills needs in eleven selected sectors

• inform the impact that the drivers of skills needs are having on the selected

sectors

• forecast the labour and skills needs for each of the eleven sectors into the future and identify skills gaps within each sector.

Across each of the eleven economic sectors the report:

• provides a snapshot of the nature of the characteristics of the sector and its

workforce

• looks at the international trends in sectors where this is relevant

• presents statistical information on labour market analysis

• evaluates some of the major factors that affect the availability of skilled workers in particular sectors.

In addition, chapters on the petrochemicals and banking and finance sectors have been included in this report, however, do not include the same level of detail as surveys of employers and employees within these sectors was outside the scope of the Skills Gaps Research Study. Further, only limited additional stakeholder consultations were undertaken with organisations within the banking and finance sector. These two chapters (Chapter 16 and Chapter 17) have been included for comparison purposes and should be considered outside the initial group of 11 economic sectors selected for the Skills Gaps Research Study.

The report has been influenced by the results of quantitative and qualitative analysis undertaken over the course of the Skills Gaps Research Study. The consultation process involved approximately 120 stakeholder meetings across the sectors, a workshop which focused on a scenario planning exercise for the Bahraini workforce and the conduct of a skills gaps conference attended by approximately 150 participants. This was supplemented by the quantitative results of four surveys carried out across the eleven sectors (an employer, employee, education institution, and graduate survey). The surveys are described at Appendix A of this report.

The report provides an overall picture of current skills gaps in the sectors and investigates the factors that will impact future skills needs. The skills gaps analysis includes a qualification gaps projection for 2012 identifying the shortage of specific qualifications by industry sector. On the basis of the skills gaps analysis a snapshot of the strengths, weakness, threats and opportunities for each of the sectors has been included.

Further, this report provides a labour market analysis across the 11 selected sectors based on historical labour market data and includes two forecasting components:

• the labour market forecast to 2012, based on the status quo for each sector



• an occupation analysis, which forecasts some key occupations required in 2012 in each of the 11 economic sectors based on the occupation-based results from the employer survey and the results of a labour market forecast based on the scenarios outlined and discussed in Report 4.

These results will be used in the final report (Report 4) to identify the future needs of the Bahraini labour market and the associated skills gaps. It will lead to the development of a strategic skills plan and will include action plans to address the future strategy.

It should be noted that data for the Skills Gaps Research Study across all four reports was collected during 2008 with the conclusions being finalised in May 2009.

Structure of Report 2

The remainder of this report is structured as follows:

Continuation of Part A— overview:

• Chapter 2 describes Bahrain’s labour market and skills. It considers the various

factor of unemployment amongst the Bahraini and non-Bahraini labour market and the participation of women in the workforce

• Chapter 3 provides an outline of key findings from two of the four surveys

(Graduate Survey and Training Institution Survey) conducted for the Skills Gaps Research Study

• Chapter 4 focuses on the key findings of the skills gaps analysis from each of

the eleven selected sectors

Part B — public services:

• Chapters 5 through 7 focus on each of the public services sectors individually — including education, health and public administration

Part C — infrastructure:

• Chapters 8 through 11 focus on each of the infrastructure sectors individually

— including construction, ICT, telecommunications and transport and logistics

Part D — trade and other services:

• Chapters 12 through 15 focus on each of the trade and other services sectors individually — including business services, manufacturing, tourism and hospitality and trade

Part E — petrochemicals and banking and finance:

• Chapter 16 and Chapter 17 discuss the petrochemicals and banking and finance

sectors for comparison purposes to the initial 11 selected economic sectors.



Chapter 2

Bahrain’s labour market and skills

2.1 Bahrain’s labour market

In June 2008, the labour market in Bahrain consisted of 531 249 employees (see Table 2.1). A distinguishing feature of the Bahrain labour market (as in other GCC States) is the high proportion of non-Bahraini workers — making up 74.7 per cent of the total labour force. There has been strong growth in the labour market between 2002 and 2008 (an increase in employees of 81.6 per cent), with the majority of this growth coming from non-Bahraini workers (growth of 106.1 per cent). As a result, the level of Bahrainisation in the labour market has decreased from 34.2 per cent in 2002 to 25.3 per cent in June 2008 (Labour Market Regulatory Authority 2008b).

Table 2.1 BAHRAIN’S LABOUR FORCE — 2008 AND 2002

Indicator

2008

2002 Change from 2002 to 2008

Total employment 531 249 292 536 81.6%

Bahraini 134 468 100 007 34.5%

Non-Bahraini 396 781 192 529 106.1%

Bahrainisation 25.3% 34.2% -26.0%

Note: data for 2008 is for quarter 2 only (end June 2008). Source: (Labour Market Regulatory Authority 2008b).

The total size of the labour force and its percentage of the total population (including registered foreign nationals) has implications for the types of economic activity that can be undertaken in a nation and its capacity to achieve sustained economic growth. Nations with small pools of labour from which to draw workers, generally require a high level of participation in order to achieve economic growth.

A distinguishing feature of the Bahraini labour market is its diversity, relative to others in GCC States (as discussed in Report 1). Such diversity has important implications for the types of skills that are needed in a small labour market over the coming decades. It suggests that Bahrain will require a complex mixture of broad- based skills development (to service the vocationally-orientated sectors) and technical and professional/technical skills (to meet the needs of knowledge-based service sectors) to capitalise on a diverse range of private sector employment opportunities.

As a consequence, Bahrain will need to consider skills development in the broadest possible way. To quote the influential Leitch Review into skills development in the United Kingdom:



Skills are capabilities and expertise in a particular occupation or activity. There are a large number of different types of skills and they can be split into a number of different categories. Basic skills, such as literacy and numeracy, and generic skills, such as team working and communication, are applicable in most jobs. Specific skills tend to be less transferable between occupations. Most occupations use a mix of different types of skills (Leitch 2007).

For example, Bahrain is well-renowned for its banking and finance sector — although it only currently accounts for approximately 2 per cent of total employment — and is generally seen as an attractive sector for Bahraini citizens to seek employment (Harry 2007). In order to grow the banking and finance sectors Bahrain will require a broad range of skills that include technical, professional skills (including soft skills) and vocationally-based skills (i.e. clerical skills) to be developed. These skills will also need to be transferable across the entire sector, which is a commonly-held criticism of the employment arrangements in most GCC States (United Nations 2003)

Employment of foreign workers

A distinguishing feature of labour markets in GCC States is the high proportion of expatriate workers.

Foreign workers dominate in private sector employment, both at the skilled and unskilled level. For example, at the lower end of the employment scale, almost 25 per cent of employed non-Bahraini men are classified educationally as ‘illiterate’ compared with only 4 per cent for Bahraini men. Whereas over 35 per cent of Bahraini men have diplomas or degrees compared with 30 per cent for non-Bahraini men. However, this comparison can be misleading, with many Bahraini graduates in non-technical areas. The real dominance of expatriate workers lies in their technical and managerial skills.

The Bahrain labour market in 2008 consisted of almost 400 000 non-Bahraini workers, an increase of over 100 per cent from 2002 (see Table 2.1). This information indicates the rapid growth that has taken place in the Bahrain Labour market. It shows a number of important facts:

• most employment gains have accrued to non-Bahrainis

• as a result the process of Bahrainisation has been slowed down

• the large increase in work permit renewals signifies that foreign workers have

taken on characteristics of resident workers, in terms of quasi-permanency.

Figure 2.1 provides a yearly breakdown of total employment and employment across the broad classifications of public, private and domestic sectors over the period 2002-07. Over that period the percentage of non-Bahrainis in the labour force rose from 66 per cent to 74 per cent.



Figure 2.1 ESTIMATED TOTAL EMPLOYMENT BY CITIZENSHIP AND SECTOR — 2002-07

Source: (Civil Service Bureau (CSB) 2008b; General Organization for Social Insurance (GOSI) 2008).

The process of Bahrainisation, largely driven by the employment of Bahrainis in the public sector has slowed down. While across the period Bahrainis maintained their dominance in the public sector at around 82 per cent of the workforce, private sector employment grew more rapidly than public sector employment with the result that Bahrainis lost ground in terms of contribution to the labour market.

Expatriate workers operate across the skill spectrum. They dominate the construction and heavy industry sectors by contributing the bulk of technical skills (70 per cent) and unskilled labour (over 65 per cent). However as the rapid growth in the Indian and Chinese economies has created competition for skilled labour in Bahrain (as well as the other GCC States) and has resulted in shortages in:

• structural specialists

• quantity surveyors

• planning engineers

• project directors

• design specialists

• urban surveyors.

Unemployment in Bahrain

The concept of unemployment occurs when a person who wants to work is unable to obtain a job. However, beneath this simple definition are a number of conceptual difficulties, related to job preference and reservation wage, desired working hours and spatial location of unemployment.

Unemployment data for Bahrain are superior to those available in other GCC States largely because of the Labour Force Surveys (LFS) conducted by the LMRA and the Ministry of Labour (MoL). Figure 2.2 shows data on unemployment numbers and unemployment rates by gender and split between Bahraini and non-Bahraini for the period 1981–2004. A number of features stand out:



• for Bahraini males, official unemployment rates peaked in 2004 at 12.5 per cent

• unemployment rates among Bahraini females also peaked in 2004 at 32.8 per cent

• the total (Bahraini) unemployment rate at 13.3 per cent is down from 18.5 per cent (2004) but exceeds unofficial estimates for other GCC States such as the KSA (11 per cent)

• among non-Bahraini males, unemployment is very low (0.9 per cent) but this

has traditionally been the case. The data for 2004 shows an upward movement in comparison to earlier periods

• unemployment rates for non-Bahraini females is substantially higher than

earlier periods such as 2001 and this may indicate a potentially growing problem with unemployment among guest workers (although more data points are needed to confirm this point).

Figure 2.2

UNEMPLOYMENT IN BAHRAIN — 1981-2007

Source:(Labour Market Regulatory Authority 2004; Labour Market Regulatory Authority 2007).

New entrants to the labour market

One explanation for the dominance of the young in unemployment data is the difficulty faced by new entrants to the labour market in obtaining initial work. The 2004 LFS provided data that disaggregated the unemployed into those with and without previous labour market experience.

Table 2.2

DISTRIBUTION OF UNEMPLOYED INDIVIDUALS WHO WORKED OR NEVER WORKED BEFORE — 2004

Work status Proportion

Worked before 41.6%

Never Worked 58.4%

Total 100%

Source: (Labour Market Regulatory Authority 2004)



The data in Table 2.2 shows that new entrants made up approximately 60 per cent of the total unemployed in 2004 and appears to confirm some commentary that obtaining an initial foothold in the Bahrain labour market is a contributing factor to observed unemployment. Unfortunately, no similar data are presented in the 2007 LFS to support these findings.

Duration of unemployment

The final aspect of unemployment in Bahrain relates to the duration of employment. Table 2.3 includes information on duration of unemployment. The results from the 2004 LFS (reproduced below) indicated the presence of a significant long-term unemployment problem with 54 per cent of total unemployed, 57 per cent of females and 50 per cent of males being unemployed for 13 months or more.

Long-term unemployment was a smaller problem for non-Bahrainis but the gap between Bahraini and non-Bahraini was less than in other labour market indicators.

Table 2.3 DISTRIBUTION OF UNEMPLOYED INDIVIDUALS — BAHRAIN 2004

Duration of employment

Total (%)

Non-Bahraini (%)

Bahraini (%)

Total Female Male Total Female Male Total Female Male

Less than 6 Month 22.7 19.1 26.9 35.2 32.8 39.0 20.9 16.7 25.5

7 to 12 23.3 23.9 22.7 27.9 26.2 30.7 22.6 23.5 21.7

13 to 24 23.9 23.8 24.0 18.0 22.1 11.6 24.8 24.1 25.5

Over 2 years 30.1 33.2 26.4 18.9 18.9 18.7 31.7 35.7 27.3

Total 100 100 100 100 100 100 100 100 100

Source: Derived from (Labour Market Regulatory Authority 2004).

Participation of women

A notable feature of the labour market in Bahrain has been the increased participation of females, both Bahraini and non-Bahraini, where participation is defined as the percentage of the labour force (employed plus active unemployed as a ratio of the civilian population of working age).

A number of commentators have noted the relatively low participation and level of position of women in GCC States (AL-QUDSI 1998), including such factors as low participation, occupation and segregation into lower level clerical and manual work and the service industry. For example only 1.6 per cent of women in Kuwait and 5.2 per cent in UAE hold managerial positions and 85 per cent of females in Bahrain work in the service sector. The impact of this labour market segmentation is a loss of productive labour and high allocative inefficiency, particularly in terms of education and labour market engagement.

There are social and cultural norms that impact on the participation of women in Arab society. However, theses norms have not precluded the rapid participation of women into tertiary education, where female participation (50 per cent) is significantly higher than for males (35 per cent).



The traditional nexus between educational attainment and labour force participation is creating a dynamic within the economy of Bahrain for increased participation by women and this is further strengthened by the emergence of the finance and banking sector as a growth area in the economy. So too is the policy of Bahrainisation outside of the public service, with private sector service industries expanding rapidly and male participation becoming stagnant or declining.

The changes in male and female participation rates that have occurred over the period 1971-2004 are identified in Table 2.4. For example, the share of the total labour force made up by women has risen over the period 1971-2004 from 5 per cent to 29 per cent. Further, female participation growth has occurred for both Bahraini and Non-Bahraini women.

Table 2.4 PARTICIPATION IN THE LABOUR FORCE OF BAHRAIN

1971 1981 1991 2001 2004 Labour Force Bahraini Males 35 567 50 972 73 118 94 404 101 400

Females 1811 9219 17 544 32 769 42 100

Total 37 378 60 191 90 662 127 173 143 500

Non-Bahraini Males 20 816 74 089 113 739 146 604 154 100

Females 1396 6948 22 047 33 787 38 900

Total 22 212 81 038 135 786 180 391 193 000

Share of labour force Bahraini Males 95% 85% 81% 74% 71%

Females 5% 15% 19% 26% 29%

Total 100% 100% 100% 100% 100%

Non-Bahraini Males 94% 91% 84% 81% 80%

Females 6% 9% 16% 19% 20%

Total 100% 100% 100% 100% 100%

Source: (Labour Market Regulatory Authority 2004; Labour Market Regulatory Authority 2007).

As discussed above, there are a number of drivers behind the increased participation rates for Bahraini females, including:

• increased educational opportunities and increased female participation in

higher education

• the growth of industries, particularly the financial and banking sectors, favourable to the increased participation of women

• changing social attitudes towards female participation.

The other factor required to assist female participation is to reduce the occupational segmentation of women away from a narrow concentration on service industries and away from the public service. This in turn will require both a change in social and cultural attitudes and a re-orientation in the standard educational profile of women to equip them for the emerging private sector jobs in Bahrain.



2.2 Sectors of the Bahrain economy

For the purposes of the Skills Gaps Research Study, the Bahrain labour market is being considered in two segments:

• the future labour market comprising the 11 economic sectors selected for this

study and listed in Section 1.3

• other economic sectors (including the petrochemical and banking and finance sectors) that make up the entire Bahrain labour market.

The Labour Market Regulatory Authority (LMRA) estimated the total labour market to equal 503 784 employees (both Bahraini and non-Bahraini workers) in December 2007. Of this total, 335 437 employees (around 67 per cent of the total labour force) worked in one of the 11 selected economic sectors (see Table 2.5). The remaining 168 347 employees work in other sectors of Bahrain’s economy (including the petrochemicals and banking and finance sectors.

Table 2.5 SECTORS OF THE BAHRAIN ECONOMY — 2007

Economic sector Number of employees

Proportion of total labour market

Education (public and private) 21 111 4.2%

Health (public and private) 9563 1.9%

Public Administration 14 119 2.8% (excluding public health and education)

Construction 115 582 22.9%

Information and Communications 3301 — Technologies

Telecom munications 2412 0.5%

Transport and Logistics 11 272 2.2%

Business Services 2822 0.6%

Manufacturing 63 439 12.6%

Tourism and Hospitality 23 518 4.7%

Trade (retail and wholesale) 71 599 14.2% 11 selected economic sectors 335 437 66.6% Other economic sectors 168 347 33.4% (including petrochemicals and banking and finance) Total labour market 503 784 100%

Note: ICT employees are a sub-sector of a number of other sectors (the majority being in the trade and manufacturing sectors). Source: (Allen Consulting Group and Eidos); (Labour Market Regulatory Authority 2008a); (Civil Service Bureau (CSB) 2008a); (General Organization for Social Insurance (GOSI) 2008).



Assuming the status quo, the total labour market would be forecast to equal around 694 000 employees in 2012 (excluding ICT, for which employees are scattered across a number of the other sectors). Of this total, around 473 000 employees (68 per cent of the total labour force) are expected to work in one of the 11 selected economic sectors.



Chapter 3

Views from graduates and education institutions

3.1 Overview

This chapter outlines the key findings from two surveys (Graduate Survey and Training Institution Survey) that aimed to meet the needs of the overall study to identify skills deficiencies and gaps in the Bahrain labour market. The purpose of the surveys was to collect data about the characteristics of Bahraini training institutions and characteristics and ambitions of students who are about to graduate from a range of Bahrain training institutions. This chapter also contains some overarching analysis from the employer survey, considering the differences in results across small, medium and large survey respondents.

3.2 Graduate survey analysis

A total of 270 graduates (and final year students) were surveyed as part of the skills gap analysis. Two thirds of respondents were female and around 90 per cent were born in Bahrain. As could be expected from a student population, more than half of the respondents were 20 to 24 years of age, and around 90 per cent were under 30.

The estimated monthly income of students reflects quite varied socio-economic status. Most students (61.0 per cent) reported their personal monthly income to be less than BD50. However, the results for estimated household income showed significant spread. The largest subset (27.2 per cent) of students lived in households where monthly income was more than BD1500. The next largest subsets are less than BD50 and between 1000 to BD1500 — 11.4 per cent and 11.0 per cent respectively — indicating a considerable socio-economic gap.

Educational experience

Regarding their educational experience, 72.8 per cent of respondents nominated Certificate or Diploma as the highest qualification they had completed, and another 14.4 per cent reported completing a Bachelor degree or above. It should be noted however, that not all respondents had graduated when completing the survey — some were in their final year of study.

Figure 3.1 illustrates the fields of specialisation of graduate students. It shows that more than a third of students (36.3 per cent) specialised in commerce and law, significantly more than any other specialisation. Other popular specialisations were arts and humanities (13.9 per cent), computer science (12.7 per cent) and science (11.6 per cent).



Figure 3.1 FIELDS OF SPECIALISATION, GRADUATES


Work intentions and expectations

Respondents were asked a number of questions about their work intentions and expectations following completion of their studies.

Figure 3.2 illustrates the future labour force participation intentions of graduates that responded to the survey. It shows that 49.0 per cent of graduates indicated that they were already working or planned to enter the workforce immediately after graduating. However, almost one fifth (22.9 per cent) of graduates do not plan to enter the workforce for at least two years, and another 12.2 per cent do not intend to enter the workforce at all. This represents a significant proportion of recent graduates in Bahrain who will not participate in paid employment for some time. Women were more likely to indicate a preference for quick employment — already working, starting immediately or starting within three months — than men.

Figure 3.2

INTENDED TIME BEFORE ENTERING WORKFORCE, GRADUATES




Of those graduates who plan to work when they complete their studies, just over half (53.5 per cent) intend to work in the private sector, while the remaining 46.5 per cent would like to work in the public sector, for a government-owned business, or for a semi-government organisation. Business services (37.4 per cent) was the most popular sector in which to seek employment, followed by education (18.5 per cent), public administration (14.1 per cent) and telecommunications (10.7 per cent). Less than 10 per cent of graduates sought work in each of the remaining eight sectors.

Figure 3.3 shows the intended occupations of graduates who responded to the survey. Graduates were largely seeking professional positions — around a third of graduates (31.3 per cent) intended to work as a business professional and another 16.6 per cent sought a position as a manager or business executive. Other desirable positions include education provider (14.7 per cent) and administrative services (10.4 per cent).

Figure 3.3 INTENDED OCCUPATION, GRADUATES


Most students (51.7 per cent) expected an initial monthly income of between BD400 and BD599, however 10.9 per cent expected more than BD1000 a month. Those graduates with post-graduate qualifications and/or intentions to work in highly paid sectors (construction, management and health) had higher salary expectations. In addition, graduates with some indicators of higher socio-economic status (higher income already, owning a car and having travelled within the GCC) also expected higher starting salaries.

Graduates indicated that the most frequently used method of looking for work is direct approach to an employer (51.3 per cent use often or very often). Almost half (49.7 per cent) indicated that they have used the Ministry of Labour often or very often, however a large proportion (31.0 per cent) never use the Ministry which likely reflects different desired job types. Graduates also heavily used networks of friends and relatives when seeking work (47.1 per cent).



Attitudes to skills and work

Respondents were asked how important they considered certain skills to be when applying for work. As indicated in Figure 3.4, with the exception of physical skills, more than 50 per cent of respondents rated every work-related skill as very highly important. It is important to consider that many of the respondents of the graduate survey have not yet commenced work and generally identified the majority of skills as very highly important more often than the respondents to the employee survey.

Figure 3.4 ATTITUDES: WORK RELATED SKILLS, GRADUATES


Graduates were also asked about the factors that may influence their decision to take a job. Although graduates rated sufficient income and job security highly, the most influential factors stated were opportunities for promotion, working as a part of a team, good training provisions, effective resolution of work conflicts, and child tuition coverage. Graduates responded more strongly than existing employees across most factors and in particular rated alignment with traditional beliefs and the same nationality as other employees as much more important factors than existing employees. This could suggest that graduate students hold more radical views than existing employees.

3.3 Training institution survey analysis

The survey of Bahraini training institutions (TIs) was completed by 11 organisations. Of the participating TIs:

• most were private sector organisations (63.6 per cent)

• around half were universities (45.5 per cent) and the other half colleges or

other institutions providing training services (55.5 per cent)

• over half had less than 100 employees (60 per cent).



Student characteristics

TIs were asked about their new enrolments and current students graduating in 2008 by gender and nationality. Bachelor degrees comprise most new enrolments (72 per cent). Although still the largest category, bachelor degrees comprised only 51.2 per cent of upcoming graduations. In contrast, certificate or diploma qualifications comprise 14.1 per cent of new enrolments compared with 39.2 per cent of graduations. This suggests that the popularity of bachelor degrees has increased in the previous few years, whilst certificate and diploma qualifications have decreased in popularity. Notably, TIs reported no doctoral degree enrolments or graduations.

It also appears that TIs are growing — total enrolments for the year were 7 562 compared with only 1 646 graduations. Even accounting for some students who do not complete their qualification, this represents a significant increase in student numbers.

More than half (57.3 per cent) of new enrolments across all qualification types were women, rising to 62 per cent of bachelor degree enrolments. Higher-level qualifications however were more male-dominated — 70.0 per cent of masters degree enrolments and 55.9 per cent of postgraduate diploma enrolments were men. The same trend was reflected in graduations — most (72.2 per cent) bachelor degree graduations were women whereas two thirds (66.7 per cent) of masters degree graduations were men.

Bahraini students significantly outnumbered non-Bahrainis in both enrolments and graduations in all qualification types with the exception of postgraduate diplomas. Overall, Bahrainis comprised 85.7 per cent of all enrolments and 79.2 per cent of all graduations. For postgraduate diplomas, most enrolments and graduations were non-Bahrainis — 78.1 and 67.2 per cent respectively.

TIs consistently reported that the professional skills most in demand from students were accountancy and information technology (IT) related skills. They reported that for potential employers, management skills were also in demand in addition to IT and accountancy. This suggests a possible shortage of supply in management skills as students attach less importance to this skill.

Bahraini TIs indicated that their students were most likely to find work in the business sector, ICT, the public sector, education and trade sectors. In addition, two institutions indicated that their students very often found jobs in the automotive industry and oil sector respectively. The health, transport and logistics, and tourism and hospitality sectors were the least likely sectors for students to attain jobs.

This is largely consistent with the industries that TIs target their qualifications to. Certificate and diploma qualifications, as well as bachelor degree qualifications were most likely to target the business services and ICT industries. Postgraduate qualifications and Masters degree qualifications were most likely to target business services with no other industry recording a high response rate across institutions. Doctoral degree qualifications were spread across most industries, rather than predominately targeted to a particular industry. For all qualification types, but particularly for the more advanced qualifications, health, transport and logistics, and tourism and hospitality industries were not popular.



Employment assistance

TIs play a key role in assisting their students to find work. The methods most frequently used by TIs to assist students in finding work are direct approach to employers, career counsellors and utilising work contacts or networks. This is fairly consistent with the methods identified by graduates in the graduate survey, although few graduates (17.6 per cent often or very often) reported using career counsellors to look for work.

In addition, TIs use some specific procedures and processes to engage with industry groups or employers and most (9 of 11) target specific industries. The processes most frequently used are: obtaining employer sponsorship of programs and employer linked student placements, discussing desired qualifications and skills with industry groups and potential employers and employment expositions.

Work-related skills

TIs were asked how important they considered certain skills to be for their graduating students. Figure 3.5 shows that more than three quarters of TIs rated the more ‘traditional’ skills of literacy, numeracy, management and planning skills as very important. Overall, TIs attached less importance to the skills as a group than graduates, although they rated literacy and numeracy higher. Other clearly different views between graduates and TIs are:

• TIs rated emotional skills considerably lower — no TI considered this skill to

be very important compared with 51.8 per cent of graduates

• only 25 per cent of TIs rated persuasive skills as very important compared with 63.1 per cent of graduates

• graduates rated work communication most highly (85 per cent rated it as very

important) compared with only half of TIs.

Figure 3.5 WORK RELATED SKILLS, TRAINING INSTITUTIONS




3.4 Employer survey — results by size of employer

The employer survey comprised of 804 respondents across the 11 selected economic sectors (excluding responses from the petrochemicals and banking and finance sectors). Of the total survey responses:

• 53 per cent of respondents were small employers with between 1 and 9

employees

• 35 per cent of respondents were medium employers with between 10 and 99 employees

• 12 per cent of respondents were large employers with more than 100

employees.

An overview of number of small, medium and large employers who responded to the employer survey by economic sector is provided in Appendix A.

Small, medium and large employers identified the top five skills required in the sector, which are outlined in Table 3.1. The most commonly identified skill required across all employers was communications skills (42 per cent for small employers), followed by technical skills (33 per cent for large employers). For small employers, customer service and selling skills are required, whereas for larger employers, management skills and work ethics were seen as more important skills.

Table 3.1 TOP 5 SKILLS — SMALL, MEDIUM AND LARGE EMPLOYERS

Small employers

(skill type) % of total

Medium employers


Large employers


Communication skills 42%

Technical skills 18%

Customer service skills 13%

Selling skills 13%

English language skills 7%





Physical skills 6%



Management skills 11%

Work ethics 8%



In addition, survey respondents identified the broad occupation categories where there are current vacancies (see Figure 3.6). There are significant differences in vacancies across employers depending on their size. For example, 42 per cent of vacancies for small employers were in service and sales staff. For medium employers 44 per cent of vacancies were in managers and business executive staff and for large employers, the majority of vacancies (59 per cent) were in construction occupations.



Figure 3.6 CURRENT VACANCIES — SMALL, MEDIUM AND LARGE EMPLOYERS


Employers also rated the importance of work related skills on a scale ranging from not important to very highly important (see Figure 3.7). For small employers, the most important work related skill was customer communication, whereas for medium employers the most important work related skills was technical ‘know how’. For large employers, the most highly rated skills were work communication, customer communication and literacy skills.



Figure 3.7 IMPORTANCE OF WORK RELATED SKILLS — SMALL, MEDIUM AND LARGE EMPLOYERS




Chapter 4

Future solutions for Bahrain’s labour force

4.1 Overview

This chapter highlights the key findings from each of the eleven selected sectors detailed further in Part B, C and D of this report. The key findings focus on the skills gaps analysis and future skills issues in each of the sectors.

Drawing on these sectoral key findings, conclusions on the skills gaps in Bahrain’s labour market are drawn and next steps are identified.

4.2 Key findings — public services

Education

Broader skills gaps areas that are direct to other industries point to skills gaps within the education sector because as previously stated, it is Bahrain’s main skills provider. These types of skills gaps include:

• higher education teaching skills — while overall there seems to be an adequate

supply of education graduates for primary education, there are skills gaps in specialised fields of education (such as early childhood, secondary, technical and higher education; curriculum and assessment; educational planning)

• technical training skills — which is reflected in the general shortage of

engineers, technologies and middle level technicians

• career development skills — including careers development issues such as careers counselling and provision of on-site training

• education administration skills — including skills required by education

managers (principals, directors, deans), and administrative skills. Applying the results from the employer survey and the current skills gaps identified in the labour market analysis allows for an approximate number of specific occupations required in 2012, including the future need for:

– 650 education providers

– 400 administrative services staff

– 350 other education related workers.

Key future skills challenges facing Bahrain’s education sector are:

• the quality of education that is hindered by problems in basic skills outcomes

from schooling

• there is an over-supply of humanities-social science graduates who often are lacking employability skills, and a shortage of science, mathematics, technology and nursing graduates

• difficulties in ensuring a supply of graduates and recruiting them into teaching

in areas where there are mismatches between supply and demand such as early childhood, VET, mathematics, science and technology.



Health

Currently, health sector skills gaps fall into three main areas:

• health care specialists — a critical issue for the health system, projections of the health sector workforce show that these shortages will persist for Bahraini national employees at least for the next three years

• health management and coordination (including human resources and health

workforce planning) — cited by the WHO in 2005 and these skills will be crucial to continue to develop to maintain the current performance of the health system for Bahrain’s population

• administration — Administration training was the one aspect of training where

the number of organisations with the current capacity to provide this training in-house fell short of the number of organisations that highly prioritise this type of training.

Applying the results from the employer survey to the these skills gaps allows for an estimation of the approximate number of specific occupations required in 2012, including the future need for:

• 1 850 health professionals

• 2 500 managers

• 7 000 other health workers

• 380 administrative workers.

By 2012, it has been projected that there will be a shortage of several types of qualifications in the industry — a shortage of Bahraini staff with Diplomas, secondary education and at the PhD level and non-Bahrainis with Bachelor degrees, Diplomas, secondary education, high diplomas, masters and PhDs.

The efficacy of the health sector, given the skills gaps identified above, will be under pressure in the future — especially in a context of high incidences of non- communicable diseases in Bahrain coupled with a growing population.

• in the short term, the Bahrainisation policy may be contributing to the current

staff shortages, hindering recruitment of foreign staff where Bahrainis lack the skills for specialist position

• strong encouragement to grow the private health sector because of the benefits

it will bring to the whole of Bahrain, including tapping into the health tourism industry

• in the longer term, the key problem facing the health sector is the current

health workforce shortages in two significant areas — health specialities, including allied health positions and nurses, and heath management, human resources and health workforce planning skills

It is important to note that the health sector is ideal to target participation from the growing young female Bahraini population and alternative training and employment options could be considered to make participation in the sector more attractive.



Public Administration

Primarily due to the existence and performance of the Civil Service Bureau and the high regard, which Bahrainis perceive a career in the public service, skills gaps tend to be lower in public administration compared with other sectors. Nonetheless, the labour market analysis and stakeholder comments suggest that a skills gap exists in terms of management and leadership skills. In addition, there is considerable need within the sector to accommodate an increasing number of female graduates predicted to enter the sector.

Results from the employer survey and the current skills gaps identified in the labour market analysis can be used to determine an approximate number of specific occupations required in 2012, including the future need for:

• 1 800 administrative staff

• 720 engineering/technical staff

• 171 managers (mainly at the director level).

The largest gaps in qualification between 2008 and 2012 will be for employees who have completed secondary school (35 per cent of the gap, equal to 3 614 jobs) and for employees with a bachelor qualification (26 per cent of the gap, equal to 2 685 jobs).

The main problems facing public administration in Bahrain are:

• an overly rigid (complex) system for classifying and promoting staff that does

not provide for flexible management of human resources at the agency level

• the absence of a recognised qualifications framework from which public sector organisations can make judgements about training needs, promotions, and recruitment

• an anticipated shortfall in the number of university graduates at the Batchelor

degree level and above

• inadequate data about the quality and effectiveness of public sector training

• growing number of female university graduates seeking high-level opportunities within the public sector.

4.3 Key findings — infrastructure

Construction

The Bahrain construction sector is not experiencing labour shortages alone, rather it is within the context of an international trend. In Bahrain, skills gaps lie in three key areas as discerned from the findings of the labour market analysis, surveys and other reports. These are in:

• induction, administration and technical skills for low-level workers

• tertiary and leaderships skills for high-level Bahraini employees

• human resources skills to assist entrants to jobs within the sector.



Applying the results from the employer survey and the current skills gaps identified in the labour market analysis can be used to determine an approximate number of specific occupations required in 2012, including the future need for:

• 34 000 construction workers

• 3 000 engineers/engineering technicians


• 1 250 managers.

Areas of the construction sector that could emerge as issues in the future include:

• an inadequate number of people entering training

• the high attrition rate of apprentices (in Bahrain’s case, there is no

apprenticeship model/program in place)

• a high separation from the skilled trade workforce once people are qualified, caused by low demand for skills, declining industry employment prospects, and/or better careers and conditions being offered in other industries/sectors

• difficulties in recruiting new entrants with the right level of prior education,

skills and attributes

• lack of training in particular segments of the sector because of structural issues factors such as out-sourcing or sub-contracting

• an insufficient level of activity by the existing trade workforce in upgrading

skills once initial qualifications have been attained

• addressing the issue that many employers only send employees to training courses when it does not disrupt their work and where it is vital to their firm (Libert 2004).

Despite non-Bahrainis continuing to fill the majority of unskilled and highly skilled positions, shortages in labour and delays in projects are likely to persist. Increased global competition for labour, low wages in the sector, and the impact of training levies on business sustainability may see workers and developers go elsewhere

ICT

The skills gaps in Bahrain’s ICT sector are apparent from the findings of the labour market analysis, surveys and other reports. Currently, ICT sector skills gaps fall into 3 main categories:

• ICT management and coordination skills

• certified software application technical skills

• IT strategy and planning skills.


• 1 300 service and sales staff



• 1 200 managers

• 1 100 engineers/technicians

• 650 scientists/technicians managers.

In this context, the problem of insufficient numbers of IT-trained personnel in Bahrain is expected to grow:

• it is suggests that personnel with strong fundamental IT skills and knowledge

will be able to adapt to new IT technologies more rapidly than personnel only possessing application-specific skills and knowledge

• new IT hardware and software applications are increasingly technical and

complex, requiring highly skilled personnel at both operation and maintenance levels.

Telecommunications

The extent to which the telecommunications sector in Bahrain is suffering from specific skills gaps is unclear, given:

• the relatively high levels of mobile, broadband and Internet penetration in

Bahrain

• the general absence of skills shortages identified by key stakeholders during consultations.

Nonetheless, due to the projected gradual expansion of the sector’s workforce, and the continuing convergence of the telecommunications and IT industries, there are a number of general skills areas that government and business leaders could focus on to ensure the future success of the telecommunications sector. These include:

• ICT literacy – primarily to allow for effective interaction with software linking

telecommunications devices and multi-media services

• e-business techniques – ranging from knowledge about email and VoIP to business-to-business electronic commerce

• sales and customer service.

Results from employer survey and the current skills gaps identified in the labour market analysis can be used to determine an approximate number of specific occupations required in 2012, including the future need for 120 engineers and technicians, and only a small number of administrative and sales services occupations (70 managers and 70 services and sales staff).

The main problem facing the Bahraini, telecommunications sector:

• is the constraint of a lack of local vocationally trained, work ready, graduates

to fill existing vacancies or to cater for new growth

• a sufficient supply of suitably trained employees



Transport and logistics

Currently, key skills gaps in the transport and logistics sector include:

• logistics and freight skills — future improvements in logistics and freight skills will be important to increase competence in this area of the sector. The results of the employee survey identify a need for employees with a Diploma or Bachelor qualification (approximately 1 833 jobs) in 2012

• airport services skills — required as the Bahrain International Airport

continues to grow and improve facilities, infrastructure, and in turn, activity. Specific skills include customer service and sales skills, engineering and maintenance skills, and emotional (attitudinal) skills

• airline cabin crew skills — will also be required in the future as Bahrain

increases its connectivity within the GCC and MENA regions and beyond. In addition to cabin crew skills, call centre skills for airlines will also be required.

The approximate number of specific occupations required in 2012, include the future need for approximately 7 400 positions, including:

• 6 600 general transport and logistics positions

• 800 engineers and technicians

• 670 administrative staff

• 330 managers.

Areas of the transport and logistics sectors that could emerge as issues in the future include:

• slow Bahraini employment growth — labour market analysis shows no growth

in the Bahraini workforce to 2012 in the sector

• an under utilised female workforce — given the pool of young Bahraini women that could potentially participate in the labour force, restricting and under-utilising the female workforce could be a significant human resources issue in the future

• maintaining international competitiveness in logistics — the shortage of

workers (particularly Bahraini) and skills in the logistics sector may have implications for maintaining this competitive status in the region. New infrastructure in the sector (such as the KBS port and Bahrain Logistics Zone) will further emphasis skills gaps as these projects build up to full capacity

• public transport — if improvements to the current public transport system are

considered in the future, a significant skills base will be required to expand public transport options.

4.4 Key findings — trade and other services

Business services

The skills gaps in Bahrain’s business services sector are apparent from the findings of the labour market analysis, surveys and other reports. Currently, business services sector skills gaps fall into 3 main categories:



• specialist legal and accounting skills — primarily advisory and analysis services, targeting such business areas as Islamic banking and insurance, intellectual property and finance

• management and coordination skills — for example, resource managers,

engineering process managers, accountants and sales and marketing executives

• paralegal and legal clerical skills — miscellaneous business and legal support roles, ranging from legal assistances to receptionists and numerical clerks.



• 900 business professionals

• 550 managers

• 400 administrative services.

The major problems facing the expansion of the business services sector include:

• labour force supply — labour market analysis suggests that the industry will

still be 68 per cent reliant on non-Bahraini’s by 2012. Unless female participation, especially of those with post-school training increases above the current rate, there may be problems in attracting sufficient domestic labour to cover even the 32 per cent predicted for Bahrainis.

• labour force skills — this is potentially the greatest problem facing the industry

because at the top end of its labour requirements it will be in competition for skilled managerial and technical labour with other sectors.

• the majority of needed labour will require vocational training either by itself or

in combination with general academic training. Lack of opportunities for vocational training has been identified during the consultative process as a major constraint to growth in the economy.

Manufacturing

It is expected that Bahrain will not undergo the same contraction in manufacturing employment as generally experienced by developed and developing countries worldwide However, Bahrain is likely to suffer a skills shortage comparable with international trends. Skills gaps identified in the sector were technical skills and higher-level manufacturing skills (such as engineering).

The approximate number of specific occupations required in 2012, include the future need for approximately 31 000 positions, including:

• 14 000 manufacturing trades

• 2 000 engineers and technicians

• 1 600 managers

• 1 400 services and sales staff

• 1 100 administrative staff.



The increase in manufacturing employment and the skills shortage in the sector are linked, as the increase in employment is likely to drive up demand for trained personnel, leading to a further skills shortage. In terms of additional skills gaps:

• employee and employer survey respondents also commented on the skills they

see as important for their jobs (now and in the future), including physical skills, and technical know-how as the most important

• qualifications gaps in manufacturing sector are expected to be for employees

who have completed secondary school, followed by primary and preparatory school. However, employee and employer survey results suggest that there may be greater demand for qualifications at the Certificate/Diploma and Bachelor degree levels.

As a result of these skills gaps, the biggest challenge facing the manufacturing sector in line with a likely contraction in demand for manufactured products affecting employment growth in the sector. Key skills issues for the manufacturing sector include:

• determining the extent of the impact of a contraction in manufacturing demand

on the workforce and associated skills needs

• global agreement on a common approach to addressing climate change could pose problems to manufacturing in Bahrain — affecting competitiveness and employment growth

• enhancing the appeal of manufacturing as a career choice for young Bahrainis

• ensuring that the Bahraini education system is increasingly responsive to the

skill needs of the manufacturing sector.

Tourism and hospitality

The tourism and hospitality sector has skills gaps in two key areas as discerned from the findings of the labour market analysis, surveys and other reports. These are in:

• generic skills — which have stemmed from a lack of training provision

• soft skills — including motivation to work in the tourism and hospitality

sectors (especially for Bahraini employees) and to enhance this motivation, attracting skilled candidates to jobs within the sector.


• 1 800 other tourism workers

• 1 700 services and sales workers

• 1 000 managers


• 650 administrative staff.



Bahrain’s tourism and hospitality sector is experiencing many of the workforce challenges that are common to tourism and hospitality sectors and services industries in other countries. The main problems facing the sector are:

• maintaining and attracting a sufficient supply of suitably trained employees

• that jobs in the sector are not viewed as desirable among the Bahraini

population

Bahrain’s growing luxury tourism infrastructure and development is potentially exposed to face increasing competition for international workers from other nations in the region given the rapidly growing competition for tourism and hospitality labour.

Trade

The results from the employer survey suggest that:

• companies in the wholesale and retail trade sector are finding it somewhat

harder to attract quality staff, though not as difficult in comparison with all sectors generally

• finding good candidates appears to be less of a constraint on hiring for

companies in trade, compared with all sectors generally

• quality of recruits in trade has improved over the past two years though this improvement is slightly less than that of all sectors generally.

The trade sector has shortages in three key areas as discerned from the findings of the labour market analysis, surveys. These areas are in:

• retail customer service skills

• human resources skills — to assist in career development and retaining

employees within the trade sector

• soft skills — including motivation to work in the tourism and hospitality sectors (especially for Bahraini employees) and to enhance this motivation, attracting skilled candidates to jobs within the sector.



• 7 000 scientist or engineering technicians

• 5 200 other trade positions

• 3 000 managers


• 1 800 business professionals.

Overall, these findings imply that the skills gap facing the wholesale and retail trade sector is less pressing than other sectors, though there is clear room for improvement in the general skills profile of new recruits.



The main problems facing the trade sector in Bahrain are:

• an over-riding issue of unfavourable perceptions among Bahrainis about working in the trade sector. This extends to a perceived lack of career pathways

• some relatively specific skills require further development in this sector in

advanced customer service, English proficiency, retail management, merchandising and technical skills. However, Bahrainis are not necessarily choosing to undertake this training in sufficient enough numbers to fill the predicted gaps in

• trade will continue to rely heavily on non-Bahraini labour.

Remuneration is often relatively low in trade compared to other sectors. Given that secondary level education is generally viewed as being sufficient for many of the jobs in trade, it is perhaps inevitable that wages will continue to be relatively low for many jobs.

4.5 Conclusions

The report highlights the importance of a skilled workforce in responding to the drivers within and across industry sectors. Workforce skills, capability and employee attraction and retention are also drivers of business success across all of the industry sectors analysed.

The analysis highlights the growing complexity of identifying skills needs. It also highlights the need for flexible responses to emerging and changing skills needs. The overview of the future solutions for Bahrain’s labour force highlights the following key issues:

• the quality of education affecting basic skills outcomes from schooling

• an over-supply of humanities and social science graduates

• in some sectors the Bahrainisation policy may be contributing to the current

staff shortages by hindering the recruitment of foreign staff particularly where Bahrainis lack the skills for specialist positions

• growing number of female university graduates seeking high-level

opportunities in a number of sectors and an under-utilised female workforce

• the absence of a recognised qualifications framework for the public administration sector

• a high attrition rate of apprentices (in Bahrain’s case, there is no apprenticeship

model in place)

• high separation from the skilled trade workforce once qualifications are gained

• a lack of local vocationally trained work ready graduates to fill existing vacancies and to cater for any future growth

• enhancing the appeal of particular sectors such as manufacturing, tourism and

hospitality as a career choice for young Bahrainis

• Bahrain is exposed to potentially increasing competition for international workers from other nations in the region particularly in tourism and hospitality



• specific skills required across a number of sectors related to customer service, English proficiency and technical skills that are not being addressed in sufficient enough numbers to fill the predicted gaps.

Overall, organisations need well-qualified staff with a range of generic skills in order to deliver sustainable outcomes across all sectors of the economy. The research in this report shows that there are predicted people shortages across the sectors, that there are concerns over technical skills and that generic skills remain important and lacking in many areas.



Part B

Sectoral and skills gaps analysis — public services



Chapter 5

Education

5.1 Characteristics of the sector

The key player in the formal education sector is the Ministry of Education. It is responsible for drafting education and training legislation, education policy, funding, curriculum, assessment and administering public educational institutions (schools, colleges and universities) attended by the vast majority of Bahrainis (Ministry of Education 2008b).

Prior to formal schooling, children can attend pre-school education provided by the private sector. Children under three years of age can attend nurseries that are under the supervision of the Ministry of Social Development. Children aged 3-5 years can attend kindergartens under the supervision of the Ministry of Education.

Basic public education in Bahrain consists of two cycles at the primary level for students aged 6 to 11 years, and a third cycle at the intermediate level for students aged 12 to 14 years. In the first cycle, the class-teacher system applies where one teacher teaches all subjects; and in the second and third cycles, the subject-teacher system applies where a specialised teacher teaches a particular subject.

Some male students undertake their basic and secondary studies at the Jafari Religious Institute, entering and finishing at the same ages as other school students. The Institute offers similar curricula to public schools as well as Islamic studies.

In 2008, the Minister of Education announced the establishment of the Center for Appraisal and Assessment, which will assess curricula, train Ministry employees, provide specialist advice, and create an examination centre (Ministry of Education 2008a).

The Ministry of Labour (2008a), through its High Council for Vocational Training, is responsible for Bahrain’s training sector. Some of its activities include:

• proposing policies and programs related to training and human resource

development

• ensuring that citizens working in the private sector institutions have the training needed to perform the tasks entrusted to them

• developing national plans for guidance and vocational consultancy

• developing a system for evaluating training institutions at the national level

• developing a system of professional standards issuing national certification

• co-ordinating between private enterprises and vocational training institutions in

providing in vocational training programs.



Bahrain’s higher education sector consists of universities, colleges and institutes. In 2006, there were 16 universities, two of which are public and 14 are private. Bahrain’s Higher Education Council accredits degrees from these universities. In 1986, the Bahrain Government established the University of Bahrain. In 1979, the GCC States established the Arab Gulf University, which consists of a medical college and post-graduate college. Leading specialist colleges and institutes include the Bahrain Institute for Banking and Finance, Bahrain Institute of Technology, Bahrain Institute of Hospitality Management, and College of Health Science.

Similar to other GCC States, Bahrain has opened private universities with strong Government support, and is actively seeking collaboration with international universities (Embassy of the Kingdom of Bahrain 2008a; Gulf University 2008a). The Ministry of Education gave private universities six months to comply with standards prescribed in higher education law. Those universities that failed to comply with the new set of rules governing their operations would have their management and finances switched to the Ministry of Education (Gulf News 2008; Khaleej Times 2008).

The Directorate of Adult Education at the Ministry of Education organises literacy and adult education programs. The Directorate also organises continuing education programs for adults seeking to improve their knowledge in fields such as languages, family/life education, and Information and Communication Technology (EU ICT Taskforce).

The Directorate of Training at the Ministry of Education implements training policies for teachers and other technical staff; internally or in conjunction with other educational institutions in Bahrain or abroad.

The Educational Research and Development Center at the Ministry of Education conducts research with the aim of improving the quality of educational and instructional services in Bahrain.

As at 2005-06, there were 259 schools in Bahrain, of which 203 were public and 56 were private. There has been a small improvement in the student/teacher ratio in public schools (13 in 2001-02; 11.9 in 2005-06) and private schools (16 in 2001-02; to 15 in 2005-06).

General employment trends in Bahrain’s education sector show an increase in employment between 2002 and 2007 in the Ministry of Education (19.4 per cent) — to a total labour force of 16,282 (see Figure 5.1). Of these education providers, 14 399 were Bahraini and 1883 were non-Bahraini teachers. Currently, there is an oversupply of female education graduates for primary education, but skills gaps exist in specialised fields of education (science, maths, technology, and vocational areas) that are mainly filled by non-Bahrainis.



Figure 5.1 MINISTRY OF EDUCATION — 2002 TO 2007

Source: (Civil Service Bureau (CSB) 2008b).

In terms of qualifications, the majority of employees in the education sector had completed a Bachelor degree, a Masters degree or a diploma (see Figure 5.2).

Figure 5.2

QUALIFICATIONS — EDUCATION


School teachers who teach the first cycle of basic (primary) education should hold a Bachelor’s degree in education. Teachers who teach the second cycle of basic education should hold a bachelor’s degree in one of the Arts (Arabic, social studies or religious education) and have a good academic background in a science or mathematics. Teachers who teach at the intermediate and secondary levels should hold a Bachelor’s degree in a specialised academic subject together with a minor in education. All university graduates are required to sit proficiency tests in their academic subject. Ministry of Education teachers can also access in-service training programs offered by the University of Bahrain as well as short-term training courses offered by the Directorate of Training (International Bureau of Education 2008).



5.2 Education in Bahrain

In 2007, the education sector contributed BD179.82 million (2.6 per cent) to GDP, an increase of 25.7 per cent from 2002. Further, workers in the sector (19 683) made up 3.9 per cent of the total labour force in 2007, an increase of 22.4 per cent from 2002 (see Figure 5.3).

Figure 5.3 EDUCATION AS A PROPORTION OF GDP AND LABOUR FORCE — 2002 TO 2007

Source: (Central Informatics Organization 2007; Central Informatics Organization 2008; Labour Market Regulatory Authority 2008a).

Pre-primary education in Bahrain is predominantly private and has grown quite rapidly since 1999, the gross enrolment ratio in 2005 reaching 49 per cent. Given that the age structure of the Bahraini population shows that Bahrain has a large number of pre-school children, one can expect the demand for early childhood programs and educators that has occurred (see Figure 5.4) will continue over the next decade.

Figure 5.4

PRE-PRIMARY ENROLMENTS OF STUDENTS AT OFFICIAL SCHOOL AGE, 1999-2006

Source: (UNESCO Institute of Statistics 2008).

Primary and secondary school enrolments grew strongly between 1999 and 2006 i.e. 17.6 per cent growth in primary school enrolments (Figure 5.5) and 25.4 per cent growth in secondary school enrolments (Figure 5.6).



Figure 5.5

PRIMARY SCHOOL ENROLMENTS, 1999-2006


Figure 5.6

SECONDARY SCHOOL ENROLMENTS, 1999-2006


In Bahrain, virtually all Bahrainis complete twelve years of schooling, one of the highest rates of participation worldwide, especially for girls. Most schools are public, private enrolment being 24.7 per cent at primary level and 16.5 per cent at secondary level (in 2006). Private schools include those catering for the needs of the children of Indian, Pakistani and international workers. In government schools, student/teacher ratios match the levels in developed countries worldwide. The demand for teachers in the public sector will closely match demographic and attrition trends.



A key factor is the quality of the teaching provided and the standards expected of students and teachers. Most teachers are Bahraini and have a teaching qualification. However, there are concerns (EBD Education Reform team) regarding the admission standards applied, the quality of the training provided and selection of entrants to the teaching profession, allegedly well below those demanded in countries performing well, economically and educationally (e.g. Singapore, Finland).

The implications for future labour demand that follow from these factors are:

Total secondary enrolment has steadily increased over the past five or six years. Participation in vocational education has increased significantly (see Figure 5.6), while participation rates in general upper Secondary education have fallen. There were 15 200 secondary students enrolled in public technical and vocational programs in Bahrain in 2006; participation of females rising from 21 per cent in 1988 to 37 per cent in 2002.

Figure 5.7

SECONDARY ENROLMENTS IN PUBLIC TECHNICAL AND VOCATIONAL PROGRAMS, 1999-2006


Although tertiary enrolments have fallen slightly (19 079 in 2003 to 18 403 in 2006, see Figure 5.8), Bahrain also has the highest rate of participation (GER = 36 per cent in 2005) in tertiary education in the GCC.



Figure 5.8 TERTIARY ENROLMENTS, 1999, 2003-2006


To meet the demand for higher education, Bahrain has drawn on both expatriate talent and the increasing pool of Bahrain nationals returning from abroad with

1

advanced degrees. graduate programs.

The University of Bahrain offers standard undergraduate and

The College of Health Sciences and the Gulf University train medical and paramedical personnel. The national education charter, passed in 2001, paved the way for the formation of private universities and colleges, the first private university being Ahlia University in Manama. The EDB estimates that that there are now about 160 training institutes, the heaviest concentration being in IT and business. Given the paucity of programs available for training in other sectors (for exmaple, industry, engineering), Bahrain has recently established a polytechnic based on the New Zealand model of applied degrees to meet skills gaps in areas not covered by the private sector.

Literacy rates (see Figure 5.9) and participation rates of young Bahrainis in education and training are around average for men and slightly below for women by GCC standards. However, there remains a small but lingering problem of illiteracy in the older Bahraini and non-Bahraini population. In 2007, 11.2 per cent of the 15 years old plus population were illiterate, with the remaining 88.8 per cent of the adult population literate (UNESCO Institute of Statistics 2008).

1 In 2005, there were 2,514 Bahraini tertiary students studying abroad. The top five destinations were UK, USA, Jordon, Australia, and Saudi Arabia (UNESCO 2007)



Figure 5.9 YOUTH LITERACY RATES, 15-24 YEARS, 2007


Moreover, as in all countries, a significant number of Bahrainis and non-Bahraini residents are functionally illiterate, that is, they lack the basic reading, writing and numeracy skills needed to function effectively in the labour market. Estimates of functional illiteracy in GCC States are generally considerably above the OECD average. Standards required and the range of skills (e.g. IT skills) needed to function effectively are both changing and rising, making the provision of adult and continuing education a necessity for the majority of workers and those facing difficulty in gaining employment.

5.3 Skills formation in the sector

The education and training sector is the major supplier of skilled Bahraini labour. The skills levels of Bahraini entrants to the labour market and those in employment are a function of the education and training provided by the education-training sector.

Establishments/companies, subsidies from the Bahrain Government, and the Training Levy Scheme are the key funding sources for vocational training programs in Bahrain. The Training Levy Scheme requires private companies employing 50 workers or more to pay 4 per cent of total wages of the expatriate workers on a monthly basis. Companies can claim back 75 per cent of the levy if they use it to train their Bahraini workers. Companies with ‘exceptional and outstanding’ training programs for Bahraini workers, and/or with a workforce comprising at least 60 per cent of Bahraini workers can apply to recover up to 100 per cent of its total payment Ministry of Labour (2008b). In 2006, employers contributed BD2 204 504 (or US$5.8 million) to the scheme.



Under the supervision of the High Council for Vocational Training, 59 831 trainees completed 3.9 million training hours at a cost of around US$79 million in 2006. Table 5.1 shows that 12 large establishments/companies that were exempt from the training levy accounted for almost 60 per cent of all trainees, 31 per cent of training hours, and 70 per cent of training expenditure in 2006. Training activities included language training, engineering training, computer training, management and supervisory training, commercial training, and craft and technical training. Almost 70 per cent of trainees in these establishments/companies were undertaking craft and technical training, which goes some way in explaining why 95 per cent of trainees were males.

Table 5.1

TRAINING STATISTICS – 2006

Training activity Trainees Hours Expenditure

Males Females Total

Training levy establishments (118 establishments)

Exempted establishments from the training levy (12 establishments)

1 997 572 2 569 107 009 657 470

33 469 1 594 35 063 1 242 963 20 897 249

Job seekers training programs 361 176 537 644 800

Bahrain Training Institute (includes 1,871 trainees in corporate training programs) (3)

Specific Council for Vocational Training in the Banking Sector

Specific Council for Vocational Training in

3 693 2 337 7 301 2 034 580 4 736 000 4 693 2 909 7 602 66 873 2 099 029

Hospitality 727 237 964 227 618 538 149

Specific Council for Vocational Training in Industry

Specific Council for Vocational Training in R etail

Specific Council for Vocational Training in

1 577 240 1 817 94 963 411 033 1 021 675 1 696 59 856 396 689

Construction 1 751 214 1 965 114 165 660 178

National Program for the Employment and Training of Bahrainis

83 102 185 n.a. n.a.

National Employment Project 42 90 132 n.a. n.a.

BD29 846 035

(Partnership for Total 49 414 49 414 59 831 3 948 027 21st Century

Skills) US$79.1 million

Notes: Training expenditure under the supervision of the High Council and the Specific Councils for Vocational Training. (Partnership for 21st Century Skills) Does not equal the sum of all training activities. (3) The High Council for Vocational Training allocated 3,500,000 to BTI in 2006. Source: (Partnership for 21st Century Skills).



The Bahrain Training Institute (BTI) is the largest individual provider of vocational training programs. It aims to ‘offer the highest standard of training programs to accommodate the needs of the different sectors; industry, operation, construction, trade, information technology, travel and tourism, and services’(Bahrain Training Institute 2008e). BTI offers regular full-time programs for job seekers (Higher National Diploma, National Diploma and Craft Certificate programs) as well as short corporate training programs. The National Diploma and First Diploma accounted for the majority of trainees and graduates in both 2006 and 2007 (Table 5.2). Forty-eight percent (48 per cent) of graduates who had completed a qualification in 2007 were not working three months after graduating, which is a serious concern given much higher recruitment rates of previous years, (Figure 5.10).

Table 5.2 NUMBER OF TRAINEES, GRADUATES AND TRAINING HOURS, BTI, 2007-2008

Trainees 2006 Trainees 2007 Graduates 2008

First Diploma 1 984 2 220 633

National Diploma 2 168 2881 427

Higher National Diploma 563 700 128

Craft 682 616 35

Total trainees/ graduates 5 397 6 417 1 223

Total training hours 2 034 850 2 419 104 n.a.

Source: (Bahrain Training Institute 2008d).

Figure 5.10

BTI GRADUATE OUTCOMES (3 MONTHS AFTER GRADUATION), 2005-2006

Source: (Bahrain Training Institute 2008d).



There were 18 841 higher education enrolments in Bahrain in 2005, of which 68 per cent were females; and 756 teachers working in higher education institutions, of which 41 per cent were females (UNESCO 2007). In the same year, there were 3 185 graduates, with 40 per cent of them graduating in the fields of social science, business, and law (see Figure 5.11). Students must have completed a General Secondary School Certificate to apply for admission to a university.

Figure 5.11 HIGHER EDUCATION GRADUATES BY FIELD OF STUDY, 2005

Source: (UNESCO 2007).

The extent to which higher education students engage in on-the-job training during their studies is difficult to gauge; though an initial search indicates that opportunities are available. For example, the Bahrain-based Gulf Finance House (GFH), Islamic investment bank, Citibank, and the Securities and Investment Company target banking students with the offer of summer internship programs. Gulf Air’s summer work training program that commenced in 2003, targets university students from different fields. Batelco provides work experience for 100 students each year. The recently opened Bahrain Polytechnic will provide students with the opportunity to “engage in cooperative projects with companies, enabling [students] to apply theory to practice in new and innovative ways” (Embassy of the Kingdom of Bahrain, 2008b, 2008c; AME Information, 2008; Bahrain Gateway to the Gulf, 2006; Bahrain Polytechnic, 2008, Khaleej Times, 2008b).

5.4 International trends in education

Recent analyses of international trends in education (OECD, 2008a; Power 2006; UNESCO, 2007b) show that developing countries are struggling to reach the millennium development goals, including those relating to basic education.

In developed countries, new challenges are emerging and having a profound impact on education. The global economy is increasingly knowledge intensive – and there is widespread recognition that tertiary education and R&D are major drivers of economic competitiveness and productivity gains.

Major international trends in education skills and labour demands include:

• expansion of early childhood education, linked with evidence indicating

benefits of ECE and increasing number of women in the workforce (UNESCO 2007)



• trend towards universal secondary education leading to increasing vocationalisation of secondary education

• rapid expansion of tertiary education systems (globally student numbers grew

from 68 million in 1991 to 132 million in 2004, that is, a growth rate of over 5 per cent per annum)

• developing a closer relationship between tertiary education and the external

world including greater responsiveness of institutions and systems to labour market needs (Organisation for Economic Co-operation and Development)

• increasing focus on accountability and performance, quality assurance,

accreditation, bench-marking and league tables in the highly competitive internationalised world of higher education.

Within OECD countries, the total amount of public spending on education between 2000 and 2005 grew by an average of 19 per cent. The Bahrain Government has also increased public spending on education; up from 13 per cent in 2000 to 17.6 per cent in its 2008 budget (Ministry of Finance 2008), well above the OECD average growth rate. However, the contribution of the education sector to Bahrain’s GDP has fallen from 4.5 per cent in 2002 to 2.6 per cent in 2007 — the second lowest of all GCC countries based on available data (Figure 5.12).

Figure 5.12

PUBLIC SPENDING ON EDUCATION, GCC COUNTRIES, LASTEST YEAR AVAILABLE

Source: (Organisation for Economic Co-operation and Development 2007; Central Informatics Organization 2008; Ministry of Finance 2008).



One of the key problems facing education in Bahrain, as in many countries, is the relatively low-status of teaching compared with that of other professions. Globally, it is has become increasingly difficult to attract and retain able and well-qualified graduates (particularly in areas in heavy demand in the labour market). Other things being equal, the quality and outcomes of education and training programs are very much dependent on the status, training and quality of teachers. The ‘best’ education systems in the world are those in which the teaching profession commands high prestige and that have high standards for recruitment (Darling-Hammond 1998; Organisation for Economic Co-operation and Development 2007). To make progress towards these ideals, there has been a move towards new systems of preparation and professional development for teachers, principals and lecturers. Most developed countries have set performance standards for entry into the profession and strengthened registration requirements, and increasingly school principals are expected to have undergone specialised post-graduate programs.

5.5 The future labour and skills needs

This section discusses the future labour and skills needs of Bahrain’s education sector with reference to labour market analysis, key results from the employee and employer surveys, and key stakeholder consultation.

Labour market analysis

In Bahrain general education sector employment trends show that the number of jobs in 2012 will have increased to 17 316 — a 6.4 per cent increase when compared to the number of jobs in 2007 (see Figure 5.13).

Figure 5.13

EMPLOYMENT PROJECTIONS, MINISTRY OF EDUCATION, 2008 TO 2012

Source: (Allen Consulting Group and Eidos); (Civil Service Bureau (CSB) 2008a).

If we assume teacher-student ratios remain at their present levels, the number of new school teachers required in the public sector is the sum of the number leaving the sector and the number needed to accommodate the projected growth in the Bahraini school-aged population (recent trends being the average annual growth rate for primary schooling being 2.5 per cent and for secondary being 3.6 per cent). Employment flow data indicate that very few Bahrainis resign from positions in the public sector. On the other hand, changed economic conditions could result in an outflow of non-Bahraini teachers and their replacement by Bahrainis.



Data on education employees in the private sector from General Organisation of Social Insurance (General Organization for Social Insurance (GOSI)) provide a basis for projecting the number of private sector employees in 2012 (see Table 5.3). While there can be no doubt that there are supply-demand problems facing the education sector, as with other sectors it needs to noted the methods of estimating demands have a number of weaknesses, namely:

• income advantages are less determined by demand-supply ratios than is

commonly asserted by the human capital approach

• the manpower approach tends to underestimate the openness between education and employment and accommodation processes taking place when supply exceeds the presumed demand

• manpower planning based on employer surveys tend to overestimate the ability

of employers to identify the competencies required and to specify the required learning.

It should be noted as well that skills gaps in specialised fields of education (e.g. subject areas in upper secondary and tertiary education) require more detailed analysis than has been possible with existing Bahraini databases.

Table 5.3

PUBLIC AND PRIVATE EDUCATION SECTOR EMPLOMENT PROJECTIONS

Education sub-sector by year Bahraini Non-Bahraini TOTAL Public sector 2002 12 285 1 355 13 640

2007 14 399 1 883 16 282

2012 15 042 2 273 17 316 Private sector 2002 1 615 2 006 3 621

2007 2 094 2 735 4 829

2012 2 229 2 790 5 019 TOTAL EDUCATION 2002 13 900 16 493 17 261

2007 16 493 4 618 21 111

2012 17 271 5 063 22 335

Source: Projection based for private education employees from GOSI data 15.1.09; public sector from CSB data from the Ministry of Education (teachers plus administrators).

Employee, graduates and employer survey results

Employer survey

A survey was undertaken of Bahraini employers, with 15 responses received from private education sector organisations. Another 11 education institutions (including the University of Bahrain) were surveyed and separately and discussed in Chapter 3.



The 533 employees encompassed by the survey’s 15 respondents comprised 11 per cent of the total number of employers within the private education sector and 0.8 per cent of total surveyed employers across all sectors. Of the employees captured in the survey, the majority — 67.5 per cent — are Bahraini and females dominate males, comprising 57 per cent of the employees.

The composition of the private education sector is such that education providers, followed by administrative services are the two largest first tier job categories. Table 5.4 shows first tier job categories by demographic group.

Table 5.4 FIRST TIER OCCUPATIONAL GROUPS — EDUCATION

Bahraini

males

Bahraini females

Non- Bahraini

males

Non- Bahraini females

Managers and business 2% 5% 3% 17% executives

Health professionals 0% 1% 0% 0%

Education providers 50% 32% 80% 49%

Business professionals 2% 1% 0% 0%

Administrative services 38% 24% 10% 29%

Services and sales people 0% 1% 0% 0%

Other occupations 9% 37% 7% 6%

Total 100% 100% 100% 100%


Bahraini females are the largest demographic group within the sector and are mainly involved in education provider positions. The second largest group in the sector are Bahraini males who also predominantly work as education providers followed by sales and administrative services.

When asked to provide information on occupations at more detailed level (second- tier level), employers identified most employees in the sector as administrative managers (45 per cent), private sector managers (15 per cent) and professionals in handicapped education (13 per cent) (see Figure 5.6).



Table 5.5 SECOND TIER OCCUPATIONS — EDUCATION

Second Tier Occupation

Proportion of total sector responses

Administrative managers 45% Private sector managers 15% Professionals in handicapped education 13% Primary/Intermediate education teachers 5% Civil servant clerks 4% Administrative clerical workers 4% Educational lab technician 4% Professionals in high education 2% Protective workers, guards, and messengers 2% Professionals in law 1% Kindergarten teachers 1%


In addition to the occupations listed in the table above, respondents identified a large number of other occupations present in the education sector including, dieticians, administrative specialists and general cleaning workers.

Table 6.8 shows an indicative forecast to 2012 of second-tier occupations that apply to the education sector. The indicative forecast is based on the following method:

• initial results were drawn from the employer survey at the second-tier level

(up to 117 occupation categories). 67 per cent of education employers who participated in the survey responded to the second-tier related questions

• for the education sector, the key second-tier occupation categories were

compared to relevant ILO statistics for the United Kingdom in 2007 as a proxy (and in some cases compared to Bureau of Labour Statistics data in the United States for 2008) to provide a benchmark to validate the forecast. A benchmark was unavailable to be drawn from for Bahrain or any other GCC State (International Labour Organization 2007).

• qualitative evidence was drawn from the existing information available for the

education sector and the outcomes of the stakeholder consultations undertaken as part of the Skills Gaps Research Study

• the key limitations for the results in the education sector are that the

respondents to the second-tier occupation categories were 67 per cent of the total sector responses and that the survey responses were only from private sector education employers, as a result the public education sector and associated occupation gaps was not represented in the initial forecasts for 2012.

It is important to note that these employee numbers are indicative only and should not be used for any other reason than to identify the magnitude of the occupation gap in 2012 based on the method outlined above. These numbers should not be used as ‘actual’ numbers of employees. Definitions for the occupations identified in the table below are provided in Appendix B.



Table 5.6 SECOND-TIER OCCUPATIONS (INDICATIVE FORECAST 2012) — EDUCATION

Second-tier occupation Indicative forecast 2012

Proportion of total forecast

occupation gap

Primary/Intermediate education teachers Inc ludes: professionals in education professionals in secondary education

360 31%

Professionals in handicapped education 200 18%

Professionals in high education Inc ludes: professionals in education in private institut ions

Administrative clerical workers Inc ludes: civil servant clerks secretaries

150 14% 130 12%

Administrative managers 110 10%

Educational lab technician Inc ludes: education methods technician

60 5%

Private sector managers 40 4%

Protective workers, guards, and messengers

30 3%

Professionals in law 20 2%

Kindergarten teachers 10 1%

Total indicative occupation gap in 2012 1 110 100%


The main group of employees in the survey, education providers, earn on average, lower wages than those employees in the same job in another sector (BD480 compared to BD570 in other sectors). On the other hand, administrative service and other employees tend to earn a higher average wage than those in the same positions across other sectors (BD430 compared to BD380 for administrative service positions and BD350 compared to BD262 for all other occupations). The average monthly wages for the top three occupational groups in the private education sector are represented graphically in Figure 12.6.



Figure 5.14 A WAGE COMPARISON — EDUCATION COMPARED TO ALL SECTORS


Only one-fifth of private education providers were content with the number of employees in their organisation. Factors that restrained employers from recruiting more staff include a shortage of good candidates, experienced by 26.7 per cent of employees, a lack of financial resources, a problem for 20 per cent of employers, difficulties attracting candidates to their organisation, a difficulty for 13.3 per cent of organisation and difficulties attracting candidates to the location, which was experienced by 6.7 per cent of organisations.

New recruits to the education sector compare well to the recruits of the previous two years. None of the provide education employers find that in terms of technical and generic skills standards, neither Bahraini or non-Bahraini recruits are of a lower standard. Furthermore, 26.7 per cent of employers responded that Bahraini recruits were of a higher standard in terms of generic and technical school than two years ago and 13.3 per cent of employers felt this way about non-Bahraini recruits.

The majority of private education employers (60 per cent) provide in-house training. In-house training is provided in the form of induction training for 53.3 per cent of employers, administration training is provided by 26.7 per cent of employees and technical training is provided by 46.7 per cent of employers. Other sources of training are from external sources within Bahrain, 40 per cent of private education employers provide this and external sources from overseas, 33.4 per cent of employers provide this training for their employees.

When recruiting in the private education sector employers are attracted by customer numeracy skills and emotional skills in employees. Literacy skills are also highly valued. In contrast, a low priority is given to physical skills and to some degree, technical ‘know-how’ skills. Figure 13.17 shows the importance of work related skills to employers in the private education sector.



Figure 5.15 IMPORTANCE OF WORK-RELATED SKILLS


Private education organisations also identified the top five skills required in the sector, which are outlined in Table 11.6. The most commonly identified skill required in the private education sector was communications skills (15 per cent of total responses) and leadership and management skills (15 per cent).

Table 5.7 TOP 5 SKILLS — EDUCATION

Skill type Proportion of total responses

Communication Skills 15%

Leadership and management skills 15%

Teaching skills 12%

Personal skills 6%

Emotional skills 6%


In the near future private education employers have indicated that as a sector they intend to create 650 jobs over the next five years mainly for education provider positions. Although this will be important to the sector, this number of jobs is modest compared to the aggregated responses from the business and manufacturing sectors.

Employee survey

Of the employee survey responses, 7 per cent worked in the education sector. Of these employees, 48 per cent were education providers/professionals and 19 per cent were administrative services workers (Figure 5.16).



Figure 5.16 OCCUPATIONS OF EMPLOYEES — EDUCATION


Approximately two-thirds (67 per cent) of the 69 education sector participants were female. The largest subset (33 per cent) was in the 25-29 year age group, with 77 per cent of all participants under 34 years of age (Figure 3.15). Of the 69 participants, about 62 per cent were born in Bahrain.

Figure 5.17 AGE OF EMPLOYEES — EDUCATION


Almost 50 per cent of the 69 participants were married. Also, the largest subset of these participants (43 per cent) had completed a Bachelor degree, and another large subset had completed a Masters degree (20 per cent) (Figure 5.18). The two largest subsets reported monthly earnings of BD400-499 (20 per cent) or BD500-599 (19 per cent) per month. Overall, participants from the education sector reported higher monthly earnings than all sectors combined, with 48 per cent from the education sector earning BD500 or over a month compared to 36 per cent for all survey participants (Figure 5.19).



Figure 5.18 EDUCATIONAL QUALIFICATIONS OF EMPLOYEES — EDUCATION


Figure 5.19 EARNINGS OF EMPLOYEES — EDUCATION


Survey participants from the education sector also commented on the skills that they see as important for their jobs (now and in the future). The top five skills sets (out of 12 skills sets) that participants as a whole regarded as highly important to their work were literacy, work communication, checking skills, problem solving skills and customer communication (see Figure 5.20). As expected, participants with postgraduate qualifications or employed in management positions were more likely to value management skills than those with at lower levels.



Figure 5.20 TOP FIVE SKILLS OF IMPORTANCE TO EMPLOYEES — EDUCATION


In addition, survey participants highlighted attitudinal characteristics that they found influential in a job. Respondents from the education sector found that remuneration was the most influential characteristic (Figure 5.21).

Figure 5.21

EMPLOYEE ATTITUDES ABOUT WORK — EDUCATION


Graduate survey

Just over half (26) of the 50 graduates of education courses who completed the graduate survey intended to work in the field that they were trained in. The skills ranked most highly by these graduates were persuasive skills, emotional skills, work communication, literacy skills, and problem-solving skills (Figure 5.22).



Figure 5.22 IMPORTANCE OF SKILLS TO GRADUATES (MEAN RANK) — EDUCATION


Graduates were also asked to indicate attitudinal characteristics that would influence their decision to take a job. Similar to employee participants from the education sector, graduates were highly influenced by remuneration. The main difference in attitudes was that graduates valued work-life balance more highly than did employees (Figure 5.23).

Figure 5.23

GRADUATE ATTITUDES ABOUT WORK — EDUCATION


Key stakeholder consultations

Most stakeholders pointed to Bahrain’s proven success in the financial and banking sector, arguing that this provides a model of a highly competent and productive workforce and for other sectors in terms of co-ordination of supply and demand, global and regional integration, technological transfer, and sustainable Bahrainisation.



In Bahrain as elsewhere, public and private education institutions are the major suppliers of labour. The key stakeholders in the labour market expect education institutions to equip their workers with the competencies required to be productive in their industry. In most large-scale government and quasi-government (e.g., banking and finance, oil-gas), there seem to be few major supply problems, and indeed Bahrain is actually a supplier of quality graduates in the GCC in areas in which it has been traditionally strong. As the LMRA put it “of course, there are some specific skills needs, but there seems to be no overall skills gap. One must ask which skills in which occupations, and one must also learn how to utilise untapped strengths and provide a range of viable options that are attractive to graduates (particularly young women) not in the workforce.”

As in most countries, employers complain about the quality of education by educational institutions. The outcomes achieved at higher levels are patchy. For example, employers are generally satisfied with the quality of graduates in the business and finance sector, but they are critical of the standards achieved by arts, social sciences and education graduates. A number of stakeholders also complain that the government is “still absorbing unemployable graduates.”

Stakeholders in the industrial sector complain that there is “an upside down pyramid” created by the expansion of university education and a decline in the provision of technical training at all levels leading to an undersupply of engineers, technologists and middle level technicians.

A few key stakeholders argue that the focus on supply tends to lead to many of the “real problems in labour demand being ignored”. Youth unemployment is not simply the product of skills shortages, but of demand in a context where many employers in the private sector opt for low paid non-Bahrainis, particularly in the construction sector.

Another theme emerging from stakeholder consultations is the lack of career education and counselling, career development and on-site training and mentorship. Large public and private sector employers argued that providing career counselling, public awareness programs and guiding students are important in addressing youth unemployment and career development. Stakeholders also called for greater involvement of employer groups in the design of Vocational Education and Training (VET) and higher education programs, in defining and setting standards and in accreditation of institutions and courses. They felt that this would lead to greater emphasis being placed on VET and other soft skills.

Other stakeholders identified that the quality of education was a challenge in Bahrain however, this did not represent a quality issue overall for higher education. They also identified that although there is a high degree of completion at the Bachelor degree level there needs to be more specialised degrees in various areas.

Attendees at the Regional Skills Gaps Conference held in November 2008 confirmed many of the concerns of stakeholders. These include:

• improving the link between meeting skills gaps, the education system and

education reforms

• providing training assistance to both the private and public sector to ensure future labour market development



• providing training in the form of both external training facilities and courses as well as on-the-job training

• improving the quality of education by offering skills subjects and not just

academic subjects; having in place appropriate quality assurance process and regulations

• improving numeracy, literacy and communication skill levels of those students

enrolled in private and public schools, as well as embedding ‘soft skills’ such as interpersonal and problem solving skills into teaching activities; it was suggested that the strengthening of these skills should be undertaken at the intermediate or lower level of education

• greater emphasis on technical training for specific professions rather than

general strategies across sectors, which could include apprenticeship training

• addressing the lack of graduates with the skills that the labour market demands by improving links between industry and academia; it was suggested that a mandatory scheme be introduced to accommodate apprentices

• greater efforts to attract students to courses where demand for their labour is

high

• increasing awareness of career options and pathways through counselling and public education campaigns.

5.6 Skills gaps analysis

The education sector can be considered in two dimensions:

• as a sector in its own right

• as Bahrain’s main labour market skills provider the gaps are apparent in these two dimensions.

As its own sector the skills gaps apparent within Bahrain’s education sector are for specialised areas of higher and tertiary education including science, maths, technology and vocational areas.

Broader skills gaps areas that are direct to other industries point to skills gaps within the education sector because as previously stated, it is Bahrain’s main skills provider. These types of skills gaps include:

• higher education teaching skills — while overall there seems to be an adequate

supply of education graduates for primary education, there are skills gaps in specialised fields of education (such as early childhood, secondary, technical and higher education; curriculum and assessment; educational planning)

• technical training skills — which is reflected in the general shortage of

engineers, technologies and middle level technicians

• career development skills — including careers development issues such as careers counselling and provision of on-site training

• education administration skills — including skills required by education

managers (principals, directors, deans), and administrative skills.




• 650 education providers

• 400 administrative services staff

• 350 other education related workers.

Stakeholders indicated that some areas within the education sector suffered from shortages. These were the specialised areas within higher and tertiary education of science, maths, technology and vocational areas.

General skills shortages affect the education sector indirectly, as main provider of skills to Bahrain’s labour force. Specifically, there is a shortage in technical training that has led to an undersupply of engineers, technologist and middle level technicians in Bahrain. More generally, there is a lack in expertise for the provision of on-site and on-the-job training within the workplace for employees.

Skills gaps in providing careers development training and support are related to the limited availability of on-the-job training. The education sector lacks in its ability to provide careers counselling, training and support geared towards career development. These skills shortages may be related to such trends as high youth unemployment a significant proportion of graduates not working upon concluding study. In addition stakeholders noted that females, the dominant graduate demographic, are generally not maximising their skills within the workplace.

Literacy and numeracy is a skill gap for certain groups within the population that is the responsibility of the education sector. Illiteracy rates are apparent within the older Bahraini demographic and the non-Bahraini population. More broadly, adult education is a potential skills gap to develop within Bahrain as the range of skills required to function effectively in the workforce are changing and rising. The education sector needs to provide options for workers to continue their education, especially those with difficulties finding employment.

Primary enrolment, secondary school enrolment and secondary enrolment in public technical and vocational program levels show parity between male and female students whereas tertiary enrolments from 1999 and 2003 to 2006 have shown females to dominate this sector. Further, females dominate the numbers of graduates in all fields of study aside from engineering, manufacturing and construction.

The low proportion of males enrolling in tertiary education is a demographic issue that may challenge Bahrain’s ability to address its general skills gaps. Males and females generally have parity in enrolment rates until they approach university. Females dominate the number of graduates in Bahrain and student levels, however, male graduates are more likely to work. This is likely to be more subject to demand and not to gender. However, it shows there is a mismatch between education levels and workforce participation.



Comparing the benchmark projections of employees at each level of education with the qualifications profile of survey participants shows that survey participants were slightly more likely to report a Bachelor degree (43.5 per cent compared to a benchmark projection of 41 per cent and a Certificate/Diploma (16 per cent compared to a benchmark projection of 5 per cent for a Diploma). However, survey participants were less likely to report a Masters degree (20 per cent compared to a benchmark projection of 31 per cent) and having completed secondary education (4.3 per cent compared to a benchmark projection of 7.7 per cent).

The key skills gaps identified for the education sector are summarised in Table 5.8, including the sources from where the skills gaps have been highlighted.

Table 5.8 SKILLS GAPS SUMMARY — EDUCATION SECTOR

Study input Higher education

teaching skills

Technical training

Human resources skills

Education administration

Labour market analysis û û ü û Qualifications analysis û û û û Survey of employers û û û û Survey of employees û û ü û Survey of graduates û û û û Survey of Education Institutes û û û û Key stakeholder consultations ü ü ü û

Other information sources ü û û ü


5.7 SWOT snapshot

On the basis of the analysis above, a snapshot of the strengths, weaknesses, opportunities and threats to the education sector in Bahrain has been completed (see Table 5.9). This summarised information will be used to inform action plans for a small number of sectors in Report 4.



Table 5.9 SWOT — EDUCATION

STRENGTH WEAKNESS • Most employees in the education system have higher

education qualif ications • Almost all Bahrainis complete secondary education,

one of the highest rates in the world • Literacy rates are high by GCC and internat ional

standards • Highest participation rates in vocational and tertiary

education in the region • EDB Education Reform projects regarding

development of eduction to improve quality and relevance of education and training

• Tamkeen funds train 11,000 Bahrainis for skilled positions dominated by non-Bahrainis

• Training levy to support vocational training programm es

• Highly competitive and productive workforce in financial and banking sector

• Education system is not aligned with the needs of the labour market - talent pool in Bahrain lacks the skills and work ethic expected of employers

• Over supply of female general education graduates • Skills gaps in specialised fields of education (e.g.,

sciences, maths) filled by non-Bahrainis • Many students leave education lacking basic skills • Small amount of time devoted to maths, science and

technology • Quality of teaching and standards patchy – lack

effective quality assurance system • Lack of vocational education, guidance and work

experience programs • Almost half of BTI graduates in 2007 not working three

months after graduating • Contribution of education sector to GDP has fallen to

2.6%

OPPORTUNITY THREAT • Increasing opportunities for higher education students

to engage in on-the-job training • Investing in programs in Islamic economics, banking

and finance; paramedical and health; and the petrochemical industry

• Co-ordinated and more coherent education reforms link Bahrain more closely to the global and regional econom y

• Career counselling and public awareness programs raise the profile of the sector and reduce mismatches

• Recession leads to drop in demand for non-Bahraini workers and creating opportunities for qualif ied Bahrainis

• Unable to keep up with global reforms in education, such as teaching quality, accountability, performance standards, university-industry links

• Industry continues to rely on non-Bahrainis for expertise aligned to their needs

• Non-Bahrainis account for two-thirds of new jobs created between now and 2012.

• Supply-demand mismatches worsen as economic recession and falling oil prices hit private sector and limit capacity to create jobs in public sector

• Cultural factors continue to restrict Bahraini fem ale involvement in private sector & utilization of their skills


5.8 Future skills issues

Key challenges facing Bahrain’s education sector are:

• the quality of education that is hindered by problems in basic skills outcomes from schooling. At higher levels, there is an over-supply of humanities-social science graduates who often are lacking employability skills, and a shortage of science, mathematics, technology and nursing graduates

• barriers to participation in the education sector: the public sector is virtually

full, yet there is a shortage of well-qualified and competent teachers in areas sought by private sector employers. The economic downturn could see an exodus of well-qualified non-Bahrainis teachers, academics, and specialist educators



• capacity for growth and competition, mainly at tertiary level. VET, paramedical and health, petrochemical industry, and Islamic finance and economics could be attractive to other GCC countries if quality assured. The reputation of the higher education system is low given the bad press about some poor quality private higher education institutions. To restore confidence, tough action (e.g. closure) may be needed

• difficulties in ensuring a supply of graduates and recruiting them into teaching

in areas where there are mismatches between supply and demand such as early childhood, VET, mathematics, science and technology.



Chapter 6

Health


The Bahrain health care sector is largely dominated by the public sector. The public sector is administered and financed through the Ministry of Health. There is also a small but prominent private sector with an increasingly important role in line with growing demand pressures that are being placed on health services. Bahrain’s health care facilities are modern and well equipped with one major construction project currently underway — the King Hamad hospital, which aims to cater for future health care demand. Bahrain’s health facilities also play an important role in health training and education and will be increasingly important as the health sector continues to develop.

The health status of Bahrain as a country is high and health service accessibility covers almost 100 per cent of the country (World Health Organization Regional Office for the Eastern Mediterranean 2006). Further, the health status of Bahraini women is high due to a combination of awareness of health needs through free health care, high education levels and high living standards (Keddie 2006).

Table 6.1 provides selected vital health statistics of Bahrain. The birth rate has fallen from 2003 to 2007 as has the maternal mortality rate and the crude death rate. The infant mortality rate, however, has risen. The life expectancy rate at birth has risen over the 5 year period from 74 to 75 years. In addition, there has been significant success in eradicating most communicable diseases in the past decade. However, chronic (non-communicable) diseases have emerged as the critical health concern for the nation. The continuation of this health concern over time will prove the need for greater health services, to be provided by a skilled health workforce.

Table 6.1 VITAL HEALTH STATISTICS — 2003 AND 2007

2003 2007 Crude birth rate/1000 population 21.1 15.4

Infant mortality rate/1000 live births 7.3 8.3

Maternal mortality rate/100 000 live births 20.6 18.8

Under 5 years mortality rate/ 1000 child under 5 years 2.2 2.2

Crude death rate/ 1000 population 3.1 2.2

Life expectancy at birth 73.8 74.8

Source: (Health Information Directorate 2008).



The World Health Organisation (WHO) notes that the prevalence of non- communicable diseases such as cardiovascular disease, diabetes, cancer as well as major injuries is increasing and have become the leading cause of death in the Bahrain (World Health Organization Regional Office for the Eastern Mediterranean 2006). Although this is in tandem with the global trend, it is a health issue more particular to the Middle East, which can, for example, expect to see an increase of 163 per cent in diabetes prevalence within the populace between 2000 to 2030 (Wild, Roglic et al. 2004). This is the highest increase of the regions, with the world increase in diabetes projected at 114 per cent. These trends will add significant pressure to health care financing and will be the main health concern for Bahrain in the future with a likely result in greater demand for health services.

Health services

Demand for hospital services has increased in Bahrain (Table 6.2). Both the government and private sector have been subject to an increase in patients over the five year period 2003 to 2007. The number of patients in the private sector grew at a much higher rate than in the government sector (123.6 per cent increase in inpatients and 63.3 per cent increase in outpatients compared with a government increase of 3.2 per cent in inpatients and 15.4 per cent in outpatients). The growth in private health service is greater than population growth over the same time period (35.9 per cent), but growth in public health services was lower than population growth, showing an overall increase in health service demand over this time period (Central Bank of Bahrain 2008).

The public sector is still much more heavily relied upon for hospital services. A challenge for the health sector will be to continue to maintain and improve Bahrain’s health status in the face of continual demand increases in the future. In terms of skills, this situation will require a growing health workforce with continuously improving skills.

Table 6.2 PATIENT STATISTICS — 2003 AND 2007

Year Inpatients Outpatients Government Private Government Private

2003 77 710 8387 3 766 354 420 463

2007 80 219 18 751 4 349 224 686 734

Growth 3.2% 123.6% 15.4% 63.3%

Source: (Health Information Directorate 2007; Health Information Directorate 2008).

Bahrain’s health care facilities comprise of:

• 9 government hospitals (including maternity hospitals)

• 23 government health centres

• 12 full service private hospitals

• other clinics, poly-clinics and specialist centres (Health Information Directorate 2008).



Ministry of Health

The Ministry of Health, as mentioned, plays a dual role of health care provision and regulation. Under the current system, cost sharing with patients varies according to nationality, employer size and type of health care provision. Bahraini nationals public health care is fully financed by the Ministry, but circumstances are different for other groups. For example, expatriates are charged nominal fees for using the healthcare system, and private employers with more than 50 employees are required to pay annual fees for heath care services.

The organisational structure of the Ministry divides into 4 main policy areas of responsibility:

• primary care and public health

• secondary care

• finance and human resources

• planning and training.

As the main health services provider, the Ministry employs the majority of the health workforce — 90 per cent of the total health workforce in 2005 (World Health Organization Regional Office for the Eastern Mediterranean 2006).

In 2002, the Ministry introduced the Bahrain Health Strategy to provide overarching direction to health services from 2002 to 2008, outlining the current state of play, 12 strategic goals and actions to move forward. The strategy’s goals (listed in Box 6.1) have the purpose of guiding the developmental process of the health sector and services delivered. The goals of human resources and education, research and development are the most relevant to the future skills needs in the health sector.

Box 6.1 STRATEGIC GOALS

• Health gain — reduce the burden of disease • Quality, clinical excellence and performance improvement — improve the quality

of responsiveness of services and strengthening the role of the Ministry of Health as health regulator

• Primary care development — promote the role of the family and delivering promotion, prevention, curative, rehabilitation and palliative services

• Service development — develop an integrated model of health care provision • New investment — develop a structured approach to investment • Partnership working — develop local, regional and international partnerships • Community involvement — encourage people to take responsibility for their own

health • Organisation and management — ensure the appropriate organisational structure is

in place to implement the Strategy • Human resources — strengthen the management and workforce planning of human

resources • Education, research and development — develop the role of health services in

education and establish linkages • Financial management — develop financial management skills • Information and communication technology — develop ICT systems

Source: (Ministry of Health 2000).



The Ministry as part of its current strategy has determined key actions that are required to ensure success by 2010 — ‘critical success factors’ necessary for the health sector to achieve its goals. The critical success factors include: supporting development thought performance monitoring and evaluation; and generating a culture of general and project management (Ministry of Health 2000). Such a culture will only be possible with the necessary skills to undertake monitoring, planning and evaluation tasks.

Of all public hospitals, Salmaniya Medical Complex is the main government secondary and tertiary health care facility in Bahrain and it provides the most advanced medical care in the country. The complex has been expanded several times over the past 4 decades and it provides an extensive list of services for both inpatients and outpatients (World Health Organization Regional Office for the Eastern Mediterranean 2006).

The King Hamad University Hospital, set to open in 2010, is noted as one of the largest health sector projects in Bahrain in recent times. The hospital will have 312 beds, 227 000 square metres of modern medical facilities and it will become the main teaching hospital and location for the Medical University of Bahrain as well as providing general medical and hospital facilities. The hospital will include specialised departments and the Royal College of Surgeons in Ireland (RCSI) is expected to manage and operate the hospital after its opening in cooperation with the Ministry of Health (B-I-G Magazine 2008).

Private health services

Bahrain’s private health care sector is poised to take on a more prominent role both in health care provision and health tourism in the coming years. The private health sector has been recognised as a component in Bahrain’s future Economic Vision of 2030. Bahrain’s goal is to be a leader in modern medicine with a health system that will cater for the health care needs of the growing and ageing population (Bahrain Economic Development Board 2008).

As a key player in health care provision, the private sector already consists of 12 hospitals and other facilities that are operated by numerous international and local non-profit organisations as well as corporations. Of the private sector hospitals, the American Mission Hospital, with 40 beds, has the largest patient turnover with 186 294 outpatients in 2007 (Health Information Directorate 2007).

In addition to health care provision, the private sector began its role as a health education provider with the opening of RCSI-Bahrain in 2006. Currently, the international branch provides medical and nursing degrees but there are plans to add other disciplines such as pharmacy, physiotherapy, dentistry and health care ethics and law.

Job creation and wages

Wages in the private health sector are highly dependant on demographic group. Table 6.3 shows the average private sector earnings of hospital, health centre and clinic employees by nationality and gender in 2006. Male Bahraini employees earned the highest wage in March 2006 of BD530 per month. This group was followed by non-Bahraini males, non-Bahraini females and earning the least, Bahraini females, of BD247 per month. Bahraini males earn more than double Bahraini females in this sector and non-Bahraini employees earn, on average, a



higher wage than Bahraini employees (BD450 per month compared of BD353 per month).

Table 6.3

AVERAGE PRIVATE SECTOR EARNINGS (BD) OF HOSPITAL, HEALTH CENTRES AND CLINIC EMPLOYEES BY NATIONALITY AND GENDER — MARCH 2006

Bahraini Non-Bahraini Bahraini & non-Bahraini

Female 247 399 323

Male 530 490 502

Both sexes 353 450 410

Source: (Labour Market Regulatory Authority n.d.).

Job creation and wages in the private sector indicates the growth and characteristics of the sector, which is important to the future of health care in Bahrain. From 2004 to 2007, there were more jobs created where non-Bahrainis were employed compared to Bahrainis (531 jobs compared with 118). Of the health jobs created in 2006-07, a greater proportion of jobs created for Bahrainis were ‘high paying’ jobs (with wages of over BD500 per month) at 6.7 per cent compared with 1.5 per cent of jobs classified as ‘high paying’ for non-Bahrainis (Labour Market Regulatory Authority 2008b).

6.2 Health in Bahrain

Figure 6.1 indicates the size of the health sector in Bahrain. In 2007, the health sector contributed BD97.4 million (1.4 per cent) to GDP, an nominal increase from a contribution of BD72.1 million (2.3 per cent) in 2002, however, the contribution of the health sector to GDP as a percentage declined. Further, whilst workers in the sector (10 416) made up 2.1 per cent per cent of the total labour force in 2007, a decrease from 2.7 per cent in 2002 there was an increase in the number of total employees for the sector.

Figure 6.1

HEALTH AS A PROPORTION OF GDP AND LABOUR FORCE — 2002 TO 2007




Challenges to the health sector

While Bahrain has been acknowledged as having high health standards, the health sector needs to maintain momentum to cater for a growing demand on health care services. Two main challenges present potential barriers to the development of skills in the health sector:

• a shortage in technically skilled employees

• limited management, administration and evaluation capabilities.

These challenges have been identified within Bahrain and the WHO gave external recommendations on solutions to these challenges in 2005. More recently, the Ministry has worked with international partners such as the Canadian Council for Health Accreditation to improve the medical system overall, and Australian and United States regulators to address regulatory issues.

Bahrain, similar to other GCC States, is experiencing a shortage in skilled health care personnel, which may be exacerbated by an increasing population in years to come. A shortage in personnel is already visible in the scope of health service provision, which currently does not completely cater for specialised health problems such as muscular skeletal disorders, some forms of cancer and diabetes — chronic diseases that are the most prominent health issue in Bahrain. Modeling in 2000 predicted that in 2005 doctors would provide 82.5 per cent of medical demand (Ahmed, Fateha et al. 2000). The medical professional shortage could potentially hinder the growth of the health sector (and in particular the private health sector).

Further, Bahrain needs to develop expertise in management, coordination and research to improve the health system in general. Currently the culture of the health sector in Bahrain sees shortages in monitoring, evaluation, analysis and human resources planning. More broadly, the WHO recommended that Bahrain plan for human resources development in health on a national scale. The WHO notes that the plan should include definitions of the nature and size of the health workforce. Planning for human resources development also needs to incorporate linkages with other bodies that can benefit the health sector such as education institutions and the Civil Service Bureau (World Health Organization Regional Office for the Eastern Mediterranean 2006).


Both the public and the private sector participate in providing health education in Bahrain. The education institutions in the health sector are key to attracting nationals to work in the medical profession. To provide further incentive, the government developed a program to recruit Bahraini nationals to the health sector and educate them internationally. This program has also contributed to a higher proportion of Bahraini nationals in the health sector compared with other GCC States. There are four health profession education institutions in Bahrain. These are:

• AMA International University — College of Medicine

• Arabian Gulf University — College of Medicine

• Ministry of Health — College of Health Sciences. In 2007, there were 769

students enrolled in a nursing program and 260 students enrolled in allied health courses (Health Information Directorate 2008)



2

• RCSI — Medical University of Bahrain — College of Medicine and School of Nursing. In 2007, the Medical University of Bahrain has 178 students enrolled in medicine and 41 students enrolled in nursing (Health Information Directorate 2008).

Bahrain committed to a focus on education and skills in the Bahrain Health Strategy. Goal 10 of the strategy emphasises the importance of health education and research for the sector. In addition, education is woven into the other goals and is a prominent theme of the strategy.

6.4 International trends in health

Bahrainis enjoys a high level of health. In the World Health Report 2000, Bahrain ranked number 30 in terms of level of health, however, Bahrain’s health system ranked number 42 in terms of performance which is indicative of the known limitations in the system (World Health Organization 2000) . Compared with its status on the human development index, a rank of 41 in 2005, the history of its achievements and the resources available to health, ratings on the non-health indicators of health system performance were lower than expected (World Health Organization Regional Office for the Eastern Mediterranean 2006).

This section discusses the regional personnel shortage, places Bahrain’s health education capabilities in a regional context and compares the health expenditure and health human resources of Bahrain with GCC members and three comparison countries — Singapore, Ireland and Sweden.

The Gulf region is facing a shortage in medical professionals more severe than the rest of the world. National medical graduates numbers are not keeping up with the demand for health services. The WHO notes that the Gulf regions are experiencing nurse shortages and there is a ‘noticeable shortage of Bahraini nurses and of doctors in certain specialisations and sub-specialisations’ in Bahrain (World Health Organization Eastern Mediterranean Regional Health System 2008). As such, the Gulf medical workforce is characterised by high numbers of expatriate physicians and nurses, and GCC patients are more often being treated internationally. However, the proportion of expatriate medical professionals in Bahrain is much lower than the GCC average (World Health Organization Eastern Mediterranean Regional Health System 2008).

Table 6.4 shows key health service resource indicators of GCC States, providing a regional health resource comparison. Overall, Bahrain has high quantities of health resources in the GCC. Compared with other GCC States, Bahrain spends the greatest proportion of general government expenditure on health and ranks second to Qatar in terms of health expenditure as a percentage of GDP. Bahrain also ranks second to Qatar in terms of per capita government expenditure on health. In the health workforce, Bahrain has the highest rates of hospital beds per 10 000 population, nursing and midwifery personnel and physicians compared to the other GCC States.

2 Health system performance has not been globally evaluated by the WHO since 2000 and so this comparison is the most recent international comparison available.



Table 6.4 KEY HEALTH SERVICE RESOURCES INDICATORS

Indicator Bahrain Kuwait Oman Qatar KSA UAE

General government expenditure on health as a percentage of total government expenditure (2005)

10.0

6.2

6.1

9.7

8.7

8.6

Total expenditure on health as a percentage of GDP (2005) 3.8 2.2 2.5 4.1 3.4 2.6 General government expenditure on health as a percentage of total expenditure on health (2005)

66.5

77.2

85.0

78.0

76.2

71.6

Per capita government expenditure on health (PPP $) (2005) 621 378 332 1 001 434 447 Hospital beds per 10 000 populationa 27 19 21 25 23 18 Nursing and midwifery personnel per 10 000 populationb 61 37 37 60 30 35 Physicians per 10 000 populationc 27 18 17 26 14 17

Source: (World Health Organization 2008a). Note: aData for Bahrain, Oman and Qatar is from 2006, data from Kuwait, KSA and the UAE is from 2005. Note: bData for Bahrain, Kuwait, Oman and Qatar is from 2005, data from KSA is 2004 and data from UAE is for 2002. Note: cData for Bahrain, Kuwait, Oman and Qatar is from 2005, data from KSA is for 2004 and data from UAE is 2002. Note: Physicians includes generalists and specialists.

A comparison with selected international jurisdictions (some of the comparison countries used in Report 1) places Bahrain’s performance in a new context. Table 6.5 shows that compared to other international jurisdictions, the Bahraini government ranks moderately in terms of health expenditure as a proportion of total government expenditure. In 2005, Ireland spent 19.0 per cent of government expenditure spent on health as a proportion of total government expenditure and Singapore spent 5.6 per cent of GDP on health. Placed in between these two countries, Bahrain spent 10.0 per cent of total government expenditure on health.

Bahrain has a relatively small public health sector compared with Ireland and Sweden, but not Singapore, whose public health sector is half the size of Bahrain’s. The proportion of government sector expenditure in Sweden is 81.7 per cent. By comparison, the Bahraini government contribution to total expenditure on health is 66.5 per cent.

The total size of the health sector is small in Bahrain compared with other jurisdictions, but is, again, larger than that of Singapore, whose health sector comprises 3.5 per cent of total GDP. Bahrain’s health sector comprises 3.8 per cent of GDP in 2005. In contrast, the selected European countries health sectors comprise between 6.2 and 9.2 per cent of total GDP.

In terms of health care facilities and staff, the comparison countries generally had more health care facilities and human resources than the GCC States. In 2006, Ireland had 56 hospital beds per 10 000 population compared with 27 in Bahrain, the best GCC State for this indicator. In terms of nursing and midwifery staff, Bahrain had less than Ireland and Sweden, but more than Singapore. Further, Bahrain had 27 physicians per 10 000 population in 2005, more than Singapore (15 physicians per 10 000 population), but less than Sweden and Ireland (with 33 and 29 physicians per 10 000 populations respectively).



Table 6.5 KEY HEALTH SERVICE RESOURCES INDICATORS

Indicator Bahrain Ireland Singapore Sweden

General government expenditure on health as a percentage of total government expenditure (2005) 10.0 19.0 5.6 13.6 Total expenditure on health as a percentage of GDP (2005)

3.8

8.2

3.5

9.2

General government expenditure on health as a percentage of total expenditure on health (2005)

66.5

79.5

31.9

81.7

Per capita government expenditure on health (PPP $) (2005) 621 284 363 2460 Hospital beds per 10 000 populationa 27 56 32 40 Nursing and midwifery personnel per 10 000 populationb 61 195 45 109 Physicians per 10 000 populationc 27 29 15 33

Source: (World Health Organization 2008a). Note: aData for Bahrain and Singapore is from 2006, data for Ireland is from 2005, data from Sweden is from 2000. Note: bData for Ireland is from 2006, data for Bahrain is for 2005, data for Singapore is 2003 and data for Sweden is from 2002. Note: cData for Bahrain, is from 2005, data for Ireland, Singapore and Sweden is from 2002. Note: Physicians includes generalists and specialists.

In addition to a comparison of health service indicators, there are significant trends in health workforce shortages that are common internationally. For example, there is a shortage of nurses that is expected to grow over the next decade (International Council of Nurses & Florence Nightingale International Foundation 2006). The nurse shortage is a significant issue for the medical workforce and health systems worldwide because nurses are the largest single group within the medical workforce.

Although most countries have incurred a nurse shortage at some previous stages, these have been cyclical in nature and generally caused by either:

• increased demand for nurses, or

• more slowly growing supply of nurses (International Council of Nurses &

Florence Nightingale International Foundation 2006).

The present nurse shortage differs markedly from past trends in that today’s health systems suffer from pressures exerted on both the supply and demand side (International Council of Nurses & Florence Nightingale International Foundation 2006).

Three trends contribute to the shortage of nurses on the demand side. These are aging populations in many developed countries, increasing population growth rates and a growing burden of non-communicable disease (International Council of Nurses & Florence Nightingale International Foundation 2006). On the supply side, inadequate human resources planning, migration, high attrition, low professional satisfaction and inadequate remuneration, impact of HIV/AIDS and under- investment in human resources have contributed to limit the number of nurses worldwide (International Council of Nurses & Florence Nightingale International Foundation 2006).



Bahrain’s health sector performs well in terms of resources, financing and labour shortages compared to other GCC States. To continue to improve and prepare the sector for the future, Bahrain could aim to compare its performance on a more global scale against some leading countries. A comparison with OECD countries puts the human resources shortage and health expenditure figures into context as the selected countries spend more on health care and as a result perform better against key international health status indicators. Bahrain could continue to maintain its high reputation in health education facilities and standards — a strength of the current sector that could form a key aspect in developing skills in the future health sector.


This section discusses the future labour and skills needs of Bahrain’s health sector with reference to labour market and qualifications analysis, key results from the employee and employer surveys, and key stakeholder consultation.


In Bahrain, general health sector employment trends show an increase in total employment between 2002 and 2007 — from 7 589 in 2002 to a total labour force of 9 563 in 2007. As Figure 6.2 shows, there were more non-Bahraini employees than Bahraini employees in the private sector, but in the public sector, the number of Bahraini employees was significantly greater than non-Bahraini employees.

According to the analysis below, growth in the private sector from 2006 to 2007 was 7.1 per cent for Bahraini employees (12 employees) and 14.8 per cent for non- Bahraini’s (71 employees). Other data sources show that in this period, the total number of jobs in the health and social work private sector decreased by 33.2 per cent (143 jobs) for Bahrainis and by 7.3 per cent (101 jobs) for non-Bahrainis (General Organization for Social Insurance (GOSI) 2008).

Figure 6.2

MINISTRY OF HEALTH — 2002 TO 2007

Source: (Civil Service Bureau (CSB) 2008a; General Organization for Social Insurance (GOSI) 2008).



Projections for future employment in the health sector (see Figure 6.3) show that the number of jobs in 2012 will have increased to 11 291 (an 14.4 per cent increase compared from 2008). However, employment for total non-Bahrainis will grow by 36.6 per cent compared with only 12.6 per cent for Bahraini nationals. From 2008 to 2012, the public sector is projected to grow by 13.7 per cent whereas the private sector is projected to grow by 22.0 per cent in this period.

Figure 6.3 MINISTRY OF HEALTH — 2008 TO 2012


Qualifications analysis

In terms of qualifications, the employee survey results show that the majority of employees in the health sector had completed a diploma (48.5 per cent), with a much smaller proportion of respondents completing a Bachelor degree (15.2 per cent) (see Figure 6.4).

Figure 6.4

QUALIFICATIONS — HEALTH




In terms of Bachelor and Diploma qualifications, data from the College of Health Sciences identifies that in 2009, the vast majority of graduates would have a Bachelor of Nursing of a qualification as a hospital aid. However, these is a prediction that by 2011, there will be a small number of graduates in public health, medical lab technicians, radiography and pharmacy and dental hygiene (College of Health Sciences 2009).

Forecast qualifications gaps in the health sector between 2008 and 2012 are expected to be for employees with a bachelor degree (29.4 per cent of the required qualifications, equal to 900 jobs) but importantly, the qualification gaps for Bahraini employees will be employees with secondary school, diplomas and PhD qualifications. The results of the employee survey are also in line with these findings.

Employee and employer survey results

Employee survey

Health sector employees made up 3.4 per cent of total employee survey responses. Of these employees, 57.6 per cent described their job as administrative and 21.2 per cent as health professionals. Figure 6.5 displays how surveyed employees described their occupation.

Figure 6.5

EMPLOYEE CURRENT OCCUPATION DESCRIPTION


In addition, survey respondents highlighted attitudinal characteristics that they found influential in a job (see Figure 6.6). Respondents from the health sector found that remuneration was very highly influential (4.49 out of 5), as was the work environment (4.10 out of 5).



Figure 6.6 ATTITUDES ABOUT WORK — HEALTH


Employer survey

The employer survey comprised 13 organisations from the private health sector, representing 0.8 per cent of the total survey sample (there were no public health responses to the survey). These responses represent 533 employees or approximately 11 per cent of the private health labour market. Of the survey responses, around 26 per cent of employees were Bahraini and 74 per cent non- Bahraini, which is reflective of the fact the respondents were from the private health sector — the public health sector has significant Bahrainisation. Further, around 63 per cent of employees in the sector were female.

Positions held in the health sector differed according to gender and nationality (see Table 6.6). Surveyed employer responses indicate that non-Bahrainis were more likely to be health professionals than Bahraini employees, and that males (Bahraini and non-Bahraini) were more likely to be managers and business executives than females.

Table 6.6

HIGH-LEVEL OCCUPATIONS — HEALTH SECTOR

High-level category

Proportion of total responses Bahraini Non-Bahraini Male Female

Managers and business executives 19% 21% 39% 5%

Scientists and science technicians 0% 0% 0% 0%







Total 100% 100% 100% 100%




Considering these occupations further, when asked to provide information on occupations at more detailed level (second-tier level), employers identified most employees in the sector as nurses (40 per cent), other occupations (29 per cent) and professionals in medical science (13 per cent) (see Table 6.7).

Table 6.7

SECOND-TIER OCCUPATIONS (PROPORTION 2008) — HEALTH SECTOR

Second-tier occupation Proportion of total

sector responses

Nurses 40%

Other 29%

Professionals in medical science 13%

Administrative managers 4%

Secretaries 2%

Administrative clerical workers 2%

Other managers 1%

Dieticians 1%

General cleaning workers 1%

Private sector managers 1%

Dentists 1%

Heads of sections 1%

Physical therapy 1%


Table 6.8 shows an indicative forecast to 2012 of second-tier occupations that apply to the health sector. The indicative forecast is based on the following method:

• initial results were drawn from the employer survey at the second-tier level (up

to 117 occupation categories). 77 per cent of health employers who participated in the survey responded to the second-tier related questions

• for the health sector, the key second-tier occupation categories were compared

to relevant WHO statistics for Bahrain in 2007 as a proxy (and in most cases compared to the average across countries classified as ‘high income’, including Bahrain) to provide a benchmark to validate the forecast (World Health Organization 2008b).

• qualitative evidence was drawn from the exiting information available for the

health sector and the outcomes of the stakeholder consultations undertaken as part of the Skills Gaps Research Study

• the key limitations for the results in the health sector are that the respondents to

the second-tier occupation categories were 77 per cent of the total sector responses.




Table 6.8 SECOND-TIER OCCUPATIONS (INDICATIVE FORECAST 2012) — HEALTH SECTOR

Indicative forecast Proportion of total Second-tier occupation 2012 forecast

occupation gap Nurses 2 800 33%

Other Inc ludes: • medical sciences assistants • x-ray and medical planning technicians • medical laboratory technicians • drugs technicians • pharmacy technicians • traditional medicine technicians Professionals in medical science Inc ludes: • surgeons • professionals in pharmacology • pharmacists

2 700 32%

1 100 12%

Administrative m anagers Secretaries Administrative clerical workers

500 6%

250 3%

200 2% Other managers

Inc ludes: • supervisors of sections

150 2%

Dieticians General cleaning workers Private sector managers

130 2%

130 2%

130 2% Dentists

Inc ludes: • dentist technicians

150 2%

Heads of sections Physical therapy Total indicative occupation gap in 2012

70 1%

70 1%

8 380 100%


Health organisations also identified the top five skills required in the sector, which are outlined in Table 3.1. The most commonly identified skill required in the health sector was communications skills (27 per cent of total responses), followed by technical skills (15 per cent).



Table 6.9 TOP 5 SKILLS — HEALTH


Communication Skills 27% Technical skills 15% Soft skills (people and team work skills) 12% English language skills 8% Nursing skills 8%


As Figure 6.7 highlights, the occupational groups that have the highest average monthly wages are managers and business executives, scientists and science technicians, engineers and engineer technicians, and business professionals. Services and sales people and other occupations, in contrast, have the lowest.

Figure 6.7

AVERAGE MONTHLY WAGE (BD) BY OCCUPATION GROUP — HEALTH


Health organisations do not have difficulty attracting employees, they are more likely to experience a shortage in supply of good candidates. Some surveyed employers commented that a shortage of good candidates affected their organisation (38.5 per cent) but there was no difficulty in attracting these good candidates to the organisation (92.3 per cent). More than half of the surveyed health organisations were not happy with current employee numbers (69.2 per cent).

Specifically, survey respondents noted that the greatest current workforce shortages in the health sector were professionals in medical sciences (59 per cent of total responses), nurses (32 per cent) and dentists (6 per cent).

In terms of training capacity, health organisations were likely to provide induction training and technical training in house with 38.5 per cent (induction training) and 53.8 per cent (technical training) of health organisations doing so. Training priorities were mostly in administration training, with 38.5 per cent of organisations listing this as a high priority Figure 6.8 displays training capacity and priorities for surveyed organisations in the health sector.



Figure 6.8 TRAINING CAPACITY AND PRIORITIES


Additional comments by organisations provided further insight into the current difficulties in filling needed health specialist positions. The Bahrainisation policy exacerbates the shortage in health care specialists and one employer noted that that it was difficult to fill the demand for high skilled and qualified health care specialists with Bahraini employees. More specifically, one respondent noted that endocrinologists, gastroenterologists, obstetricians, gynaecologists, rheumatologists and ECG technicians are positions difficult to fill both globally and in Bahrain.


Similar to the information described above, stakeholders from the health sector noted that there were two key areas where skills gaps were present — health management and human resources, and specialist and technical health skills. One stakeholder mentioned that high-level health specialities such as cardiology and oncology, and general surgery were satisfactorily resourced in Bahrain. However, sub-specialities (such as orthopaedic, plastic and neurosurgery), allied health professions and primary health care specialists in chronic disease (such as diabetes and asthma) were significant current occupational gaps, let alone sufficient for any future growth in health services demand. In relation to health management, some stakeholders noted that a lack of a long term vision for the health sector which will have a likely impact on managing the future health workforce.

Although not directly related to skills, some stakeholders also commented on the current issues that are experienced with licensing of medical professionals. These requirements are seen as onerous and will likely hinder growth of the private sector unless the licensing process is reviewed and streamlined.



Stakeholders also highlighted nursing as a significant shortage in the health sector. Although the potential for young, Bahraini women to participate in the sector was acknowledged, and the introduction of nursing courses at the RCSI in the last couple of years has contributed to closing this skills gaps, stakeholders felt there was still a large number of nurses needed to meet future health services demand. Another issues that was noted by one stakeholder was that although the health sector is well suited to Bahraini female participation, a consideration needs to be made for the impact of maternity leave on the health workforce.

Further, one stakeholder highlighted that there was limited opportunity for Bahrainis to become pharmacists, as there were only very few opportunities to acquire the skills necessary in Bahrain — as a result, a large number of pharmacists in Bahrain are expatriate workers.

Another issue highlighted by stakeholders was the use of the Bahrain health system by citizens from other GCC States. In particular, people from the east coast of Saudi Arabia come to Bahrain and utilise emergency health and cardiac care services. Given the cost to the individual for such a service is minimal (or comes at no cost), future health demand will be further impacted by increased numbers of GCC nationals utilising Bahrain’s health services.

In addition, health education institutions noted that attracting sufficiently skilled faculty has been problematic because of the length of time it takes to engage non-Bahraini staff and the attractiveness of remuneration. As a consequence current faculty often substitute where staffing gaps occur. Further, these institutions identified that English language skills were in need of development for a significant number of students — one institute has put into place a 6 months English bridging course available to all students.

Stakeholders also identified a number of other key issues relevant to the health sector and skills gaps, including:

• the future need for health professionals and services to provide for the elderly,

as the traditional family support network will likely shift to a greater reliance on public health services

• a greater emphasis on customer service skills training

• a limited career progression for employees in the health sector

• the need for mentors and programs that aid mentorship to enhance the quality

of health care and provide a clearer path for career development

• a lack of integration between training providers and the sector, an improvement in which would help to ensure a better balance between the skills needs of the sector and the training courses available

• similarly, the need for public-private collaboration was noted by stakeholders.

Such collaboration would assist for a richer learning experience in both the private and public sectors, especially in terms of continuing professional development




The skills gap in Bahrain’s health sector is apparent from the findings of the labour market analysis, surveys and other reports. Currently, health sector skills gaps fall into three main areas:

• health care specialists

• health management and coordination (including human resources and health

workforce planning)

• administration.

Results from employer survey and the current skills gaps identified in the labour market analysis can be used to determine an approximate number of specific occupations required in 2012, including the future need for:

• 400 health professionals

• 500 managers

• 1500 other health workers

These numbers reflect the growth in Bahrain’s health infrastructure, which is expected to be completed in 2009 and will require an increase in the pool of the labour market, in addition to growth in the sector to 2012.

The shortage of health care specialists, who are the backbone of the health system is a crucial issue for the health system. Health organisations have reported the shortage of specific specialists and the general difficulties in filling positions. Projections of the health sector workforce show that these shortages will persist for Bahraini national employees at least for the next three years. (specifically for employees with a bachelor degree, equal to 900 jobs).

Qualification gaps projections for 2012 confirm the issue apparent from current qualifications data. By 2012, it has been projected that there will be a shortage of several types of qualifications in the industry. There will be a shortage of Bahraini staff with Diplomas, secondary education and at the PhD level. Non-Bahrainis with Bachelor degrees, Diplomas, secondary education, high diplomas, masters and PhDs is expected to fall short of demand for these workers.

Health management and coordination shortages were cited by the WHO in 2005 and these skills will be crucial to continue to develop to maintain the current performance of the health system for Bahrain’s population. The Ministry of Health also highlighted its own weaknesses in human resources management in 2002 (Ministry of Health 2000). Health management and coordination skills are necessary in the area of human resource management, and coordinating evaluations and performance of health programs and initiatives.

The employer survey results highlighted another area where skills are short of health sector needs — in administration. Administration training was the one aspect of training where the number of organisations with the current capacity to provide this training in-house fell short of the number of organisations that highly prioritise this type of training (see Figure 6.8). This suggests that there are skills gaps in the administration sub-sector of health.



The key skills gaps identified for the health sector are summarised in Table 6.10, including the sources from where the skills gaps have been highlighted.

Table 6.10 SKILLS GAPS SUMMARY — HEALTH SECTOR

Study input Health care specialists Health management and coordination

Administration

Labour market analysis ü û û Qualifications analysis û û û Survey of employers ü û ü Survey of employees û û û Survey of graduates û û û Survey of Education Institutes û û û Key stakeholder consultations ü ü ü

Other information sources ü ü û


6.7 SWOT snapshot

On the basis of the analysis above, a snapshot of the strengths, weaknesses, opportunities and threats to the health sector in Bahrain has been completed (see Table 6.11). This summarised information will be used to inform action plans for a small number of sectors in Report 4.



Table 6.11 SWOT — HEALTH

STRENGTH WEAKNESS • High access to health services across Bahrain • Advanced and modern health infrastructure • The Bahrain Health Strategy — Framework for Action is a

positive step to identifying the Ministry’s strengths and weaknesses and establishing 12 goals to direct improvement of the health sector in the future — including human resources and education and research

• High Bahraini national participation in the workforce relative to non-Bahrainis

• Education opportunities for Bahraini nationals to study overseas and a commitment to focus on growing education.

• Shortage of health specialists in non-communicable disease

• Limited management personnel and health coordinat ion capacity

• Limited evaluation performance management of health initiatives/ programs and associated skills

• Significantly lower average private sector earnings for women compared to men and Bahrainis compared to non- Bahrainis.

OPPORTUNITY THREAT • Increase health education opportunities for Bahrain i

students through linkages with international schools • Development of the National Authority of Organising

Health Professions and Services (a regulatory body) will help foster private sector growth whilst maintaining health service quality

• The growing private sector will provide more scope to benefit the entire economy in terms of education and training opportunities and employm ent

• Education facilities that could be used to train more health service graduates (specifically nurses)

• A potential pool of young Bahraini female workers that may find the health sector an attractive working environm ent.

• Bahrainisation may pose a barrier to f illing shortages in health specialist positions with foreign doctors

• Increasing incidence of non-communicable disease placing added stress on the health system and workforce

• Population growth placing added pressure on the health system

• Wage differential may discourage women from participating in the private sector.



The efficacy of the health sector, given the skills gaps identified above, will be under pressure in the future — especially in a context of high incidences of non- communicable diseases in Bahrain coupled with a growing population. With a global shortage in health care specialists, Bahrain will need to address the skills of Bahrainis to maintain its health status as a nation.

In the short term, the Bahrainisation policy may be contributing to the current staff shortages, hindering recruitment of foreign staff where Bahrainis have limited skills for specialist positions. A number of employer survey respondents mentioned this issue. Bahrainisation may hinder Bahrain’s ability to attract foreign health care specialists and this group is the dominant demographic of the private sector that is, as already ascertained, the key not only to health provision, but also to health education and the national economy.

There is also strong encouragement to grow the private health sector because of the benefits it will bring to the whole of Bahrain, including tapping into the health tourism industry. Potential limitations to its ability to provide health care of a high standard may be the shortage of skilled staff and the potential for under regulation of growth in the private sector.



In the longer term, however, the key problem facing the health sector is the current health workforce shortages in two significant areas — health specialities, including allied health positions and nurses, and heath management, human resources and health workforce planning skills — two vital areas that need to be addressed to assure a strong future health system for Bahrain.



3

Chapter 7

Public Administration


As at January 2009, Bahrain’s public sector consists of 24 Government Ministries and 19 Government Organisations. A list of Ministries and Organisations is presented in Table 7.1 below.

A large proportion of public sector employees provide public services such as health and education. Statistics from the Civil Service Bureau (CSB) in 2008 indicates that of the 39 501 public employees recorded, 64 per cent (25 354 employees) are employed by the Ministries of Health and Education. The balance of 14 147 staff are employed in other Ministries and agencies .

The main characteristics of the sector and its employment profiles are outlined in the sections below.

3 Other Ministries and Government organisations are Bahrain Monetary Agency; Commission for Marine Resources, Environment and Wildlife; Pension Fund Commission of Ministry of Finance; GOSI; Ministry of Interior; Defence; Ministry of Municipalities and Agriculture Affairs



Table 7.1 GOVERNMENT MINISTRIES AND ORGANISATIONS ANALYSED IN THIS CHAPTER

Government Ministries Government Organisations

Prime Minister's Court Tender board

Ministry of Justice and Islamic Affairs Central Informatics Organisation

Ministry of Foreign affairs General Organisation for Youth and Sports

General Directorate of Civil Aviation Affairs Central Bank of Bahrain

Ministry of Defense Civil Services Bureau

Ministry of Interior Pension Fund C om mission

General Directorate of Nationality, Passport and Residence General Organisation for Social Insurance

General Directorate of Traffic Legal Affairs Department

Ministry of Municipalities and Agriculture Affairs Survey and Land Registration Bureau

Ministry of Electricity and Water National Oil and Gas Authority

Ministry of Shura Council and Representatives Council Affairs

Royal Charity Organisation

Consultative Council Public Commission for the Protection Marine Resources,

Environment and W ildlife

Council of Representatives Bahrain Economic Development Board

Ministry of Finance Court of Audit

General Directorate of Customs and Ports Affairs Labour Market Regulatory Authority

Ministry of Works Tamkeen (Labour Fund)

Ministry of Housing Bahrain Institute of Public Administration

Ministry of Information (includes Cultural Affairs and Tourism)

E-Government Authority

Ministry of Industry and commerce Bahrain Centre for Research and Studies

Ministry of Education

Ministry of Labour

Ministry of Health

Ministry of Social Developm ent

Ministry of Cabinet Affairs

Source: (Civil Service Bureau (CSB) 2008b).

7.2 Public administration in Bahrain

The public sector was estimated to comprise 7.6 per cent of Bahrain’s GDP in 2006 (BD452 million). This share is lower than that contributed in 2002, when the public sector comprised 10.5 per cent (BD337 million) of GDP (see Figure 7.1).

In 2007 the Bahrain public sector employed an estimated 60 779 staff, representing an absolute increase from 2002, when the public sector employed 48 273 staff. However, the share of public sector employment as a per cent of total employment had declined from 15.7 per cent in 2002, to 12.1 per cent in 2007 (see Figure 7.1).



Figure 7.1 PUBLIC ADMINISTRATION AS A PROPORTION OF GDP AND LABOUR FORCE —2002 TO 2007


Separate data collected by the Civil Service Bureau (CSB) indicates that approximately 36 per cent of public sector employees work in non-service delivery

4

focused Ministries, these public sector employees are* the main focus of this chapter. The remainder of workers (such as those public health and education service delivery professionals) are discussed separately in other chapters of this report.

There has been a gradual growth in the number of public sector employees in recent years, increasing from 34 300 employees in 2002, to 39 500 employees in 2008 (see Figure 7.2). Over this period, the proportion of Bahrainis within the public sector has declined slightly from 90.4 per cent, to 88.6 per cent.

Figure 7.2

PUBLIC SECTOR EMPLOYMENT

Note: Figure 7.2 does not include Bahrain Monetary Agency; Commission for Marine Resources, Environment and Wildlife; Pension Fund Commission; General Organisation for Social Insurance; Ministry of Interior; Ministry of Defence; Ministry of Municipalities and Agriculture Affairs

Source: (Civil Service Bureau (CSB) 2008a).

4 All Ministries except Ministry of Education and Ministry of Health.



Multiple data collections

Data reported in Figure 7.1 is based upon analysis of survey data collected from a sample of the Bahraini population, whereas Figure 7.2 is based upon administrative data collected by the CSB on public sector employees. Furthermore, Figure 7.2 does not include the Bahrain Monetary Agency; Commission for Marine Resources, Environment and Wildlife; Pension Fund Commission of Ministry of Finance; GOSI; Ministry of Interior; Defence; Ministry of Municipalities and Agriculture Affairs.

Service delivery and administration workforce

In addition to general public sector employment, the public sector labour force can also be considered in terms of employees that work in public service delivery and those that work in public administration. Employees in the public sector can be considered across ten occupation categories outlined in Box 7.1.

Box 7.1 SPECIFIC PUBLIC SECTOR OCCUPATIONS

Public service delivery occupations, including: • social, cultural and religious workers • health service delivery • educators and teachers • elementary occupations (cleaners, cooks etc) • scientists and engineers • plant and machinery operators Public administration occupations, including: • administrative support • business and administrative professionals, and other specialists • information, communication, IT and media occupations • executive and managerial occupations.


Figure 7.3 shows data provided by the CSB in 2002 and 2008 across the 10 public sector specific occupation categories. This information shows that:

• health service delivery workers increased in number from 2002 to 2008.

• the largest proportion of non-Bahraini’s work in health service delivery (6 per

cent of the total public sector labour force in 2008) followed by educators and teachers (4 per cent)

• there was a decrease in the number of elementary occupations, plant and

machinery operators, and information, communication, IT and media occupations between 2002 and 2008

• there was an increase in executive and managerial occupations of 61 per cent

between 2002 and 2008 (increasing from 5 per cent to 7 per cent of the total public sector labour force).



Figure 7.3 PUBLIC SECTOR LABOUR FORCE — 2002 AND 2008

Source: (Allen Consulting Group and Eidos); (Civil Service Bureau (CSB) 2008a).

Current composition of public sector

Skills and education

The 2004 Bahrain Labour Force Survey collected data on education levels. Results of this survey, comparing skill levels among respondents working in the ‘Government services and public administration’ sector to the total labour market, are summarised in Figure 7.4.



Figure 7.4 EDUCATIONAL LEVELS: GOVERNMENT SERVICES AND PUBLIC ADMINISTRATION

Source: (Labour Market Regulatory Authority 2004).

This analysis indicates that employees in the ‘Government services and public administration’ sector have levels of education slightly above the total labour market. For example, 33 per cent of employees in the ‘Government services and public administration’ sector have a secondary school education, compared to 30 per cent of the total labour force. The percentage of the ‘Government services and public administration’ sector workforce with less than secondary school education, diploma, Bachelor or above, is in line with the total labour force.

Main occupational groupings within the Bahraini public sector

The 2004 Labour Force Survey collected data on the occupation of all respondents. Figure 7.5 details the results of this survey, comparing employees working in ‘government services and public administration’, and all other sectors. Just under 50 per cent of employees working in ‘government services and public administration’ work in the occupation category ‘handcrafts, product, or process’. This compares to 32 per cent of the total Bahrain workforce who work in this public administration.



Figure 7.5 OCCUPATIONS: GOVERNMENT SERVICES AND PUBLIC ADMINISTRATION IN 2004


Bahrainisation of the public sector

Across the public sector 89 per cent of employees are Bahraini. However, the employment of Bahrainis by individual agencies varies greatly. For example, all of the Prime Minister’s advisors are Bahraini (17 staff), whereas within the High Council for Judiciary 60 per cent of staff are Bahraini. Within the High Council for Judiciary, non-Bahraini staff are largely employed as judges, with 46 of the 76 judges being non-Bahraini. In contrast, the Ministry of Works and Housing employs 236 non-Bahrainis out of a total of 1687 staff, with non-Bahraini staff largely employed in engineering roles.

Managing public sector training and skills formation

The CSB is the key agency responsible for managing the staffing functions of the Bahraini public sector. Established by the Amiri Decree no. 6 in 1975, the CSB plays a key role supervising personnel affairs of Ministries and Organisations and making suggestions regarding civil service affairs, laws and rules. The main functions of the CSB are: recruitment, promotion, remuneration and training.

Training is the most important function of the CSB in the management of skills in the public sector. The CSB plays a leading role in managing the basic policy of training and developing government employees. It provides intensive training to all government employees, and is determined by the allocation of an annual training entitlement granted to government ministries and organisations.

The CSB is assisted in identifying the training needs of the public sector through the bi-annual ‘Training and Development Needs Survey’ and the development of Ministry-level training plans and budgets. The survey is crucial in developing the training programs delivered to employees.

The main implication of this function is that skills gaps tend to be lower in the public sector, than in other sectors. Although some stakeholders have noted that many government ministries and organisations are not utilising their full annual training entitlements, and there is scope for increased participation in education and training to occur.



In addition, the University of Bahrain (UB) provides graduate training for public sector employees. The UB offers training in the fields of: information technology; science; engineering; business administration; law, education, arts and applied learning and teaching. In, particular, it delivers the Continuing Management Education Program (COMEP), consisting of seminars, workshops and short training courses that deal with a variety of important business-related issues. While UB’s training is considered by many stakeholders to be a relatively effective skills development mechanism, there are some concerns about its ability to respond to government priorities.

Other organisations, such as the Bahrain Institute for Public Administration and private providers, also offer training, however there is little evidence to evaluate the effectiveness of this training.

7.3 International trends in public sector skills and skills needs

Bahrain, like many other nations, is currently seeking to align historical approaches and practices to public administration (such as impartiality, high ethical standards, sound processes and adequate record keeping) with the techniques of modern public management and governance (such as responsiveness, outcomes-focused approaches and flexibility).

The challenge for Bahrain is to incorporate or reinvigorate desirable traditional civil service values, such as impartiality, integrity and dedication to public service, with notions such as innovation, continuous improvement, responsiveness and transparency. This challenge has important implications for the way in which individual public agencies acquire and maintain skills, in particular the preconditions that are necessary to meet skills gaps.

An overview of these preconditions is presented below.

Global trends in recognising skills needs and addressing skills gaps

The preconditions necessary for recognising skills needs and in addressing any perceived gaps, have been discussed by international organisations (such as the United Nations, the World Bank and the International Labour Organisation (ILO)) and other research organisations (such as Economic and Social Research Institute, UK). These organisations provide guidance as to how countries have managed the transition from traditional to modern public sector employment environments.

The main institutions and processes that assist in the identification and remedy of public sector skills gaps include:

• Independent Civil Service Bureau (ICSB). ICSBs are fundamental institutions

in recognising skills needs and addressing skills gaps. They are key to the collection of skills-related data, to the development of recruitment, promotion and performance procedures, and to the management of public sector training (United Nations 2005a).



• Leadership in public administration. Leadership based on the ability to motivate staff, build partnerships and collaborate with other government agencies is crucial in managing the complexity of public sector environments. In particular, public sector leaders must embody shared visions, values, norms and standards of organisations, and demonstrate a strong commitment and determination that inspires others (Organisation for Economic Co-operation and Development 2001; United Nations 2005b).

• Performance management regimes. Performance orientations (such as staff

appraisal and incentive regimes) have profound impacts on how employees are recruited, managed and developed. Managers are increasingly responsible for the performance of staff, through the setting of objectives that relate to the overall goals of the organisation, through monitoring their performance, and giving them support, feedback and the opportunity to develop (Australian Government 2001; World Bank 2002).

• Merit-based appointment. Appointing and promoting staff on the basis of merit

is one of the most powerful, yet simple method in which public organisations can improve their effectiveness. The presence of a merit oriented and career-based civil service fosters organisational standards, behavioural norms and esprit de corps that promote commitment and integrity among public servants (Organisation for Economic Co-operation and Development 2004; United Nations 2005b).

• Adequate remuneration. The adequacy of pay is an integral part of attracting

people with the right skills to the public sector. The challenge for the public sector is to provide sufficient salaries to attract and retain competent staff while providing the appropriate incentives to maintain performance over a sustained period. The introduction of performance-based pay is considered to be one way of balancing the financial incentives of individuals, with the strategic goals of organisations (Economic and Social Research Institute 2003; International Labour Organization 2006).

• The professionalisation of human resource management within individual

agencies. Staff responsible for human resources should not be confined to playing a restricted, bureaucratic and reactive role, but should have real input into strategic decisions about staff management as well as decisions on how to achieve the core objectives of government. As such, human resource managers should be upgraded within organisational structures and decision-making processes to assist in planning for future skills needs.

Importantly, Bahrain’s public sector reflects many elements found in ‘good practice’ systems. This is significant because the relative size (as a proportion of total employment) and structure of Bahrain’s public sector is comparable to many other advanced nations with high performing public sectors (Organisation for Economic Co-operation and Development 2002).


This section presents data and information relating to the future skills needs in public administration in Bahrain. The data is presented based on:

• economic forecasting and modelling of GOSI and LMRA data collections



• surveys of employers, employees, graduates, and education and training institutes

• face-to-face consultations with key government stakeholders and education

and training providers.


Forecasts based upon historic trends estimate that public sector employment is expected to increase from 60 000 in December 2007, to reach 70 000 by 2012.

Public sector employment is expected to decline as a share of total employment, from 14 per cent in 2007 to 10 per cent in 2012. Notably, in 2007 Bahrainis employed in the public sector comprise 37 per cent of total employment of Bahrainis across all sectors. This share is expected to decline to 35 per cent by 2012.

In contrast, the public sector employs relatively few non-Bahrainis. In 2007, the public sector employed 4 per cent of all employed non-Bahrainis. This share is expected to fall to 3 per cent by 2012.

Figure 7.6

PUBLIC SECTOR EMPLOYEES (FORECAST)


Employer and employee surveys

Employers

The employer survey comprised of 7 public administration respondents, which employ a total of 4337 employees, or 30.7 per cent of the public administration sector. Of these 4337 employees, 90.2 per cent of these are Bahraini and 87.2 per cent are male.

Table 7.2 provides a breakdown of trade respondent employee numbers by first-tier occupational groups and demographics. The largest occupational groups are other occupations, engineers and engineer technicians and managers and business executives. No employees are recorded at the health professionals, education providers, and construction occupations levels.



Bahraini males dominate all occupational groups (except those where no employees are recorded). Non-Bahraini males are predominantly employed in engineer and engineer technicians positions, while Bahraini females are primarily employed in other occupation, engineer and engineer technicians and services and sales people roles. Non-Bahraini females represent less than one percent of public administration employees.

Table 7.2 FIRST TIER OCCUPATIONAL GROUPS — PUBLIC ADMINISTRATION

Bahraini Males Bahraini Females Non-Bahraini Non-Bahraini Males Females

Managers and business executives 6% 6% 5% 7% Scientists and science technicians 0% 1% 1% 0% Engineers and engineer technicians 21% 18% 64% 20% Health professionals 0% 0% 0% 0% Educations providers 0% 0% 0% 0% Business professionals 2% 6% 3% 13% Administrative services 2% 4% 0% 13% Services and sales people 2% 10% 0% 0% Construction occupations 0% 0% 0% 0% Other occupations 67% 54% 27% 47%


Table 7.3 provides a breakdown of public administration respondent employees by second-tier occupational groups. Other occupations and electrical engineers account for three-quarters of the employees, while administration-related occupations account for a further 13 per cent. Other occupations identified by respondents include professionals in system analysis, law, and insurance, industrial managers; and civil and survey engineers.

Table 7.3 SECOND-TIER OCCUPATIONAL GROUPS — PUBLIC ADMINISTRATION

Occupational Group Proportion of total sector

responses Other 53% Electrical engineers 25% Administrative managers 8% Civil servant clerks 3% Engineering technicians 2% Supervisors of sections 1% Administrative specialists 1% Administrative clerical workers 1%




Table 6.8 shows an indicative forecast to 2012 of second-tier occupations that apply to the public administration sector. The indicative forecast is based on the following method:


to 117 occupation categories). 88 per cent of public administration employers who participated in the survey responded to the second-tier related questions

• for the pubic administration sector, the key second-tier occupation categories

were compared to relevant statistics from the United Kingdom on their public administration in 2004 as a proxy to provide a benchmark to validate the forecast (International Labour Organization 2007).


public administration sector and the outcomes of the stakeholder consultations undertaken as part of the Skills Gaps Research Study

• the key limitations for the results in the public administration sector are that

the respondents to the second-tier occupation categories were 88 per cent of the total sector responses and that the nature of the occupation in public administration would include a larger proportion of unskilled workers in Bahrain compared to the United Kingdom.




Table 7.4

SECOND-TIER OCCUPATIONS (INDICATIVE FORECAST 2012) — PUBLIC ADMINISTRATION SECTOR

Proportion of

Indicative total forecast forecast occupation

Second-tier occupation 2012 gap Other

Inc ludes: • Business professionals including professionals in

law, insurance, systems analysis, accounting and economics (around 16 per cent)

• Human resource specialists (around 6 per cent) • Trade and construction positions (around10 per cent) • Service workers (around 7 per cent) • Unskilled workers (around 14 per cent) Engineers Inc ludes: • civil and survey engineers • electrical engineers • electronics engineers • chemical engineers • industrial engineers

1550 49%

750 24%

Administrative managers Civil

servant clerks Administrative

specialists Administrative

clerical workers

Engineering technicians

250 8%

240 8%

150 5%

110 3%

60 2% Supervisors of sections

Inc ludes: • Heads of sections

40 1%

Total indicative occupation gap in 2012 3150 100%


As Figure 6.7 highlights, the occupational groups that have the highest average monthly wages are managers and business executives, health professionals, and engineers and engineer technicians. Administrative services and other occupations, in contrast, have the lowest.



Figure 7.7 AVERAGE MONTHLY WAGE (BD) BY OCCUPATION GROUP — PUBLIC ADMINISTRATION


Survey respondents noted that they currently have vacancies primarily at the business professionals, engineers and engineer technicians and managers and business executives levels (Figure 13.14). No vacancies were reported at the education providers, services and sales people and construction occupations levels.

Figure 7.8

CURRENT VACANCIES — PUBLIC ADMINISTRATION


Survey respondents also noted that, over the next five years, they are likely to create the most positions at the business professionals and engineers and engineer technician levels. Respondents did not indicate that they would create positions at the education providers, health professionals and construction occupations level (see Figure 15.9).



Figure 7.9 POSITIONS CREATED OVER THE NEXT FIVE YEARS — PUBLIC ADMINISTRATION


Respondents were asked to comment on factors that constrained public administration organisations from hiring additional staff.

• 28.6 per cent identified a lack of financial resources (compared to 26.5 per cent

for all survey responses)

• 14.3 per cent identified a shortage of good candidates (compared to 19.9 per cent overall)

• 28.6 per cent highlighted difficulty in attracting good candidates (compared to

13.6 per cent overall)

• 71.4 per cent identified that they were happy with the number of staff they currently employed (compared to 44.4 per cent overall).

These findings suggest that the skills shortage in public administration is less acute than in the Bahraini economy at large.

Among public administration sector employers responding to the survey, 14.3 per cent indicated that it was harder to recruit good quality staff than two years previously. Conversely, 42.9 per cent of respondents indicated that it was easier to recruit good quality staff than two years previously.

Respondents also noted the change in quality of recruits in the manufacturing sector by nationality compared with two years ago. No respondents indicated that the skills levels of Bahraini and non-Bahraini recruits had reduced over this period Significant proportions of respondents, however, specified that recruits exhibited higher standards of technical and/or generic skills compared with two years ago (see Figure 13.16).



Figure 7.10 CHANGE IN QUALITY OF RECRUITS IN TWO YEARS


Public administration respondents rated the importance of skills they look for when hiring employees on a scale ranging from not important to very highly important. Work communication was rated the highest, followed by management skills and customer communication (see Figure 13.17). Public administration employees rated persuasive skills, problem-solving skills and numeracy as the least important.

Figure 7.11

IMPORTANCE OF WORK-RELATED SKILLS — PUBLIC ADMINISTRATION


Public administration respondents also identified the top five skills required in the sector, which are outlined in Table 11.6. The most commonly identified skills required in the public administration sector were communications skills and training skills (each of which received 21 per cent of total responses), followed by technical skills (11 per cent).



Table 7.5 TOP 5 SKILLS — PUBLIC ADMINISTRATION


Communication skills 21% Training skills 21% Technical skills 11% Loyalty 5% Professionalism 5%


Employees

A survey of current employees across the Bahrain economy has also been 5

undertaken. Over one-quarter of respondents indicated that they had specialised in fields relevant to public administration as part of their education. In particular, 22.8 per cent of respondents reported that they had specialised in commerce/law, 3.2 per cent in humanities, and 1.1 per cent in social science.

The survey highlights that the majority of public administration employees are Bahraini, with 87.5 per cent of survey respondents working in public administration reporting that they were Bahraini.

Among respondents currently employed in public administration, 61.1 per cent possessed a Bachelor degree or higher (see Table 7.6). Furthermore, 34.7 per cent of respondents advised that they had studied outside Bahrain, and 15.3 per cent advised they that they had worked outside Bahrain.

Table 7.6 HIGHEST EDUCATIONAL QUALIFICATION COMPLETED: PUBLIC ADMINISTRATION

Qualification level Per cent of respondents

Prim ary/Secondary school 13.9 Certificate / Diplom a 22.2 Bachelor degree 48.6 Postgraduate degree 4.2 Masters degree 8.3 Other 2.8 Total 100


5 From a total of 975 respondents, 72 worked in public administration.



Among current public administration employees, the most common occupation was ‘administrative services’ (30.9 per cent) followed by ‘business professional’ (17.6 per cent) and ‘manager’ (14.7 per cent). Among those respondents not working in their first job, 30.3 per cent indicated that their previous employment was in the public administration sector, with 24.2 per cent of respondents indicating that their previous employment was in the business services sector.

Employee survey respondents also commented on the skills they see as important for their jobs (now and in the future). On average, respondents highlighted that numeracy and literacy skills were highly important, but persuasive skills were not as important.

In addition, survey respondents highlighted attitudinal characteristics that they found influential in a job (see Figure 7.12). Respondents from the public sector found that remuneration and the work environment were very highly influential (4.2 and 4.0 out of 5). Work-life balance was considered highly influential (3.98 out of 5).

Figure 7.12

ATTITUDES ABOUT WORK — PUBLIC ADMINISTRATION


The views of key government stakeholders about the future skills needs of Bahrain

Consultations with key government, educational and private sector stakeholders suggest that Bahrain actually has a sufficient pool of labour from which public agencies can draw employees. However, some stakeholders suggest that the presence of some structural and attitudinal issues inhibit agencies from accessing appropriately qualified candidates.

A summary of the main issues arising from these consultations is presented below.

The under-utilisation of skills by the public sector

The under-utilisation of young educated women in particular, is an important concern for the sector. Stakeholders suggest that the large growth in the number of young female graduates over the past decade has placed pressure on the capacity of public sector agencies to employ them.

It is suggested that perceptions of women in the workforce will need to adapt in some public sector agencies to account for the growth in female graduates.



The balance between Bahraini and non-Bahraini workers

Positions in the Government Ministries of Bahrain are staffed, where possible, with qualified Bahraini citizens. When qualified Bahraini citizens are not available, the direct-hire of non-Bahrainis is necessary.

Stakeholders have suggested that this is of particular note at Director level, where government agencies regularly seek the specialised skills of non-Bahraini workers to fulfil these roles. While stakeholders have suggested that public administration generally displays a higher level of experience and qualifications than other economic sectors, the use of contracted non-Bahraini’s at the highest levels of government is problematic. Specifically, the public sector experiences a significant ‘skills deficit’ when high-level non-Bahraini workers exit the country.

Some stakeholders have also expressed concerns that non-Bahraini workers are increasingly not given opportunities to progress beyond lower levels of public administration.

Complex classification systems limit planning and progression in the public sector

The presence of a complex system for classifying public sector jobs (in particular, multiple classification standards, multiple salary tables, and job descriptions fall outside required standards, with long lead times for job reclassification) is seen by stakeholders to impede agencies’ ability to plan for future skills needs (see also Organisation for Economic Co-operation and Development 2008b). Stakeholders have expressed concerns that the presence of over 4000 public sector job classifications has profound impacts on the ability of individual agencies to promote staff. In particular, the presence of an overly rigid system (requiring 12 months experience in order to be promoted, or entitles an individual to a promotion based on tenure) is considered too impractical to effectively manage skills development.

A qualifications framework for public sector employees is necessary

While most positions within the public sector are covered by a written description, and statements of minimum necessary qualifications (including prescribed educational levels), stakeholders report that it can be difficult to find appropriately qualified Bahraini’s to fill some positions e.g. economists. Stakeholders have suggested that the absence of a recognised qualifications framework contributes significantly to the problem of finding suitably qualified candidates. They have indicated that it will be crucial to introduce a national qualifications framework that has particular relevance to the administrative and policy activities of the government, in order to address this problem.


Primarily due to the existence and performance of the Civil Service Bureau and the high regard, which Bahrainis perceive a career in the public service, skills gaps tend to be lower in public administration compared with other sectors. Nonetheless, the labour market analysis and stakeholder comments suggest that a skills gap exists in terms of management and leadership skills. In addition, there is considerable need within the sector to accommodate an increasing number of female graduates predicted to enter the sector.



At present, there appears to be a shortage of suitably qualified Bahrainis to fill positions at the highest levels of the public sector – particularly at the Director level. Moreover, the projected expansion of the public sector’s workforce is likely to increase demand for appropriately trained human resources managers, planning officers and general management staff.



• 720 engineering/technical staff

• 171 managers (mainly at the director level).

The key skills gaps identified for the public administration sector are summarised in Table 7.7, including the sources from where the skills gaps have been highlighted.

Table 7.7 SKILLS GAPS SUMMARY — PUBLIC ADMINISTRATION

Study input Management, coordination and leadership

Labour market analysis ü Qualifications analysis û Survey of employers û Survey of employees û Survey of graduates û Survey of Education Institutes û Key stakeholder consultations ü

Other information sources ü


7.6 SWOT snapshot

On the basis of the analysis above, a snapshot of the strengths, weaknesses, opportunities and threats to the ICT sector in Bahrain has been completed (see Table 7.8). This summarised information will be used to inform action plans for a smaller number of sectors in Report 4.



Table 7.8 SWOT — PUBLIC SECTOR

STRENGTH WEAKNESS • Presence of a professional Civil Service Bureau to

centrally manage the development of skills • Presence of other basic infrastructure (such as

performance regimes, adequate remuneration, and professional HR systems) to manage skills gaps and developm ent

• Levels of educational attainment that are slightly above the total labour market

• High levels of Bahrainisation at all levels below Director- level

• Complex system of job classif ication • Lack of data about the quality and impact of public sector

training • The absence of a recognised qualifications framework

from which public sector organisations can make judgements about training needs, promotions, and recruitment

• Inadequate data about the quality and effectiveness of public sector training

• Over reliance of non-Bahrainis in high-level public sector positions.

OPPORTUNITY THREAT • Improve the level of participation in public sector training

for all current employees • Improve the way public sector training is delivered by key

training organisations • Enhance the number and quality of Batchelor Degree and

above graduates • Provide increased opportunities for highly-skilled female

graduates in the public sector.

• Banking and Finance sectors could poach staff with the promise of higher wages and conditions

• Neighbouring nations (such as Saudi Arabia) could poach well educated public sector staff

• Female university graduates with the appropriate skills and training will seek employment opportunities in other sectors.



The main problems facing public administration in Bahrain are:

• the current system for classifying and promoting staff has a high degree of complexity and detail; this limits options for flexible resource management at agency level

• the absence of a recognised qualifications framework from which public sector

organisations can make judgements about training needs, promotions, and recruitment

• an anticipated shortfall in the number of university graduates at the Batchelor

degree level and above

• inadequate data about the quality and effectiveness of public sector training

• growing number of female university graduates seeking high-level opportunities within the public sector.



Part C

Sectoral and skills gaps analysis — infrastructure



Chapter 8

Construction


There are an estimated 3 400 projects worth US$2.4 trillion currently underway in the GCC region (Business Intelligence Middle East 2008). Over half of these projects are civil engineering projects i.e. roads, airports, railways, transport (including port expansions and greater airport capacity), housing, healthcare and utilities (power generation and water).

There are several factors driving the construction boom in Bahrain and other GCC countries. Firstly, GCC countries are addressing their historical under-investment in infrastructure. The countries made a commitment in the Unified Industrial Development Strategy for the Arab States of the Gulf Corporation (Cooperation Council for the Arab States of the Gulf 2002) to expand their provision of basic facilities through industrial projects in three areas:

• the construction of specialised industrial towns and zones and the development

of an appropriate infrastructure in less-developed areas in order to attract more industrial projects

• encouragement of the private sector to participate in the construction and

expansion of industrial towns

• a continuing improvement and development of supporting sector services, e.g. highways, communication, and seaports networks; and banking, insurance, and trade services.

Secondly, meeting the current and future needs of the population, business and the tourism sector, and reducing the economic dependence on oil and gas requires significant investment in infrastructure, residential and commercial projects. Factors that are driving the construction boom in Bahrain and other GCC countries are as follows:

• the large increase in the number of expatriate workers together with rising birth

rates has contributed to the strong demand for housing

• Bahrain’s tourism sector has expanded significantly over the past decade. GCC countries are expected to undertake more than US$380 billion on tourism development projects through to 2018, particularly the construction of five-star hotels (Emirates Business 24/7 2008)

• GCC countries typically have a high liquidity environment, vast capital

accumulation made possible by record-high oil and natural-gas revenues, and large budget surpluses

• the region’s stability and business friendly environment has attracted many

multinational firms, including international property developers, which need office space. It is estimated that 16.35 million square metre of gross leasable area (Gladwell) will be added in the region from 2000 to 2010, equivalent to about 45 per cent of the total GLA in Frankfurt (Emirates Business 24/7 2008)



• foreign-owned companies that meet certain eligible criteria can apply for finance from the Bahrain Stock Exchange, Bahrain Development Bank, and various banks and institutions in Bahrain. In addition, 100 per cent foreign ownership is allowed for certain categories of business

• lower housing prices than the regional average and changes in legislation that

allow foreigners to obtain freehold titles within certain residential developments has boosted the real estate sector in Bahrain.

Over the last five years, the Bahrain Government has issued over 50 000 construction permits (Table 8.1). The bulk of permits were for ‘additions to existing buildings’ and ‘new construction’. Around 60 per cent of these permits were for developments in the Middle and Northern districts of Bahrain.

Table 8.1 CONSTRUCTION PERMITS, BAHRAIN, 2003-2007

Permit Type 2003 2004 2005 2006 2007 Addition 3 943 4 485 6 176 5 420 4 848

Demolition 429 480 692 680 724

Demolition and new construction 191 176 176 404 413

New construction 4 153 3 936 3 573 4 021 3 748

Reclamation 53 49 30 36 27

Renovation 748 777 803 724 821

Total 9 517 9 903 11 450 11 285 10 581

Source: (Central Bank of Bahrain 2007).

Examples of large projects/developments in Bahrain include:

• the GCC interconnection/regional electricity grid linking the power networks of all six GCC countries, enabling the countries to use excess capacity and reduce the need for new investments in additional power generation capacity (Gulf Times 2008). The grid should come online in 2009 at a cost of US$7 billion, and a further US$120 billion over 10 years

• new mixed-use projects (residential, commercial and leisure facilities) on

reclaimed land such as Durrat Al Bahrain, Villamar@theHarbour, Anwaj Islands, Bahrain Bay, and Reef Islands (USA Today 2008)

• Bahrain Financial Harbour is a fully integrated master planned development

aiming to create a complete financial and self-contained city in the centre of Manama at a cost of $US 1.3 billion (USA Today 2008)

• Bahrain World Trade Centre (completed in 2008) is the second tallest building

in Bahrain (240 metres) after the Harbour development, and the first building in the world to integrate wind turbines in the design (Inhabitat 2007)

• the US$150m Infinity Tower development will include 350 luxury apartments,

retail space, and five-star amenities, and will be a landmark in terms of design, quality, and luxury high-rise living (Global Investment House 2007a)



• tourism developments such as the 15 new four and five-star hotels; development of family-oriented recreational and entertainment facilities at Al Jazair Beach, the Kingdom’s main public beach; Al Farabi Care Centre in Busaiteen, a US$34 million health resort for elderly people designed to encourage medical tourism; the US$150 million Formula 1 race circuit; and the US$600 million Al Areen Desert Spa and Resort

• plans to build a further 15 new five-star hotels and 14 four-star hotels within

three years, creating nearly 5000 additional rooms — 2 165 rooms in new five-star hotels and 2 589 in new four-star hotels (Gulf Daily News 2008a)

• the first phase of the expansion of the Bahrain International Airport will raise

capacity to 15 million passengers by 2010, and increase the number of airlines operating by providing 73 aircraft hangars and bridges

• construction of the 45km Qatar–Bahrain Friendship Bridge that will extend the

King Fahd Causeway that connects Bahrain and Saudi Arabia, linking the entire region.

The construction sector relies heavily on non-Bahrainis who are employed as scientific, technical and human matters specialists or in low/lower skill positions that are included in the industrial, chemical and food industries occupational category such as labourers.

8.2 Construction in Bahrain

Figure 8.1 indicates the size of the construction sector in Bahrain. In 2007, construction contributed BD347.61 million (5 per cent) to GDP, an increase from BD134.33 million in 2002.

The construction sector is the largest sector of employment in Bahrain. Workers in the sector (115 582) made up 22.9 per cent of the total labour force in 2007, an increase of 103 per cent from 2002. Non-Bahraini male workers dominated employment and employment growth.

Figure 8.1

CONSTRUCTION AS A PROPORTION OF GDP AND LABOUR FORCE — 2002 TO2007

Source: (Central Informatics Organization 2007; Central Informatics Organization 2008; Labour Market Regulatory Authority 2008a)




Establishments/companies, subsidies from the Bahrain Government, and the Training Levy Scheme are the key funding sources for vocational training programs in Bahrain’s construction sector. Under the supervision of the Specific Council for Vocational Training in Construction, 1965 trainees in training levy paying establishments completed 114 165 training hours at a cost of around BD660 178 (or US$1.7 million) in 2006 (Ministry of Labour 2008). Key training activities were management and supervisory training, craft and technical training, and language training. Almost 90 per cent of trainees were male.

The Department of Civil Engineering Technology at the Bahrain Training Institute (2008a) offers the following Construction training programs:

• National Diploma in Building & Construction Technology

• First Diploma in Building & Construction Technology

• Craft Diploma and Craft Certificate level courses

• short company-specific courses satisfying the requirements and needs of the

employers in Bahrain.

In 2007-2008, there were only 37 enrolments in the two-year National Diploma in Construction – 21 trainees enrolled in the first year and 16 trainees enrolled in the second year.

The College of Engineering at the University of Bahrain offers Bachelor and Master of Science degrees in Civil Engineering. In 2007-2008, there were 137 enrolments in the Bachelor of Science and 20 graduates (see Table 8.2). There have been no enrolments in or graduates of the Master’s degree between 2002-2003 and 2007-2008. The Gulf University also offers the same courses in civil engineering in partnership with the American University in Cairo, American Welding Society, and American Society for Quality (Embassy of the Kingdom of Bahrain 2008b).

Table 8.2

BSC CIVIL ENGINEERING, ENROLMENTS AND GRADUATES, 2002/2003-2007/2008

Year Enrolments Graduates 2002-2003 75 9

2003-2004 75 20

2004-2005 82 17

2005-2006 109 20

2006-2007 130 18

2007-2008 137 20

Source: (University of Bahrain 2008a).

The Training Center of the Bahrain Society of Engineers offers courses in areas such as contracts for construction projects and preparation of tender documents. Targets groups include project managers, engineers, designer-builders, planners, and architects (Bahrain Society of Engineers 2008).



8.4 International trends in construction

The construction sector is a major contributor to the economy of all countries, providing significant opportunities for employment worldwide and contributing to the alleviation of poverty (ILO Construction and Infrastructure Advisory Body 2006). However, according to the Advisory Body, the sector continues to suffer from three main skills problems:

• changes in employment practices have led to a sector dominated by

subcontracting and casual employment, impacting significantly on training

• ensuring work sites have adequate occupational safety and health standards and practices in place

• effective training in the sector requires informal methods to acquire skills

supplemented by formal training when required, such as the introduction of new technologies and/or where higher output is required. Greater cooperation between workers, employers and governments to share the cost of training is required.

The single biggest issue facing the construction sector worldwide is the chronic skills shortages. As shown in Figure 8.2, adequate contractor skills and contractor capacity are the main resource contracts facing the sector (KPMG Consulting (KPMG) 2008a). The perceived effects of resource constraints are restricted sector growth, rising costs, compromised project success, and lack of appropriate training and education (KPMG Consulting (KPMG) 2008c).

Figure 8.2 MAIN RESOURCE CONSTRAINTS FACING THE CONSTRUCTION SECTOR 2008

Source: (KPMG Consulting (KPMG) 2008a).

The KPMG Global Construction Survey 2008 found that almost one-half of the survey respondents (49 per cent) were concerned that the lack of good people would restrict the growth plans of contracts and that shortages could delay major infrastructure projects. Around 150 projects in the GCC region were on hold in 2008 — 25 per cent of the projects were on hold in the UAE, 22 per cent in Saudi Arabia, 14 per cent in Qatar and Kuwait, 13 per cent in Oman, and 12 per cent in Bahrain. The delays were due to a range of factors including recruitment difficulties.



The GCC region is unable to attract sufficient numbers of skilled project and technical professionals despite the relatively high remuneration offered. Occupations in short supply in the region in late 2006 were structural specialists, quantity surveyors, planning engineers, project directors, design specialists/ managers, contractor administrators, and urban designers/planners packages (Gulf Talent 2006).

These occupations were similar to those identified by (KPMG Consulting (KPMG) 2008c) — global (and unmet) demand was the highest for site and project managers (including programming personnel), contract managers, tradespersons, engineers, and estimators (Figure 8.3). Typical specialists and professional positions in Bahrain’s construction industry advertised on international recruitment sites were similar: site managers, project managers, project directors, civil engineers, surveyors, architects, cost planning managers, and business development managers.

Figure 8.3 SHORTAGES OF OCCUPATIONS IN THE CONSTRUCTION INDUSTRY 2008

Source: (KPMG Consulting (KPMG) 2008a).

Many countries, including Bahrain, have had little choice but to fill positions with foreign labour, which has created a global and highly competitive marketplace for this labour. This form of demand-driven migration in the construction sector (as a labour-intensive sector) involves foreign-born workers being ‘pulled’ to fill the gaps for low-skilled labour that native workers reject (Fellini 2007); which is also the case for highly skilled workers where there is a lack of local talent to fill positions. As well as addressing labour shortages, low-skilled foreign-born workers help firms to minimise labour costs, and these workers are often less likely to bargain for better conditions.

India is traditionally a key source of experienced professionals in GCC countries. However, India’s own construction boom means it can offer its nationals more employment opportunities and attractive salary packages (Gulf Talent 2006). Some companies interviewed by Gulf Talent reported losing their Western expatriates to China’s booming construction sector (p. 3). Some companies were recruiting from new markets in Asia and the Arab world, particularly Egypt; and/or were employing younger professionals and fresh graduates for positions that more experienced staff would have filled. Other issues raised were the significant variation in skills sets of workers who acquired the same qualification from different countries, and skilled workers leaving companies that required them to



work six days a week. Bahrain has recently experienced industrial pressure from workers seeking higher wages and improved living conditions (Deccan Herald 2008; Zawya 2008).

Bahrain’s construction sector is starting to show signs of a slowdown in response to the global economic downturn and tightening of credit availability. In the last quarter of 2008, developers of residential construction projects experienced falling property prices and sales at a time when a number of new residential developments were launched (TradeArabia 2009). Because the construction sector in the GCC region is not expected to recover for at least two years, the number of employment opportunities are starting to fall and salary increases in 2009 (10.3 per cent) are predicted to be less than increases in 2008 (15.1 per cent) (8Local.com 2008). GCC countries are likely to use their savings to maintain capital spending on infrastructure and vital services (AME info 2009).

8.5 Future labour and skills needs

This section discusses the future labour and skills needs of Bahrain’s construction sector with reference to labour market analysis, key results from the employee and employer surveys, and key stakeholder consultation.


In Bahrain, general employment trends in the construction sector show an increase in employment between 2002 and 2007 — to a total labour force of 115 582 as at December 2007. As Figure 8.4 shows, non-Bahraini male employment dominated employment in the sector and experienced the largest employment growth rate.

Figure 8.4 EMPLOYMENT BY NATIONALITY, CONSTRUCTION — 2002 TO 2007

Source: (General Organization for Social Insurance (GOSI) 2008).

Projections for future employment in the construction sector show that the number of jobs in 2012 will have increased to 171 112 – a 48 per cent increase when compared to the number of jobs in 2007 of 115 582. The sector is expected to generate the most new jobs of any sector in Bahrain (55 530), followed by manufacturing (35 082) and trade (32 093). Employment of non-Bahrainis in the sector is projected to grow by 55.3 per cent, and employment of Bahraini nationals is projected to fall by 10.9 per cent (see Figure 8.5).



Figure 8.5 EMPLOYMENT PROJECTIONS, CONSTRUCTION 2008 TO 2012

Source: (Allen Consulting Group and Eidos); (Labour Market Regulatory Authority 2008a).

Forecast qualifications in the construction sector between 2008 and 2012 are expected to be for employees who have completed secondary school (23.8 per cent of the gap, equal to 13 226 jobs). However, demand for unqualified non-Bahraini workers will remain strong — 30.1 per cent of the gap or 16 767 jobs require workers who can read and write only.


Employee survey

Of 194 employee survey participants, 52.5 per cent were construction workers, 16.4 per cent were engineers and engineering technicians, and 11.5 per cent were administrative services workers (Figure 8.6).

About 86 per cent of participants were male, 62 per cent were under 34 years of age, 82 per cent had been born in another country, and almost two-thirds were married.

Almost one-third of participants reported earning monthly salaries of BD50-99 per month. Only 20.6 per cent of participants from the sector reported monthly earnings of BD500 or over compared to 36 per cent for all survey participants.

Figure 8.6

OCCUPATIONS OF EMPLOYEES — CONSTRUCTION




Over 40 per cent of participants reported primary, or secondary school qualifications and one-quarter reported bachelor degree qualifications (see Figure 8.7).

Figure 8.7

QUALIFICATIONS — CONSTRUCTION


Employee survey participants commented on the skills that they see as important for their jobs (now and in the future). Participants indicated that the top five (5) skills sets (out of 12 skills sets) that were important to their work were technical ‘know-how’, work communication, problem solving skills, checking skills, and numeracy (Figure 8.8).

Figure 8.8 TOP FIVE SKILLS SETS IMPORTANT TO WORK — CONSTRUCTION

Note: Some stakeholder (on seeing these survey results) commented that numeracy skills should be the most vital skill, followed by problem solving skills. Source: (Allen Consulting Group and Eidos).

In addition, survey participants highlighted attitudinal characteristics that they found influential in a job (see Figure 8.9). Participants from the construction sector identified remuneration, work-life balance and work environment as more important than work culture and employment benefits.



Figure 8.9 ATTITUDES ABOUT WORK — CONSTRUCTION


Employer survey

The employer survey comprised of 133 construction respondents, which employ a total of 24 751 employees, or 21.4 per cent of the construction sector. Of these 24 751 employees, 87.9 per cent are non-Bahrainis and 94.9 per cent are male.

Table 8.3 provides a breakdown of construction respondent employee numbers by first-tier occupational groups and demographics. The occupational groups with the most employees are construction occupations, other occupations, and engineers and engineer technicians. Education providers and health professionals, in contrast, account for the smallest number of employees.

Non-Bahraini males dominate the construction occupations (96.4 per cent), engineers and engineer technicians (82.5 per cent) and other occupations (80.4 per cent) categories. Bahraini males, in contrast, dominate the managers and business executives (58.6 per cent) category. Bahraini females are predominantly employed in construction occupation and administrative services positions. Non- Bahraini females represent less than 1 per cent of construction employees.

Table 8.3 HIGH-LEVEL OCCUPATIONS — CONSTRUCTION SECTOR

Bahraini Males Bahraini Females Non-Bahraini Males Non-Bahraini Females

Managers and business executives 18% 3% 1% 3% Scientists and science technicians 0% 0% 0% 3% Engineers and engineer technicians 11% 3% 7% 18% Health professionals 1% 1% 0% 5% Business professionals 3% 4% 0% 1% Administrative services 20% 36% 2% 50% Services and sales people 9% 2% 1% 5% Construction occupations 7% 43% 72% 0% Other occupations 30% 9% 16% 15% Total 100% 100% 100% 100%




Table 8.4 provides a breakdown of construction respondent employees by second-tier occupational groups. Building construction occupations, equipment and instruments assembly, and administrative clerical workers account for more than half the employees. Various engineer and engineering technician positions account for a further 13 per cent. Other occupations identified by respondents include: carpenters and decorators, chemical engineers and engineering technicians, insurance and accounting professionals, mechanical equipment and instrument workers, and salesmen.

Table 8.4

SECOND-TIER OCCUPATIONS — CONSTRUCTION SECTOR

Occupational Group Proportion of total sector responses

Building construction occupations 29%

Equipment & instruments assembly 16%


Other 8%


Engineering technicians 3%


Civil engineering & survey technicians 3%

Civil & survey engineers 2%

Stationary engine operators 2%

Protective workers, guards, & messengers 2%

Private sector section heads 2%

Electrical technicians 2%

Architect engineers 1%




to 117 occupation categories). 85 per cent of construction employers who participated in the survey responded to the second-tier related questions

• for the construction sector, the key second-tier occupation categories were

compared to relevant ILO data for UK in 2007 and the Bureau of Labor Statistics data for the United States in 2006 as a proxy to provide a benchmark to validate the forecast. A benchmark was unavailable from Bahrain or any other GCC State (Bureau of Labor Statistics 2006; International Labour Organization 2007).


construction sector and the outcomes of the stakeholder consultations undertaken as part of the Skills Gaps Research Study



• the key limitations for the results in the construction sector are that the respondents to the second-tier occupation categories were 85 per cent of the total sector responses.


Table 8.5

SECOND-TIER OCCUPATIONS (INDICATIVE FORECAST 2012) — CONSTRUCTION SECTOR

Indicative forecast Proportion of total Second-tier occupation 2012 forecast

occupation gap Building construction occupations 22 000 56

Equipment & instruments assembly 3 300 8

Administrative clerical workers 4 300 11

Other Includes: • professionals in accounting • protective workers, guards & messengers • consumer goods salesmen

2 700 7

Private sector managers


Administrative managers

Civil engineering & survey technicians Civil and survey engineers

Stationary engine operators

Private sector section heads

Electrical technicians

Architect engineers

Total indicative occupation gap in 2012

1 600 4

800 2

1 300 3

800 2

800 2

400 1

800 2

400 1

400 1

39 600 100%


As Figure 6.7 highlights, the occupational groups that have the highest average monthly wages are managers and engineers and engineer technicians. Construction occupations and other occupations, in contrast, have the lowest.



Figure 8.10 AVERAGE MONTHLY WAGE (BD) BY OCCUPATION GROUP — CONSTRUCTION


Survey respondents noted that they currently have vacancies primarily at the construction occupations, engineers and engineer technicians, and administrative services levels (Figure 8.11). No vacancies were reported at the education providers and scientists and science technician levels. Vacancies at the health professionals and services and sales people levels were less than 1 per cent of the total for the sector.

Figure 8.11

CURRENT VACANCIES — CONSTRUCTION


Survey respondents also noted that, over the next five years, they are likely to create the most positions at the construction occupations, engineers and engineer technicians, and administrative services levels (Figure 8.12). Respondents did not indicate that they would create positions at the education providers level.



Figure 8.12 POSITIONS CREATED OVER THE NEXT FIVE YEARS — CONSTRUCTION


Respondents also noted the change in quality of recruits in the construction sector by nationality compared with two years ago. Approximately 2 per cent of respondents indicated that the skill levels of Bahraini and non-Bahraini recruits had reduced over this period. Significant proportions of respondents, however, specified that recruits exhibited higher standards of technical and/or generic skills compared with two years ago (see Figure 8.2). The quality of non-Bahraini recruits is generally seen to have improved to a greater extent than Bahraini recruits.

Figure 8.13 CHANGE IN QUALITY OF RECRUITS IN TWO YEARS


On average, construction respondents identified remuneration factors (high personal income, income sufficient to reward effort, income is predictable, and income increases with experience) and work relationship factors (treated with respect, friends at work, good relationship with supervisor/manager) as being amongst the most influential in affecting an employee’s decision to take a job. Factors that were seen as being less influential include: same nationality as employee, same gender as employee and aligns with traditional beliefs.

Construction respondents also rated the importance of skills they look for when hiring employees on a scale ranging from not important to very highly important. Technical know-how and physical skills were rated the highest, followed by literacy skills and work communication (see Figure 8.14. Construction employers rated persuasive skills, problem-solving skills and planning skills as the least important.



Figure 8.14 IMPORTANCE OF WORK-RELATED SKILLS — CONSTRUCTION


Construction organisations also identified the top five skills required in the sector, which are outlined in Table 8.6. The most commonly identified skill required in the construction sector was technical skills (24 per cent of total responses), followed by communication skills (14 per cent).

Table 8.6

TOP 5 SKILLS — CONSTRUCTION

Skill type Proportion of total responses Technical skills 24% Communication skills 14% Physical skills 8% English language skills 6% Management skills 5%


Employer participants mainly recruited employees through private sector agencies, work contacts or networks, and direct approaches by potential employees. Employees reported that the main methods they used to find work were friends and relatives, newspapers advertisements, and work contacts or networks.

Employer participants also reported lower levels of ‘in-house’ induction, administration, and technical training than that recorded by employers in all sectors combined. They were more likely to conduct training in-house than to use external providers. They expected to maintain their current level of training in the next 12 months i.e. providing training ‘sometimes’. Many reported that training in technical skills and soft skills (including language) was important.



A number of employer participants raised concerns about the training levy on expatriates and visa regulations. Because locals do not want to work in the sector, they rely on non-Bahrainis to work in the sector. Levies were making it difficult for some employers to sustain their business, and some expected any increases in the levy together with strict visa regulations would cause delays in projects and a slowdown in the sector.


Stakeholder consultations involved face-to-face meetings and workshop sessions at the regional conference held in November 2008. Key themes raised are similar to those already discussed. Bahrainis are discouraged to work in the sector because of low wages/conditions; many students who complete construction courses are straight from school; and there is very little training available for existing unqualified workers. For example, some stakeholders mentioned that training is mostly conducted in Dubai and that the financial crisis would likely see a decrease in the use of regional training programs. In addition, there is no regulatory body to certify occupations or regulations to enforce the payment of basic salaries.

Stakeholders identified a number of measures to address some of these issues:

• apprentice programs to meet future skill demands of the sector, which would

reduce the pressure on schools and universities to train workers by partly shifting the training of workers to industry

• greater matching of skills to what the market requires, including improvements

to education and training to achieve this goal

• changing the perceptions about working in trade occupations, particularly the attitudes of young people

• technical training for specific occupations rather than strategies across sectors

• developing courses in inspection and safety to avoid worksite accidents

• develop certificate programs for higher paying niche occupations

• establish a regulatory body.

Some stakeholders also identified occupations that are in demand and have limited Bahraini participation, including draftsmen, project and site managers, and value engineering (the management and development to improve the value of goods or services by using examination of the service function).

Key findings for Bahrain

Bahrain’s construction sector is the largest sector of employment in Bahrain. Massive investment in residential, commercial and infrastructure projects resulted in a workforce that doubled its size within five years. Despite the current global economic downturn, strong demand for labour is likely to continue over the next five years. Non-Bahrainis will fill the majority of these new jobs.



The surveys confirmed that average earnings of workers in the sector are lower than average earnings of all workers combined. Yet employers and employees agree that remuneration was the most important factor influencing job choices. Employer responses about the key skills that they require in workers reflected their need for workers with lower levels of knowledge and skills i.e. physical skills, literacy skills and numeracy skills.

Education and training data show that training investment in the sector is low — trainees in training levy paying establishments received an average of 58 hours of training in 2006; the number of students enrolled in, and graduates of Diploma and Bachelor courses remains low; and many employers “sometimes” provide training.

Stakeholder interviews confirmed that Bahrainis were very reluctant to work in the sector. For those that do enter the sector, industry criticises the education and training system for not providing them with the necessary knowledge and skills. Stakeholders called for apprenticeship programs and greater access to technical training.


The Bahrain construction sector is not experiencing labour shortages alone, rather it is within the context of an international trend. In Bahrain, skills gaps lie in three key areas as discerned from the findings of the labour market analysis, surveys and other reports. These are in:

• induction, administration and technical skills for low-level workers

• tertiary and leaderships skills for high-level Bahraini employees

• human resources skills to assist entrants to jobs within the sector.

Results from the employer survey and current skills gaps identified in the labour market analysis can be used to determine an appropriate number of specific occupations required in 2012, including the future need for:

• 34 000 construction workers

• 3 000 engineers/engineering technicians


• 1 250 managers.

Stakeholders noted that there was very little training provision for unqualified workers in the construction sector. As such, this forms part of the reason for deterring Bahraini nationals from jobs within the construction sector. Employees within construction that have completed school have no opportunity for further training, whether external or on-the-job training. Stakeholders cited that apprenticeships and technical training for specific jobs rather than across the entire sector were options to address this shortage in training for existing workers. Measures such as these are potentially important incentives for workers given that demand for unqualified workers is and will remain strong.

Skills shortages for Bahraini workers also exist in highly qualified positions within the construction industry. Non-Bahraini workers dominate Bahraini employees across several occupation groups within the construction sector including:



• scientific, technical and human matters specialists

• sales occupations

• industrial and chemical industries.

Adding to this disparity is the fact that there have been very low or no Bahraini (and non-Bahraini) enrolments in post-graduate degrees related to the industry. As stated in Section 8.3 there were only 37 students in total in the National Diploma in Construction qualification and from 2002-03 to 2007-08 there were no enrolments in, nor graduates of the Master of Science degree in Civil Engineering (College of Engineering, University of Bahrain), a course of direct relevance to the construction sector. Examining the undergraduate scene, the proportion of students graduating from the Bachelor of Science in Civil Engineering is low compared to enrolments.

The current demographic of the sector is such that males are the vast majority of employees. Although traditionally a male dominated sector, it is nevertheless worthwhile to note that the potential of women and their skills in Bahrain’s construction sector is very much untapped.

Evidence from the employer survey indicates that the construction sector has difficulties attracting good candidates to a variety of jobs, much more so than in other sectors. Many jobs advertisements for site managers, project managers, project directors, civil engineers, surveyors, architects, cost planning manager and business development managers are advertised on international recruitment sites because there is a shortage of candidates within Bahrain. This reveals the lack of human resources and training dedicated to increasing the incentives for Bahraini nationals to take a career in the construction sector.

Table 8.7 SKILLS GAP SUMMARY - CONSTRUCTION SECTOR

Study input Induction, administration and technical skills

Tertiary and leaderships skills for high-level Bahraini employees

Human resources skills to assist entrants to jobs

within the sector Labour market û û û analysis

Qualifications û û û analysis

Survey of employers ü û ü

Survey of û û û em ployees

Survey of graduates û û û

Survey of Education û û û Institutes

Key stakeholder ü ü û consultations

Other information û ü û sources




8.7 SWOT snapshot

On the basis of the analysis above, a snapshot of the strengths, weaknesses, opportunities and threats to the construction sector in Bahrain has been completed (see Table 8.8). This summarised information will be used to inform action plans for a small number of sectors in Report 4.

Table 8.8

SWOT — CONSTRUCTION

STRENGTH WEAKNESS • Careers in construction generally have a low threshold

for entry in terms of required skills • Given construction’s importance as a source of

employment because of the size of the sector, the sector should be able to command sufficient attention from authorities for desired reforms

• Strong base of medium sized companies for scale and mass effects

• Bahrainis are very reluctant to work in the sector • High proportion of workers in lower end of wage spectrum • Skills shortage - attracting and retaining labour • Reliance on non-Bahrainis for both unskilled and highly skilled

positions • Education and training investment in the sector is low • Education and training system does not produce industry-

ready graduates/ workers • No apprenticeship system • No regulatory body governing skills and labour standards for

the sector OPPORTUNITY THREAT

• Engaging Bahrainis to work in a sector where strong demand for labour is expected to continue

• Increasing the number of Bahrainis in highly skilled positions

• Strategies to improve the perception of a career in the sector

• Education and training programmes and models of employm ent-based training that align with industry needs

• Qualifications that include units on project management, business skills, customer service, and new technology

• Technical training for specif ic occupations and certificate programs for higher paying niche occupations

• Ongoing skills shortages, leading to delays in projects or the shelving of projects

• Increased competition for labour from other GCC countries and other countries (particularly those offering better wages and conditions), making it difficult to attract another 55,530 workers by 2012

• Impact of training levies and strict visa regulations on business sustainability may see developers go elsewhere

• Economic downturn has a greater impact on the sector than expected e.g., high office vacancy rates, significant fall in property prices and sales: which will lead to a downturn in demand for labour



Bahrain’s construction sector is experiencing many of the workforce challenges that are common to construction sectors in other countries. Many of these global challenges have led to skills shortages in Bahrain as well as to an education and training system that does not provide a sufficient number of industry-ready graduates/workers. These challenges include:

• an inadequate number of people entering training

• the high attrition rate of apprentices (in Bahrain’s case, there is no

apprenticeship model/program in place)



• a high separation from the skilled trade workforce once people are qualified, caused by low demand for skills, declining industry employment prospects, and/or better careers and conditions being offered in other industries/sectors

• difficulties in recruiting new entrants with the right level of prior education,

skills and attributes

• lack of training in particular segments of the sector because of structural issues factors such as out-sourcing or sub-contracting

• an insufficient level of activity by the existing trade workforce in upgrading

skills once initial qualifications have been attained

• a failure in the provision of training to ensure that the quality and relevance of training to ensure that the quality and relevance of training provision is keeping up with rapidly changing skills needs in the workforce (National Centre for Vocational Education Research 2001).

Other challenges relevant to Bahrain include:

• changing the perception that the work is ‘dirty, difficult and dangerous’

(International Labour Organization 2001)

• producing more specialists across project management, engineering, estimating, surveying, and contract management (KPMG Consulting (KPMG) 2008a)

• addressing the issue that many employers only send employees to training

courses when it does not disrupt their work and where it is vital to their firm (Libert 2004).

Despite non-Bahrainis continuing to fill the majority of unskilled and highly skilled positions, shortages in labour and delays in projects are likely to persist. Increased global competition for labour, low wages in the sector, and the impact of training levies on business sustainability may see workers and developers go elsewhere.



Chapter 9

Information Technology


Definition

The Information Technology (IT) sector encompasses the design, development, implementation and operation of any IT device or application. Common forms of IT are computer and network hardware and software (Van der Mei 2007).

This chapter focuses upon the advanced skill needs of the IT sector and therefore does not specifically consider the use of advanced IT skills in other sectors such as banking and finance. The chapter also does not consider the basic IT skills required in the modern economy. However, consultations have suggested that many Bahraini employers are concerned over the level of IT literacy among their employees.

Within the structure of the IT sector the following sub-sectors may be isolated:

• manufacturing — consumer electronics and other electronic components

including computers and peripheral equipment, and instrumentation

• services — software and related services including design and implementation; data processing; computer, peripheral and software wholesaling

• emerging classifications — information and cultural industries, professional,

scientific and technical services (Ertl 2001).

There has been convergence between IT and Communications Technology (CT) in recent years, driven largely by the growth of the Internet. This convergence has made it difficult to separate IT from CT. For this reason, there is an unavoidable element of overlap between this chapter on IT, and the companion chapter on telecommunications.

Functions in information technology

To avoid some of the confusion associated with the industrial blurring between IT and CT, (Shahid and Shoulian 2007) developed what they call a “layered approach”. This approach, shown in Table 9.1, lists functional areas and specific activities associated with IT and CT.

Worldwide, the IT industry is passing through a re-integration stage characterised by horizontal and vertical mergers. In the future, major players will need to manage all three kinds of activities/businesses: customer relations business; product innovation; commercialisation business and infrastructure management business.



Table 9.1 LAYER APPROACH TO DEFINING IT

Layer Activity Example companies VI Customers/Consuming

V Applications Layer, contents, packaging, (e.g. web Bloomberg, Reuters,

design, on-line, information services, broadcasting AOL/Time, MSN, services, e-commerce) Newscorp

IV Navigation and Middleware Layer (e.g. browsers, Yahoo, Netscape,

portals, search engines, directory assistance, Vizzavi, Google, Genie security, electronic paym ent)

III Connectivity Layer (e.g. internet access, web IAPS and ISPs e.g.

hosting) Freeserve TCP/ IP INTERFACE II Network Layer (e.g. optical fibre network, mobile AT&T, BT, NTT, MC I-

network, DSL, local network, radio access network, WorldCom, Qwest. Ethernet, frame relay, ISDN, ATM etc) Colt, Energis,

Vodafone, etc

I Equipment & Software Layer (e.g. switches, Nortel, Lucent, C isco, transmissions equipment, base stations, routers, Ericsson, Nokia servers, CPE, billing software etc )

Source: (Shahid and Shoulian 2007).

Current issues and drivers in the IT industry

Many of the issues and drivers confronting the IT sector are a result of developments in other sectors, particularly telecommunications, including:

• multi-media subsystems (IMS) based upon IP technology which makes it

possible for operators to offer cheaper and advanced services

• data transport, with developments including Dense Wave Division Multiplexing (DWDM), and technology accompanied by Synchronous Digital Hierarchy (SDH) Systems

• cloud computing, allowing access to internet-based services without

knowledge of, expertise with, or control over the service infrastructure.

Other factors having an impact on the IT sector include the ongoing development of broadband technologies, and competition between broadband technologies. Western countries are tending to favour DSL, due to established copper infrastructures, while many Asian countries are opting for Fibre and Wireless Wi-Max. Wireless is continuing to see impressive technological innovations and growth from its initial application as a substitute for fixed line voice, to now producing fixed–mobile convergence (FMC), Wi-FI (Wireless Fidelity, WLAN technology and Wi-Max (fixed and mobile broadband technology).



9.2 Information and communications technology in Bahrain

Limited data is available on the contribution made by the IT sector to the Bahrain economy. The IT sector is estimated to have contributed 3.1 per cent of Bahrain GDP in 2006 (BD183 million). This share is lower than that contributed in 2002, when IT contributed 3.9 per cent (BD124 million) of GDP (see Figure 9.1) In 2007 the IT sector employed an estimated 3 300 staff, comprising 0.7 per cent of total Bahrain employment. This is a small increase from 2002, when the IT sector employed an estimated 1 145 staff (0.4 per cent of total employment).

Figure 9.1 GROSS DOMESTIC PRODUCT AND EMPLOYMENT: INFORMATION TECHNOLOGY


Advances in IT utilisation and development are at the heart of national wealth creation (EU ICT Taskforce 2006).

A comprehensive survey of IT employment in Bahrain was undertaken in 2002. This survey estimated there were 5 100 dedicated IT jobs, of which 1 100 (22 per cent) were within the IT sector, with the balance in other sectors, particularly financial services. This survey also estimated that within the IT sector, 36 per cent of IT jobs were held by Bahrainis, with 49 per cent of IT jobs held by Bahrainis across the whole Bahrain economy (KPMG Consulting (KPMG) 2002).

IT skill needs

The above-mentioned 2002 survey identified a wide range of IT-specific occupations in Bahrain. These ranged from hardware technicians, system analysts, to IT trainers and project managers. IT-specific occupations were present both in the IT sector and other sectors (KPMG Consulting (KPMG) 2002).

More recently, a survey commissioned in 2007 by Tamkeen (the Labour Fund) details the range of IT systems and skills needs across Bahrain. This survey identified the range of server operator systems used, and characteristics of system administrators. Survey participants comprised three IT training service providers, and 40 IT heads at medium and large companies from across the finance, manufacturing, services and government sectors (Ipsos Marketing Research 2007).

The survey found that 89 per cent of respondents used MS Server 2003 as their server operating system. The next most common operating systems were IBM/AIX and Red Hat/Linux, used by 27 per cent of respondents (see Figure 9.2). Some organisations also use more than one operating system.



Figure 9.2 SERVER OPERATING SYSTEM USED, SURVEY RESULTS

Note: Survey covered three IT training service providers, and 40 IT heads at medium and large companies from across the finance, manufacturing, services and government sectors. Source: (Ipsos Marketing Research 2007).

Finally, the survey asked respondents which operating system is likely to be the

preferred system in the future. Among most sectors the preferred system was MS Server 2003 (preferred by 60 per cent of all respondents) (see Figure 9.3).

Figure 9.3

PREFERRED OPERATING SYSTEM FOR THE FUTURE

Source: (Ipsos Marketing Research 2007).

Skills formation in the sector

University-based training

The University of Bahrain provides a range of IT courses, which are understood to be largely theoretical and involve little industry interaction. Stakeholders have suggested that graduates are not ‘job’ ready, with this a concern often raised by employers across the world. The counter to this is the argument that universities exist to equip students to think and absorb new knowledge rather than be wedded to existing technology. In Bahrain the scarcity of IT training facilities suggests that part of the university IT curriculum should be closely aligned with industry needs.



Industry-based training

A number of Bahrain IT service companies provide training to staff. For example, Kanoo IT entered into a Memorandum of Understanding (MOU) with the University of Bahrain, Microsoft and the Internet Society of Bahrain to train five talented students on Microsoft technology (Consultation). A survey of companies found that half of those surveyed offered in-house training programs, largely on the MS Server operating system (Ipsos Marketing Research 2007).

Consultations highlighted that a potential barrier to industry-based training is that once trained, staff are typically attracted into the banking and finance sector.

9.3 IT trends in Bahrain and the GCC

International comparisons: Network Readiness Index

The Global Information Technology Report has recently evaluated the capacity of Bahrain and the other GCC countries in terms of their capacity to expand their IT and telecommunications markets (INSEAD 2008). The central summary statistic is the network readiness index (NRI) in which Bahrain ranks 45th among 127 selected nations. Within the GCC the UAE (29th) and Qatar (32nd) are the highest ranked. Bahrain, ranks ahead of Saudi Arabia (48th), Kuwait (52nd) and Oman (53rd).

The variety of data covered in the NRI is shown in Figure 9.4. The NRI is a summary indicator, containing data based on 3 broad areas:

• environment — market structure, political & regulatory and infrastructure

environment. There are 20 individual indicators measuring the three dimensions of environment

• readiness — individual, business and government readiness to use ICTs. There

are 18 individual indicators measuring the three dimensions of readiness

• usage — composed of individual, business and government usage of ICTs. There are nine individual indicators measuring the three dimensions of usage.

Figure 9.4

NETWORK READINESS INDEX FRAMEWORK

Source: (INSEAD 2008).



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The criteria shown in Figure 9.4 are broad and many are equally relevant to most industries rather than specific to IT and telecommunications. Those factors most heavily connected to success in IT are isolated in Table 9.2 and Table 9.3.

In Table 9.2 the country rankings are in comparison with a total sample of 127 countries. Bahrain achieves its highest ranking in mobile phone subscriptions at 8th, well above the other GCC countries except the UAE at 10th and Qatar at 16th.

In terms of IT specific indicators — namely personal computer take-up, Bahrain is 42nd, ranking fourth among the six GCCs. Bahrain also does well, in a relative sense, in its E-participation index (34th), second behind Saudi Arabia (36th). The high rankings in human development are derived for Bahrain from its provision of almost universal primary and secondary education and from relatively high (by GCC standards) participation in tertiary education.

Tempering these impressive results is a poor performance in its “Quality of the Education System” (64th) and “Quality of Mathematics and Science index” (77th). For example, the latter ranking is noticeably below Qatar (24th) and UAE (47th). IT professions, such as programming and computer engineering, are dependent upon a strong grounding in mathematics.

Table 9.2

SELECTED NETWORK READINESS INDEX INDICATORS FOR GCC COUNTRIES (RANKING AMONG 127 NATIONS)

Indicator

Network Readiness Index 45 29 52 53 32 48 Usage component 39 27 60 59 34 53 Firm-level technical absorption 40 17 32 95 33 47 Mobile Phone Subscribers 8 10 40 60 16 50 Internet Users 53 33 43 75 37 58 Personal Computers 42 34 36 77 40 54 E-participation index 34 39 91 58 65 36 Environment component 50 43 36 56 43 45 Laws relating to ICT 38 33 87 40 37 57 Readiness component 47 25 60 41 28 49 High Speed Broadband subscriptions 43 28 47 76 22 n/a Quality of Education System 64 38 77 48 24 76 Quality of Mathematics and Science education

77 47 73 63 24 64

Internet access in schools 40 30 45 51 35 59




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The World Economic Forum has also suggested that Bahrain needs to “improve the preparation of graduates to work in the private sector”, if the country is to successfully develop technologically based industries (World Economic Forum 2007).

One potential barrier to Bahrain improving is its poor position in terms of “firm-level technical absorption”. This aspect of the NRI measures the degree to which private enterprise engages in technology transfer and licensing arrangements with other countries. Bahrain ranked 40th, the lowest in the GCC. This result is partially explained by the openness of laws relating to IT and technology transfer in Bahrain; 38th from 127 nations and below the UAE and Qatar. It is widely accepted that sound patent and copyright protection laws are vital to the importation of ICT and the growth of multinational cooperation in the ICT sector.

Bahrain is situated in a region where two countries, UAE and Qatar, have stolen a march on their neighbours. Within the GCC, Qatar has promoted an IT revolution through the ictQatar, a Supreme Council set up by Emir Sheikh Hamad Bin Khalifa Al-Thani in 2004 ‘to accelerate the transformation of Qatar into an information- based society’ (Summit Communications 2008). The Qatar ICT industry is predicted to grow by 145 per cent over the period 2007-2010 and the UAE by 16 per cent per annum over the period 2006-2111 (Business Wire 2007).

Part of the reason for the success of these two nations has been the provision of supporting infrastructure and active Government policy. Table 9.3 provides a summary of available data in these two vital areas and ranks Bahrain, relative to the other GCC members. Table 9.3 indicates that while the Bahraini government recognises the importance of IT for future development (a relatively high ranking of 27th) and is successfully promoting the use of ICT (25th) the country as a whole suffers in comparison to the UAE and Qatar in terms of Government readiness.

Table 9.3

GOVERNMENT POLICY AND INFRASTRUCTURE PROVISION IN RELATION TO ICT (RANKING AMONG 127 NATIONS)

Indicator

Government Readiness Index 21 31 80 46 24 40 Importance of ICT for government vision of the future

4 27 99 24 8 35

Prioritisation of ICT 7 33 97 66 10 50 E-Government readiness index 32 42 55 75 52 66 Government success in ICT promotion 6 25 86 56 11 35 ICT use and government efficiency 11 49 98 52 15 70




9.4 International trends in IT

A number of key international trends in the IT industry may be observed (Van der Mei 2007). In brief these relate to:

• an accelerating pace of change — unbundling of the telecommunications

sector is impacting upon the IT sector. This includes separating functional roles into access network providers, core network providers, service providers, portal providers and content providers

• continuing spread of distributed connectivity — through the integration of

information processing into everyday activities. Connectivity is being enhanced by the spread of transmission using internet protocol (IP), e.g. Voice over IP (VoIP) systems, internet Video and Internet protocol TV (IPTV)

• enhanced content and network management — driven by developments in

deep packet inspection and content filtering technologies

• emerging social web — acting both as a platform and a database- third party development of applications programming interfaces (APIs), mashups (e.g. content drawn from multiple websites), widgets (e.g. portable code that users can install and execute on their web-pages and web enabled mobile devices)

• continuing scientific and technological innovation — including new display

technologies that are leading to ultra thin screens.

The accelerating rate of change in IT — identified as the first trend above — makes it difficult to ‘forecast’ the state of the international IT sector in five years time. The trends identified above are likely to continue, however, new and innovative technologies may evolve requiring new types of skills. Nevertheless, if history is any guide, IT sector employees will need advanced skills providing the ability to quickly adapt to technological developments as they arise.


International outlook

The growth of IT has created a world market for skilled labour, leading to talk of a “skills crisis” in countries such as the UK. The UK Council of Professors and Heads of Computing (Council of Professors and Heads of Computing (CPHC)) argues that the UK IT workforce is under-skilled (27 per cent have IT or related degree qualifications, compared to a recommended level of 40-50 per cent) and that funding for training programs is inadequate. The UK is dependent on overseas trained IT experts for 50 per cent of its workforce needs (Council of Professors and Heads of Computing (CPHC)).

The UK experience is typical of the current world situation and reflects the impact of growing world demand for IT services and an international labour market for IT services, particularly at the professional and managerial level.

European data provides a benchmark for the achievement of a world standard IT industry. e-skills UK released a report providing guidance on the occupational and industrial structure of the modern IT workforce and future skill needs (e-skills UK 2008). The international nature of the IT labour force and the desire of Bahrain to move to a world-leading model make these data particularly applicable.



The largest single occupational group in the UK IT workforce in 2007 where IT professionals (comprising 66 per cent), followed by IT sales and marketing staff. Although not detailed in Table 9.4, it is notable that 42 per cent more IT professionals work in other sectors as work in the IT sector in the UK.

Table 9.4 UK INFORMATION TECHNOLOGY WORKFORCE: SPLIT BY OCCUPATION, 2007

Occupational Group IT sector (per cent) IT Prof essionals* 66 IT sales and market ing 8 IT customer care and contact centre occupations 2 Other technical (including designers) 6 Other 18

Notes: * see Table 9.5 for breakdown of IT professionals. Source: (e-skills UK 2008).

As highlighted in Table 9.4 IT professionals are the largest occupational group within the IT sector. The modern IT sector is heavily dependent upon an expanding group of IT professionals, including ICT Managers, IT strategy and planning professionals, and software professionals, to name a few (see Table 9.5).

Demand for IT strategy and planning professionals and software professionals is expected to increase by 2.6 and 2.7 per cent per annum respectively between 2007 and 2016. Within the UK IT sector, employment is expected to grow between 2006 and 2016 by an average of 2.5 per cent per annum, compared to 0.5 per cent average annual growth in total UK employment (see Table 9.5).

Table 9.5 IT AND TELECOMMUNICATIONS PROFESSIONALS IN UNITED KINGDOM 2007-2016

Description 2007

(per cent of sector

workforce)

Average annual growth

(per cent)

2016 (per cent of sector

workforce)

ICT Managers 27 1.4 26

IT Strategy and Planning 13 2.6 14

Software Professionals 30 2.7 33

IT Operations Technicians 12 0.8 11

IT User support 4 0.7 4

Database Assistants/Clerks 6 -0.8 5

Telecoms Engineers 4 -0.6 3

Line Repairers and Cable Joiners 2 -0.6 1

Computer Engineers 3 -0.6 3

Total 100 1.6 100

Source: (e-skills UK 2008).



IT In

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ry

Tele

com

Ind

ustr

y

IT/T

elec

om c

ombi

ned

IT P

rofe

ssio

nal

Tele

com

Pro

fess

iona

l

The most notable trends shown in Table 9.5 are the current importance of the first five listed occupations and their rate of increase over the period 2000-2007. ICT Managers, strategy and planning professionals, IT security professionals and software professionals and IT operations technicians account for over 80 per cent of the current IT labour force needs.

Education and training needs

International research suggests that across the ICT industry as a whole, most emphasis in the future will need to be placed on post school qualifications at the Advanced Diploma/Diploma level or above. This approach is displayed in the current ICT workforce in the UK, where staff with an Advanced Diploma/Diploma level or above, made up 75 per cent of the skill needs in the IT sector (see Table 9.6 below). The main difference between the two sectors is that the IT sector is expected to require considerably more staff than the telecommunications sector with post-graduate qualifications.

By way of international benchmarks in the educational distribution of the IT workforce, data from the UK suggests that future skills levels in the IT sector may approximately be broken up into 60 per cent University, 17 per cent Polytechnic and 16 per cent VET training. It is assumed that similar training levels will be required in the Bahrain IT sector.

Future skill needs will need to be filled through a combination of the output of educational institutions, including private providers, industry based training and external recruitment through migration and guest workers. The relative contribution from each group will be driven, in part, by the success of Bahrainisation in the IT field and by polices designed to stimulate IT training in Bahrain.

Table 9.6 IT AND TELECOM: UK EDUCATIONAL LEVELS IN 2007 (PER CENT OF WORKFORCE)

Education Level

Post-Graduate 12 6 10 12 1 D egree 45 32 40 46 11 Advanced Diploma/Diploma 17 28 21 19 44 Trade Cert if icate 16 21 18 14 27 High School completion 3 5 4 0 4 Other 7 6 7 6 8




For example, in the UK the flow of required ICT skill labour over the next decade is expected to come 45 per cent from new graduates (of universities and colleges) and 55 per cent from within-firm training and cross entry from existing professionals such as electrical engineers and migration (especially from the Indian sub-continent). This creates a potential problem for GCC countries such as Bahrain where the private sector does not have a strong history of providing in-house training and where there are few private IT training providers.


Figure 9.8 is a projection based upon current trends of labour demand in the IT sector over the period 2008 to 2012. On this basis it is expected that future employment in the IT sector will increase to approximately 9 200 jobs by 2012 (a 178 per cent increase compared to the number of jobs in 2007). Further, it is estimated that on the basis of current trends, employment of non-Bahrainis will grow by 217 per cent compared with 60 per cent growth for Bahraini nationals.

Figure 9.5

INFORMATION COMMUNICATIONS — 2008 TO 2012


The small size of this sector in Bahrain means that detailed data is not collected or available. This lack of appropriate data prevented more formal modelling of labour demand in this sector. However, the value of projection from past trends is that the technique provides an indication of the future labour market needs in the absence of policies targeted towards the industry.

A number of factors may change over the period, such as technological progress, the rate of economic growth, capital and labour substitution, or labour market bottlenecks that would significantly influence the expected outcomes. For this reason the projection length has been limited to the four year period. Over this time the main driver of demand shifts would be changes in the economic growth patterns of the Bahrain economy.



Employer and Employee survey results

Employers

A survey was undertaken of Bahraini employers with 39 responses received from IT sector organisations. The 331 employees encompassed by the survey’s respondents comprised 10 per cent of total employees within the sector and 0.5 per cent of total surveyed employers. Of the employees covered by the responses 70.7 per cent were non-Bahraini and males dominated females in the sector, with 89.7 per cent of surveyed employers capturing male employees.

The composition of the ICT sector is such that services and sales people followed by managers and business executives are the two largest first tier job categories. Table 9.7 shows first tier job categories by demographic group.

Table 9.7 FIRST TIER OCCUPATIONAL GROUPS — ICT

Bahraini

males

Bahraini females

Non- Bahraini

males




Engineers and engineering 12% 8% 20% 0% technicians




Construction occupations 0% 0% 6% 0%


Total 100% 100% 100% 100%


Non-Bahraini males are the largest demographic group within the sector and they are mainly involved in managerial and business executive positions. The second largest group in the sector are Bahraini males who predominantly work as sales and services employees followed by engineers and engineering technicians.

When asked to provide information on occupations at more detailed level (second- tier level), employers identified most employees in the sector as administrative managers (29 per cent), electronics technicians (22 per cent) and consumer goods salesmen (9 per cent).



Table 9.8

SECOND-TIER OCCUPATIONS — ICT SECTOR

Second-tier occupation Proportion of total sector responses

Administrative managers 30% Electronics technicians 23% Consumer goods salesm en 9% Engineering technicians 5% Mechanical technicians 3% Other 3% Mechanical engineers 2% Electronics engineers 2% Information systems technicians 2% Administrative clerical workers 2% Admin. and administrative development specialists 1%




to 117 occupation categories). 72 per cent of ICT employers who participated in the survey responded to the second-tier related questions

• for the ICT sector, the key second-tier occupation categories were compared to

relevant Bureau of Labor Statistics data for the United States in 2006 as a proxy to provide a benchmark to validate the forecast (Bureau of Labor Statistics 2006).


ICT sector and the outcomes of the stakeholder consultations undertaken as part of the Skills Gaps Research Study

• the key limitations for the results in the ICT sector are that the respondents to

the second-tier occupation categories were 72 per cent of the total sector responses.




Table 9.9 SECOND-TIER OCCUPATIONS (INDICATIVE FORECAST 2012) — ICT SECTOR

Indicative forecast Proportion of Second-tier occupation 2012 total forecast

occupation gap Administrative managers 800 14%

Electronics technicians 1400 25%

Consumer goods salesmen 500 10%

Engineering technicians 300 6%

Mechanical technicians 200 4% Other

Includes: • professionals in f inancial science • professionals in economics • professionals in accounting • accounting finance clerks

160 3%

Mechanical engineers

Electronics engineers

Information systems technicians

Administrative clerical workers

150 2%

150 2%

150 2%

1300 23% Admin. and administrative development

specialists 500 9%

Total indicative occupation gap in 2012 5610 100%


Employees in the largest first tier occupation groups earn, on average, lower wages than those employees in the same job in another sector. The average monthly wages for the top three occupational groups in the telecommunication sector are lower for services and sales people (BD202 compared to an average of BD244 for services and sales people across all sectors), managers and business executives (BD615 compared to an average of BD1090) and for engineers and engineering technicians (BD220 compared to an average of BD560). Figure 9.6 shows this comparison.

Figure 9.6

A WAGE COMPARISON — EDUCATION COMPARED TO ALL SECTORS




The survey asked questions regarding skill shortages and training activity. Table 9.10 details reasons given for not hiring additional staff. The most common response was that they were happy with the current number of employees.

Table 9.10 CONSTRAINTS OF HIRING STAFF AMONG IT SECTOR EMPLOYERS

Reason for not hiring staff Per cent reporting Yes

Lack of financial resources 15.4 Shortage of good candidates 12.8 Difficulty attracting good candidates 10.3 Difficulty attracting good candidates to location 2.6 Happy with number of staff employed 56.4


Employers responding to the survey indicated that they had vacancies for information systems technicians. In the IT sector 15.4 per cent of surveyed employers indicated that is was more difficult to recruit good quality staff than two years previously. Another 15.4 per cent reported that there was no change to recruitment difficulties compared to two years prior.

The survey also asked questions regarding the quality of skills possessed by staff, compared to two years previously. Respondents indicated that current recruits are at least of the same standard as two years previously for both Bahraini and non- Bahraini IT employees. For example 17.9 per cent of respondents indicated that Bahraini recruit had higher standards in terms of technical and generic skills among Bahrainis and 20.5 per cent of employees agreed that non-Bahraini’s had higher standards in these areas. Additionally, all employers responded that non-Bahraini standards for technical and generic skills were not lower than two years previously and 97.4 per cent of employers agree for Bahraini employees.

When recruiting in the ICT sector employers are attracted by customer technical ‘know-how’ skills, which is intuitive for this industry. Customer communication skills are also highly valued as are work communication skills. In contrast, a low priority is given to planning skills and emotional skills. Figure 9.7 shows the importance of work related skills to employers in the ICT sector.





ICT employers also identified the top five skills required in the sector, which are outlined in Table 9.11. The most commonly identified skill required in the ICT sector was technical skills (33 per cent of total responses), followed by sales and marketing skills (11 per cent).

Table 9.11 TOP FIVE SKILLS — ICT


Technical Skills 33% Sales and marketing skills 11% Communication skills 9% Customer service skills 4% IT knowledge skills 4%


Employer survey responses indicate that a small proportion of employers provide training to employees. Of the employers that do, a range of training was provided over the past 12 months. Out of all surveyed employers, 10.3 per cent provided induction training and 17.9 per cent provided in-house technical training. Furthermore, 18 per cent indicated that they provided training in-house, whereas 7.7 per cent purchased training externally from within Bahrain, and another 2.6 per cent reporting that they purchased training from overseas.

Over the next five years the aggregation of ICT sector employers responses reveals that the sector as a whole as it stands currently intends to create 136 jobs. This number of jobs is modest compared to the aggregated responses from the business and manufacturing sectors and are mainly in the areas of services and sales as well as in engineering and engineering technician positions.



Employees


undertaken. Among survey respondents, 8.5 per cent advised that they had specialised in computer science in their studies. However, only 2.3 per cent of respondents advised that they currently worked in the IT sector.

The survey highlights that the IT sector relies heavily upon expatriate staff, with 55 per cent of current IT sector employees indicating they were born outside Bahrain, with only 36 per cent advising that they were citizens of Bahrain. Among respondents currently employed in the IT sector, 68.2 per cent possessed a Bachelors degree or higher, with 64 per cent of respondents advising that they had studied outside Bahrain (see Table 9.12) and 59 per cent advising they that they had worked outside Bahrain. Indeed, 52.4 per cent of respondents indicated that their first employment was in another country.

Table 9.12 HIGHEST EDUCATIONAL QUALIFICATION COMPLETED: IT SECTOR EMPLOYEES


Prim ary/Secondary school 9.1 Certif icate/D iplom a 22.7 Bachelor degree 40.9 Postgraduate degree 9. Masters degree 18.2 Total 100


Among current IT sector employees, the most common occupation was ‘business professional’ (27.3 per cent) followed by ‘engineer/technician’ (18.2 per cent). A majority of respondents (55.6 per cent) indicated that their previous employment was in the IT sector. The next most common sector of previous employment was ‘Business Services’, accounting for 27.8 per cent of current IT sector respondents.

Survey respondents also commented on the skills they see as important for their jobs (now and in the future). Respondents highlighted that all of the 12 skills sets suggested were highly important, except for persuasive skills and checking skills. Given the attention to detail required in IT, it is notable that checking skills were not considered highly important.

In addition, survey respondents highlighted attitudinal characteristics that they found influential in a job (see Figure 9.8). Respondents from the IT sector found that remuneration was very highly influential (4.06 out of 5), whereas work culture was the least influential for IT among all sectors examined.

6 From a total of 975 respondents, 22 worked in the IT sector.



Figure 9.8 ATTITUDES ABOUT WORK: INFORMATION TECHNOLOGY



Stakeholder consultations indicated a current shortage of appropriately trained IT personnel. In addition to IT staff working for both IT services and IT providers, a large number of IT staff are employed in the financial services sector. Stakeholders indicated that it is commonplace for skilled IT personnel to be recruited by banks, which typically pay higher wages.

University training

Conflicting advice was provided by stakeholders on the quality of university-level IT training provided by the University of Bahrain. For example, Zain International, a mobile telecommunications company based in Bahrain, considered that IT training provided by the University of Bahrain was adequate. However, a larger proportion of stakeholders felt that IT graduates from the university were not ready for work, lacking industry specific skills.

Through stakeholder consultations an IT provider made the observation that the quality of Bahraini IT graduates has declined over the previous 10 years, with motivation and ‘soft’ skills a particular weakness.

Industry training

The Bahrain Telecommunications Company (Batelco) operates its own training facility. However, this company has significant difficulties in retaining staff, which are often lured by higher salaries available in the banking sector. The relatively high turnover of staff acts as a disincentive for firms to invest heavily in training and professional development.

At the regional conference held in November 2008, it was suggested that employers may need to introduce continuous training, so as to ensure that their staff maintain and develop new skills.

Specific shortages.

Stakeholders consulted as part of this project indicated that IT skill shortages were most acute in network security.



A focus group undertaken in April 2008 by the Bahrain Internet Society and Labour Market Fund identified a wide range of IT professions that were experiencing shortages. These included application specific skills, such as MCSE and Cisco certified personnel, IT project managers, and system administrators.


The skills gaps in Bahrain’s ICT sector are apparent from the findings of the labour market analysis, surveys and other reports. Currently, ICT sector skills gaps fall into three main categories:

• ICT management and coordination skills

• certified software application technical skills

• IT strategy and planning skills.



• 1 200 managers

• 1 100 engineers/technicians

• 650 scientists/technicians managers.

Addressing management and coordination shortages is crucial to the future of the ICT sector in Bahrain. The projected expansion of the sector’s workforce is likely to increase demand for appropriately trained managers. Stakeholders have already noted the dearth of such personnel in Bahrain. Furthermore, data from the UK suggests that the global ICT sector’s reliance on ICT managers and IT strategy and planning professionals will continue over the next decade.

Stakeholders expressed a strong need for employees with application specific skills, such as Microsoft Certified Systems Engineers and Cisco certified personnel. International trends also suggest that demand for software professionals will grow over the next decade (by approximately 2.7 per cent per annum). Given the reliance of the Bahraini ICT sector on foreign workers, this may exacerbate the shortage of certified software personnel in Bahrain.

Installing and maintaining network security infrastructure is vital for ensuring effective connectivity in Bahrain’s ICT sector and an area that stakeholders indicated was suffering from acute skill shortages.

Data from the UK suggests that the global ICT sector will experience increased demand for post-school/graduate qualifications and effective in-house training solutions. Government and industry policies to address the skills gaps in the Bahraini ICT sector will need to take these trends into account.

The key skills gaps identified for the ICT sector are summarised in Table 9.13, including the sources from where the skills gaps have been highlighted.



Table 9.13 SKILLS GAPS SUMMARY — ICT

Study input ICT Management & Coordination

Certified Software Personnel

IT strategy and planning

Labour market analysis ü û û Qualifications analysis û û û Survey of employers û û û Survey of employees û û û Survey of graduates û û û Survey of Education Institutes û û û Key stakeholder consultations ü ü ü

Other information sources ü ü û


9.7 SWOT snapshot

On the basis of the analysis above, a snapshot of the strengths, weaknesses, opportunities and threats to the ICT sector in Bahrain has been completed (see Table 9.14) summarised information will be used to inform action plans for a smaller number of sectors in Report 4.

Table 9.14 SWOT — INFORMATION TECHNOLOGY

STRENGTH WEAKNESS • Strong demand for qualified and trained staff expected to

continue. • Quality of telecommunications training provided both in-

house and externally.

• Poor school-level achievement in mathematics and science.

• Insufficient IT-related places at training institutes, including university.

OPPORTUNITY THREAT • International IT sector employment is growing faster than

all sectors combined. • New applications are expected to ensure ongoing need for

trained staff.

• Ability of IT sector to retain skilled staff within sector • IT developments in other GCC nations may attract trained

staff.



In the absence of any changes within the Bahrain IT sector, the skill shortages highlighted above are expected to continue. Indeed, analysis from the UK suggests that employment of IT-trained personnel will increase faster than employment across all sectors combined.

In this context, the problem of insufficient numbers of IT-trained personnel in Bahrain is expected to grow.



Overlaying growing demand for skilled personnel will be future developments in the global IT industry. The specific nature of these developments is not known. However, past experience suggests personnel with strong fundamental IT skills and knowledge will be able to adapt to new IT technologies more rapidly than personnel only possessing application-specific skills and knowledge. Indeed, new IT hardware and software applications are increasingly technical and complex, requiring highly skilled personnel for both operation and maintenance.



Chapter 10

Telecommunications


Telecommunications operators in Bahrain

The Bahrain telecommunications market may be described as a loose oligopoly. It has a dominant firm, the Bahrain Telecommunications Company (Batelco), a cluster of second tier companies and a longer tail of smaller, single or multiple product firms. Batelco is majority owned by the Government of Bahrain, and provides fixed-line, mobile, Internet and IT services. In 2007, Batelco employed 1440 staff (Bahrain Telecommunications Company (Batelco) 2008a). Batelco also owns or operates telecommunications services in a number of other middle eastern countries, including Jordan, Yemen, Egypt, Saudi Arabia and Kuwait. (Paul Budde Communications Pty Ltd (BuddeComm) 2008).

Other major players in the Bahrain telecommunications market include:

• Zain Bahrain - mobile voice and high-speed mobile data services

• Mena Telecom - international fixed-line and satellite Internet services

• Lightspeed Communications - fixed-line and IP-based services

• Kalaam Telecom –voice, Internet and data services.

As at February 2008, there were 17 licensed telecommunications operators in Bahrain. Of these only Batelco offers the full suite of telecommunications services. Many providers only offer one or two services (see Table 10.1).

The most common service offered is international calls, provided by 15 of the 17 providers. The relative importance of the international call service reflects the large expatriate population living in Bahrain. By comparison, there are three providers of national fixed services, and two providers of mobile services.



Nat

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ed

Inte

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Inte

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ine

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ata

serv

ices

Table 10.1 SERVICES OFFERED BY TELECOMMUNICATIONS LICENSEES

Licensees

2Connect

ANIS ü ü

ü

ü ü ü

Batelco ü ü ü ü ü ü

BT Solutions Ltd ü Business Communication Networks ü Etisalcom ü ü Fakhro IT Services ü Fastelco (TeleGulf) ü Kalaam Telecom ü ü ü Light Speed ü Mena Telecom

Northstar

ü ü

ü

Nuetel Communications

Orbit

Swiftel International

ü ü ü

ü

ü ü

Viacloud

Zain (Bahrain)

ü

ü

ü

ü

Total 3 15 2 7 4 4

Source: (Telecommunications Regulatory Authority 2008).

Regulatory environment

Bahrain has liberalised its telecommunications market in recent years, and is now one of the most open in the region (Paul Budde Communications Pty Ltd (BuddeComm) 2008).

A telecommunications law passed in 2002 established an independent regulator, the Telecommunications Regulatory Authority (TRA). The first National Telecommunications Plan accompanied this law. As a result, competition was introduced into the mobile market in 2003, followed in 2004 by liberalisation of all other sectors of the industry.

Increased competition through the introduction of new alternative operators has resulted in prices falling for both international fixed-line voice calls and broadband Internet (Paul Budde Communications Pty Ltd (BuddeComm) 2008).

The second National Telecommunications Plan, released in 2008, sets out government policy for the further development of the sector over the following three years (Prime Minister 2008). Key features of the plan include:



• improving services, terms and prices for telecommunications users

• increasing competition within the telecommunications sector

• using regulatory instruments to create a ‘competition-like’ environment

• becoming a regional centre for telecommunications innovation

• stimulating private sector investment and entrepreneurship in telecommunications.

In support of this last objective, the Second National Telecommunications Plan indicates that additional support for education and training will be provided by the government to develop decision making and management skills within the industry.

Following the release of the Second National Telecommunications Plan, the TRA conducted a market review, and developed a package of measures to promote competition and the interests of consumers. These measures included:

• overhaul of the retail regulation regime (Q4 2008)

• introduction of local loop unbundling (Q4 2009)

• carrier pre-selection on a call by call basis (Q2 2009)

• introduction of a third mobile network operator (Q1 2009)

• removal of the mobility restriction for National Fixed Wireless Services

licensees (Nov 2010)

• introduction of number portability for fixed and mobile services (Q3 2009).

Sector performance

Both fixed-line and mobile penetration are high by regional standards. Mobile penetration is well over 100 per cent, and is the highest in the GCC. Broadband subscriber numbers are also starting to grow rapidly, with household penetration reaching 45 per cent (Paul Budde Communications Pty Ltd (BuddeComm) 2008).

Figure 10.1 indicates that there has been steady growth in fixed lines in the previous ten years. Over the same period, there has been rapid growth in the number of mobile service customers. The fact that mobile penetration exceeds 100 per cent reflects the fact that some customers, particularly expatriate staff, have more than one mobile service. For example, expatriate staff may have one mobile service for local calls, and another for international calls.



Figure 10.1 TELECOMMUNICATIONS MARKET SIZE: FIXED LINES AND MOBILE SERVICES

Note: The drop in 2007 in teledensity among fixed lines, and penetration among mobile services, is due to revisions to the estimated Bahrain population.

Source: (Paul Budde Communications Pty Ltd (BuddeComm) 2008).

Bahrain’s relative position

Bahrain rates very highly (eight from 127 countries) in terms of mobile phone subscriptions. This is the highest level of penetration in the Arab world and exceeds the UAE (tenth). This level of penetration provides Bahrain with a platform to expand services through market expansion and deepening through linking mobile and Internet services (INSEAD 2008).

The level of broadband penetration in Bahrain is also high for the region. Table 10.2 shows that Bahrain had a 45 per cent level of penetration in 2006, equal to that of Qatar and exceeds Saudi Arabia and Oman.



Table 10.2 BROADBAND HOUSEHOLD PENETRATION IN GCC: 2006

Country Household penetration

(per cent)

Bahrain 45

Oman 4

Qatar 45

Saudi Arabia 7

UAE 60

Source: (Paul Budde Communications Pty Ltd (BuddeComm) 2007).

Bahrain also compares well with the rest of the Middle East in terms of telecommunications take-up. Table 10.3 shows that of the selected countries, Bahrain has the highest Internet penetration at 26 per cent, followed by Jordan at 18 per cent. Bahrain also has a high annual growth rate, at 16 per cent. Both Egypt and Jordan have higher annual growth rates, at 20 per cent but lag behind Bahrain in terms of internet penetration.

Table 10.3

INTERNET USERS, PENETRATION AND GROWTH IN SELECTED MIDDLE EAST COUNTRIES

Country Internet Users

(millions) Internet penetration

(per cent) Annual growth

(per cent)

Bahrain 0.18 26 16

Egypt 6 8 20

Iran 7.5 11 7

Jordan 1 18 20

Source: (Paul Budde Communications Pty Ltd (BuddeComm) 2007), based on IMF, ITU and Industry data.

The position and future prosperity of Batelco remains crucial to the future of the industry. In the wider Middle East market four operators are vying for supremacy: Etisalat of the UAE, most of whose subsidiaries are in Africa; MTC of Kuwait; and, more recently, Qtel of Qatar.

Orascom of Egypt also has a very significant presence in Africa and West Asia but has sold some subsidiaries and is concentrating particularly on high population and very low penetration countries. Batelco of Bahrain is a latecomer to the market but is not yet on the scale of the other four (Telecoms Market Research 2007).

Skills formation in the telecommunications sector

There is limited telecommunications-specific training available from Bahrain training institutes and universities. This is reflected in a survey of Bahraini telecommunications providers, which identified that all six companies responding to the survey provided in-house technical training.



The breadth of training and development undertaken within the telecommunications sector is demonstrated by Batelco (see Box 10.1).

Box 10.1 TRAINING AND DEVELOPMENT UNDERTAKEN BY BATELCO

Batelco invests significant amounts in training and development to ensure staff have the skills required to meet company priorities. Training takes place either at the Batelco Training Centre, locally in Bahrain or overseas. In 2007, Batelco spent BD 3.75 million on Training and Development. This expenditure resulted in: • 755 separate training activities • 132 085 training hours (an increase of 39 per cent from 2006) • 289 staff completing a total of 570 e-Learning courses. 1299 Batelco staff undertook training and development, representing 90 per cent of employees. The largest individual training category was telecommunications (31 886 training hours) followed by management (30 514 hours). Batelco’s training and development activities were rewarded in 2007 by the Labour Ministry, which presented the company with awards for excellence in Training and Developm ent. Training programs provided by the Batelco Training Centre include: • contract supervision • planning and design • networking.

Source: (Bahrain Telecommunications Company (Batelco) 2008a), (Bahrain Telecommunications Company (Batelco) 2008b).

10.2 Telecommunications in Bahrain

The telecommunications sector in Bahrain consists of services such as fixed telephone, mobile telecommunication and telecommunication service providers.

In recent years there has been convergence between telecommunications and information technology (IT), driven largely by growth of the Internet. This convergence means there is overlap between the two sectors to the point that it is difficult to separate telecommunications from IT. Therefore, there is a degree of overlap between this chapter and the companion chapter on IT.

The telecommunications sector is estimated to comprise 3.1 per cent of Bahrain GDP in 2006 (BD183 million), which is considerably higher than its share of employment and, as a result, indicates a relatively high value add per employee. However, this share is lower than the relative contribution in 2002, when the telecommunications sector comprised 3.9 per cent (BD124 million) of GDP. Although the sector has grown in an absolute sense it has lost ground to other sectors in terms of percentage of GDP. Nevertheless, it has to be acknowledged that telecommunications is a fundamental form of infrastructure underpinning growth in the economy as a whole.

Bahraini Government data reports that in 2007 the Bahrain telecommunications sector employed an estimated 2410 staff, comprising 0.5 per cent of total Bahrain employment. This number represents a small change from 2002, when the telecommunications sector employed an estimated 2370 staff (0.8 per cent of total employment).



GROSS DOMESTIC PRODUCT AND EMPLOYMENT: TELECOMMUNICATIONS SECTOR

Source: (Civil Service Bureau (CSB) 2008a), (General Organization for Social Insurance (GOSI) 2008), (Labour Market Regulatory Authority 2007) and (Central Informatics Organization 2007).

Data from GOSI estimates the size of the telecommunications labour market from 2002 to 2007 (see Figure 10.2). The labour market grew by 1.9 per cent from 2002 to 2007 from 2367 to 2412 employees. In 2007, 82 per cent of employees were Bahraini.

Figure 10.2

NUMBER OF EMPLOYEES IN TELECOMMUNICATIONS SECTOR (2002 — 2007)


10.3 International trends in telecommunications

Developments in telecommunications technology and provision

A number of specific changes are expected to have an increasing impact on telecommunications workforces in the future, comprising:

• establishment of packet-based Internet protocol networks

• telecom providers offering IT services and IT providers offering telecom

services using IP networks

• potential for new technologies such as WMAX (Worldwide interoperability for microwave Access) to offer new means of delivery of voice and data service



• potential of wide scale introduction of Radio Frequency Identification Device (RFID) with a consequent increased focus on information.

The dominant factor in the development of telecommunications will be its convergence with IT.

Some analysts argue there will also be substantial unbundling of the telecommunications sector. This unbundling may separate functions in the telecommunications and information domain into access network providers, core network providers, service providers, portal providers and content providers (Van der Mei 2007).

Industry structure and ownership

The introduction of mobile technology resulted in changes to the structure of the telecommunications sector in many countries. This change facilitated the entry of a number of private providers and coincided with considerable increases in demand. Foreign investment also allowed the diversification of many telecommunications industries, leading to the development of privatisation opportunities.

Increasingly GCC governments are beginning to recognize that telecommunications is necessary for continued economic growth. Membership of international organisations such as the World Trade Organisation (UNWTO Resilience Committee Preparatory Meeting) will make these countries subject to requirements of the General Agreement on Trade Services, requiring the opening of telecommunications industries (Schwartz 2008).

The problem in the region remains that since telecommunications is a utility and subject to government control, there are often significant costs in dealing with administrative processes and procedures. As a result, there is a trend in the region towards privatisation and development of the telecommunications industry. Over the next decade it is estimated that Gulf States will spend approximately 25 per cent of funds devoted to infrastructure development on the expansion of the telecommunications sector. (Telecoms Market Research 2007).

Convergence

Telecommunications is a subset of the information and communications technology industry. In the past the former concerned itself with voice transmission and was hardware driven, while the IT component of ICT was data intensive and software driven (e-skills UK 2008). Now the two sectors are converging (Schwartz 2008).

Telecommunications, computing and networking are moving from hardware to software platforms, with embedded voice communications capability already offered on the Internet (e-skills UK 2008).

Convergence is having profound implications for the telecommunications sector in particular, along with the relationship between ICT, telecoms and content providers. As a result customers are seeking high-speed access to any content or application using any device.



Software plays a critical role for convergence, acting as a linking device to the Internet, phones and mobile devices and multi-media services. For telecommunications companies this means that value adding is generated through providing sophisticated services and solutions. Of particular significance are products derived from voice and data convergence and various linkages between Internet protocol and IT network architecture, fixed/wireless/mobile convergence; telecom/media /content service convergence and device convergence (Council of European Professional Informatics Societies (CEPIS) 2007).

Both IT and telecommunications companies are changing their offerings and partnerships to take advantage of global opportunities in mobile communications business consulting, networked information services and entertainment. These changes are increasing the scope of roles in telecommunications as well as generating the need for up-skilling of the existing telecommunications workforces.

Skills and workforce trends

The implications of the above trends for labour and skill requirements are less well known but some clear inferences can be drawn. It is clear that the traditional hardware driven, process applications of telecommunications are giving way to software driven multi-layered developments. This transition will have substantial implications for labour supply needs.

Across the developed world the demand for traditional telecom skills — telecommunications engineers, line repairers and cable joiners, and computer engineers (telecommunications) — has fallen. This decline is in contrast to other ICT occupations. Furthermore, productivity improvements, driven by a combination of technological improvements and increased competition, have reduced the demand for telecom specific services and staff (Shahid and Shoulian 2007).

In contrast the demand for telecom business analysts, sales staff and IT literate general staff has grown substantially.

10.4 Future labour and skills needs in the telecommunications sector

International outlook

Traditional telecommunications staff, comprising staff in the connectivity area, hardware installation and maintenance are expected to be in less demand. This reduced demand is driven by productivity gains and the drive for competitive advantage through technical change that reduces the need for traditional staff.



The future of skills needs in the telecommunications industry is likely to be a combination of general ICT skills accompanied by an expansion of business and management skills (e-skills UK 2008). Accordingly, IT literate staff and those skilled in e-business techniques will be in greater demand within the telecommunications sector. This suggests the emergence of a smaller but more productive workforce and a stronger fusion of academic and technical skills. For example, there will be a need for computer engineering, computer science and info- mechatronics. These are traditionally university-based skills but will interact in the future with advanced diplomas in information technology and multimedia which are usually the product of vocational training (Queensland Government Department of Education and Training (DET) 2006). These are global skills trends that will affect Bahrain along with all other countries with advanced telecommunications.

The recent report Technology Counts: IT and Telecom Insights, 2008 provides guidance on the occupational and industrial structure of the UK telecommunications workforce (e-skills UK 2008). The UK telecommunications sector provides a benchmark for a world standard telecommunications industry. The international nature of the telecommunications sector and the desire of Bahrain to become a world leader make this data applicable.

Table 10.4 details the make-up of the UK telecommunications labour force in 2007. The largest occupational group were IT professionals (comprising 20 per cent), followed by IT Telecommunications customer care & contact centre occupations.

Table 10.4 UK TELECOMMUNICATIONS WORKFORCE: SPLIT BY OCCUPATION, 2007

Occupational Group Telecommunications sector

(per cent)

IT Professionals 20

Telecommunications Professionals 9

Telecommunications sales and marketing 12

Telecommunications customer care & contact centre 23 occupations

Other technical (including designers) 12

Other 24

Notes: See Table 10.5 for breakdown of IT professionals. Source: (e-skills UK 2008), p. 25.

Of the professions detailed in Table 10.5, demand for ICT Managers is expected to increase by 1.4 per cent per annum between 2007 and 2016. Over the same period, there is expected to be a reduction in demand for telecommunications engineers, line repairers and cable joiners of 0.6 per cent per annum. Within the UK telecommunications sector, employment is expected to grow between 2006 and 2016 by an average of 0.3 per cent per annum, compared to 0.5 per cent average annual growth in total UK employment.



Table 10.5 IT AND TELECOMMUNICATIONS PROFESSIONALS IN UNITED KINGDOM 2007-2016

Description 2007

(per cent of sector

workforce)

Average annual growth

(per cent)

2016 (per cent of sector

workforce)

ICT Managers 27 1.4 26

IT Strategy & Planning 13 2.6 14

Software Professionals 30 2.7 33

IT Operations Technicians 12 0.8 11

IT User support 4 0.7 4

Database Assistants / Clerks 6 -0.8 5

Telecoms Engineers 4 -0.6 3

Line Repairers and Cable Joiners 2 -0.6 1

Computer Engineers 3 -0.6 3

Total 100 1.6 100


Implications for Bahrain

For Bahrain to develop adequate numbers of Bahraini telecommunications professionals there will need to be a greater linking of training regimes between institutions and companies providing tertiary, vocational or in-firm training.

At the same time there will be a strong role within the industry for employees with applied and vocational training, including those who have undertaken school based vocational training. A major requirement will be for employees who are adaptable, flexible and able to change functional skills quickly. Bahrain will need to improve linkages between organisations providing tertiary, vocational and/or in-firm training. The apparent lack of workplace ready graduates, both from a lack of vocational training, and due to university curriculum being focussed upon arts, has been identified as a problem for the industry by local firms.


In contrast to a number of other sectors, the telecommunications sector has a high proportion of Bahraini workers. Of a total staff of 2412 in 2007, 1977 (82 per cent) were Bahraini workers. One reason for this is the relative preference shown by females in Bahrain for work within the industry. Another factor may be the employment policies of the government owned Batelco, which reported that 93 per cent of staff were Bahraini in 2007 (Bahrain Telecommunications Company (Batelco) 2008a).

Taken with the increasing number of females undertaking tertiary studies in Bahrain, this suggests a stable source of domestic labour supply for this industry (see Figure 10.3).



The economic modelling of this sector suggests that despite this source of domestic labour the proportions of Bahraini workers by 2012 will fall to 76 per cent, but have an increasing proportion made up of females. In 2012, the total level of employment is predicted to reach 3000, of which 2300 will be Bahraini (approximately 76 per cent). Most growth will occur among Bahraini males, with females showing a steady upward trend in employment. Labour shortages are most likely to occur in the software and telecom engineering areas.

Figure 10.3 TELECOMMUNICATIONS EMPLOYMENT — 2008 TO 2012.


The above economic projection is based on the assumption the past trends over time will continue. The projection does not take into account factors that are known to impact upon employment, such as economic growth, the rate of technological change, absolute and relative wage rates, and the rate of capital–labour substitution. Significant change in any of these factors would impact upon the above estimates. The value of the projection is that provides a ‘base case’ and thus a comparator for policy development. The projections have been restricted to four years to minimise the potential for significant change.

Employer and employee surveys

Employer Survey

A survey was undertaken of Bahraini employers, with 9 responses received from telecommunications sector organisations. The employer survey captured 1384 out of the 2412 total employees in the telecommunications sector, representing 57.4 per cent of employees and 2.1 per cent of total surveyed employers. Of the employees captured in the survey, the majority — 89 per cent — are Bahraini and males dominate females, comprising 67.9 per cent of the employees.

The composition of the telecommunications sector is such that scientists and science technicians, followed by services and sales people are the two largest first tier job categories. Table 10.6 shows first tier job categories by demographic group.



Table 10.6 FIRST TIER OCCUPATIONAL GROUPS — TELECOMMUNICATIONS

Bahraini males

Bahraini females

Non- Bahraini

males


Managers and business 11% 14% 42% 0% executives

Engineers and engineering 62% 29% 19% 0% technicians




Total 100% 100% 100% 100%


Bahraini males are the largest demographic group within the sector and they are mainly involved in engineering and engineering technician positions. The second largest group in the sector are non-Bahraini males who predominantly work as managers and business executives followed by sales and services employees.

Employers also separated their employees by second tier occupations. In this breakdown the telecommunications sector is dominated by salesmen who comprise 16 per cent of employees. Information systems technicians and sales/purchasing mediation positions are both the second largest groups employees within the sector. Table 10.7 lists second tier occupations by the proportion of employees within the telecommunication sector.



Table 10.7 SECOND TIER OCCUPATIONS — TELECOMMUNICATIONS

Second Tier Occupation

Proportion of total sector responses

Salesmen 16% Information systems technicians 11% Sales/Purchasing mediation 11% Administrative clerical 9% Other 9% Secretaries 8% Supervisors of sections 7% Commercial managers 5% Private sector managers 5% Consumer goods salesm en 4% Administrative managers 3% Engineering technicians 3% Heads of sections 3% Other managers 1%


Table 13.4 shows an indicative forecast to 2012 of second-tier occupations that apply to the telecommunications sector. The indicative forecast is based on the following method:


to 117 occupation categories). 56 per cent of telecommunications employers who participated in the survey responded to the second-tier related questions

• for the telecommunications sector, the key second-tier occupation categories

were compared to relevant Bureau of Labor Statistics data for the United States in 2006 (coupled with projections to 2016) as a proxy to provide a benchmark to validate the forecast. A benchmark was unavailable from Bahrain or any other GCC State (Bureau of Labor Statistics 2006)


telecommunications sector and the outcomes of the stakeholder consultations undertaken as part of the Skills Gaps Research Study

• the key limitations for the results in the telecommunications sector are that the

respondents to the second-tier occupation categories were 56 per cent of the total sector responses. In addition, there is a limitation of using the United States as a proxy because the telecommunications sector in Bahrain and the United States will have some differences in workforce needs.




Table 10.8

SECOND-TIER OCCUPATIONAL GROUPS (INDICATIVE FORECAST 2012) — TELECOMMUNICATIONS

Proportion of total

Indicative forecast forecast occupation Second-tier occupation 2012 gap

Salesm en Inc ludes: • sales/purchasing mediation • consumer good salesmen Other Inc ludes: • installation, maintenance and repair

occupations • financial analysts • human resource spec ialists • market research analysts Private sector managers Inc ludes: • supervisors of sections • commercial managers • administrative managers • heads of sections • other managers Administrative clerical Inc ludes: • secretaries

90 34%

70 26%

30 11%

30 11%

Information systems technicians Engineering technicians

30 11%

20 7% Total indicative occupation gap in

2012 270 100%


Employees in the largest first tier occupation groups earn, on average, higher wages than those employees in the same job in another sector. The average monthly wages for the top three occupational groups in the telecommunication sector are higher for engineers and engineering technicians in the telecommunications industry compared to all sectors (an average of 962.5BD compared to 560.3BD for all engineers and engineering technicians in the survey). Average wages for services and sales people are also higher compared to the average for all sectors (612.9BD compared to 243.9BD) similarly for the average wages of managers and business executives in the telecommunications industry (2210.0BD compared to 1086.7BD for all managers and business executives in the survey). Figure 10.4 represents these differentials graphically.



Figure 10.4 A WAGE COMPARISON — TELECOMMUNICATIONS COMPARED TO ALL SECTORS


The survey asked a range of question regarding skill shortages and training activity. Table 10.9 details reasons given for not hiring additional staff. The most common response given by telecommunication sector employers was that there is a shortage of good candidates.

Table 10.9

CONSTRAINTS FROM HIRING STAFF AMONG TELECOMMUNICATION SECTOR EMPLOYERS

Reason for not hiring staff Per cent reporting Yes

Lack of financial resources 11.1 Shortage of good candidates 66.7 Difficulty attracting good candidates 11.1 Difficulty attracting good candidates to location 11.1 Happy with number of staff employed 44.4

Source: Employer survey

Among telecommunication sector employers responding to the survey, 44.4 per cent indicated that it was harder to recruit good quality staff than two years previously. A further 11.1 per cent of respondents indicated that there had been no change in recruitment difficulties, with one-third of respondents indicating that recruitment was easier than two years previously.

The survey also asked a number of questions regarding the quality of skills possessed by staff, compared to two years previously. Answers to these questions suggested that higher standards are being attained by both Bahraini and non- Bahraini staff in the telecommunications sector. For example, 55.6 per cent of respondents indicated that there were higher standards of technical and generic skills for both Bahraini and non-Bahraini staff compared to two years previously. Additionally, none of the surveyed employers agree d that these skills were of lower standards among both Bahraini and non-Bahraini recruits.



When recruiting in the telecommunications industry employers are attracted primarily by customer communication skills and technical ‘know how’. Literacy skills and work communication are also highly valued. In contrast, a low priority is given to physical skills. Figure 13.17 shows the importance of work related skills to employers in the telecommunications sector.

Figure 10.5

IMPORTANCE OF WORK-RELATED SKILLS


Telecommunications employers also identified the top five skills required in the sector, which are outlined in Table 11.6. The most commonly identified skill required in the telecommunications sector was communications skills (17 per cent of total responses) and technical skills (17 per cent).

Table 10.10

TOP 5 SKILLS — TELECOMMUNICATIONS

Skill type Proportion of total responses Communication Skills 17% Technical skills 17% Management skills 8% Customer service skills 4% Leadership skills 4%


Employer survey respondents also indicated that they provided a range of training in the past 12 months, with 77.8 per cent providing in-house induction training and 88.9 per cent providing in-house technical training. Furthermore, 77.8 per cent indicated that they provided training in-house, whereas 55.5 per cent also purchased training externally from within Bahrain, and 55.5 reported that they purchased training from overseas.



A small number of training institutes responding to the survey offer telecommunications-specific courses. Table 10.11 details the number of institutions offering telecommunications courses at different qualification levels.

Table 10.11

QUALIFICATIONS OFFERED BY TRAINING PROVIDERS OFFERING TELECOMMUNICATION COURSES

Qualification Number of providers Certificate / Diplom a 3 Bachelors degree 3 Postgraduate diploma 1 Masters degree or PhD 1


In the next five years the telecommunications sector intends to expand by 132 jobs. This number of jobs is modest compared to the aggregated responses from the business and manufacturing sectors. New telecommunications jobs will mainly be in the area of science and technologists as well as services and sales.

Employees


undertaken. Among survey respondents, 8.5 per cent advised that they had specialised in computer science in their studies, with 11.4 per cent indicating that they had specialised in engineering. However, only 3.6 per cent of respondents advised that they currently worked in the telecommunications sector.

The survey highlights that the telecommunications sector largely employs Bahraini staff, with 76.5 per cent of current telecommunications sector employees indicating that they were born in Bahrain. Among respondents currently employed in the IT sector, 58.8 per cent possessed a Bachelors degree or higher (see Table 10.12). Furthermore, 41.2 per cent of respondents advised that they had studied outside Bahrain, and 23.5 per cent advised that they had worked outside Bahrain.

7 From a total of 975 respondents, 34 worked in the telecommunications sector.



Table 10.12 HIGHEST EDUCATIONAL QUALIFICATION COMPLETED


Prim ary/Secondary school 8.8 Certificate / Diplom a 26.5 Bachelor degree 41.2 Postgraduate degree 2.9 Masters degree 14.7 Other 5.9 Total 100


Among current telecommunications sector employees, the most common occupation was ‘manager’ (32.4 per cent) followed by ‘service & sales’ (17.6 per cent). Among those respondents not working in their first job, one-third indicated that their previous employment was in the ‘Business Services’ sector, with 22.2 per cent of respondents indicating that their previous employment was also in the telecommunications sector.

Survey respondents also commented on the skills they see as important for their jobs (now and in the future). On average, respondents highlighted that all of the 12 skills sets suggested were highly important, except for work communication skills.

In addition, survey respondents highlighted attitudinal characteristics that they found influential in a job (see Figure 10.6). Respondents from the telecommunications sector did not identify any characteristics as very highly influential, but did find remuneration, work environment and work-life balance as highly influential. (between 3.60 and 3.90 out of 5).

Figure 10.6 ATTITUDES ABOUT WORK — TELECOMMUNCATIONS





Batelco is identified as a regional trainer in ICT/Telecommunications. This is important if Bahrain is to establish itself as a regional leader in this industry. The problem faced by this company is one of loosing graduates trained on the job to other organisations and other sectors. The company represents an important link to future development of company based vocational training and establishing training links with educational institutions.

Separately, Zain Bahrain indicated that higher education providers are not providing students with the range of telecommunications expertise that it requires.

Stakeholders emphasized the lack of proper training within the telecommunication sector and that the educational system does not satisfy the requirements of the sector in terms of educational background. It was stated that this causes a problem for smaller organisations when trying to attract qualified candidates to the sector.

10.5 Skills gap analysis

The extent to which the telecommunications sector in Bahrain is suffering from specific skills gaps is unclear, given:

• the relatively high levels of mobile, broadband and Internet penetration in

Bahrain

• the general absence of skills shortages identified by key stakeholders during consultations.

Nonetheless, due to the projected gradual expansion of the sector’s workforce, and the continuing convergence of the telecommunications and IT industries, there are a number of general skills areas that government and business leaders could focus on to ensure the future success of the telecommunications sector. These include:

• ICT literacy – primarily to allow for effective interaction with software linking

telecommunications devices and multi-media services

• e-business techniques – ranging from knowledge about email and VoIP to business-to-business electronic commerce

• sales and customer service.

Results from employer survey and the current skills gaps identified in the labour market analysis can be used to determine an approximate number of specific occupations required in 2012, including the future need for 120 engineers and technicians, and only a small number of administrative and sales services occupations (70 managers and 70 services and sales staff).

While demand for ‘traditional’ telecommunications skills — such as telecommunications engineers and line repairers and cable joiners — are likely to drop in the future, the development of these skills sets should not be disregarded altogether.



The willingness for Bahrainis to participate in this industry suggests that, given the imposition of suitable training regimes, both in educational institutions and in- house, that the bulk of labour requirements for this industry may be obtained from the domestic workforce. The recent policy announcement in the Second National Telecommunications Plan that the government will provide support for education and training to develop decision making and management skills will contribute to the development of the domestic workforce.

10.6 SWOT snapshot

On the basis of the analysis above, a snapshot of the strengths, weaknesses, opportunities and threats to the manufacturing sector in Bahrain has been completed (see Table 10.13). This summarised information will be used to inform action plans for a small number of sectors in Report 4.

Table 10.13 SWOT — TELECOMMUNICATIONS

STRENGTH WEAKNESS • Quality of telecommunications training provided both in-

house and externally • Strong base of medium sized companies for scale and

agglomeration effects • Favourable legislative environment

• Number of telecommunications-trained staff • Poor school-level achievement in mathematics and

science • Insufficient telecommunications-related places in university

and other training providers • Competition with Qatar and UAE for skilled labour • Competition for labour with IT and Business Services

OPPORTUNITY THREAT • Batelco presence in other Middle Eastern countr ies • Presence of global telecommunications companies in

Bahrain

• Global market for telecomm unications services, and skilled workforces

• Danger of falling behind other GCC countries in innovation and technical change


10.7 Future skills issues facing the telecommunications sector

The main problems facing the Bahrain telecommunications industry are generic to the sector across the world. Principally these are problems associated with moving from a hardware dominated ‘voice’ industry to one that is highly integrated with the ICT industry and provides a variety of voice, data and entertainment services. In this scenario connectivity is a starting point rather than an end point. In other words the main issues faced by the industry lie in coping with structural change in the nature of the industry and the implications of this for human resource management, capital budgeting and alliances.

In addition, and in common with other industry sectors in the Bahrain economy, telecommunications faces the constraint of a lack of local of vocationally trained/ work ready graduates to fill existing vacancies or to cater for new growth.



10.8



Chapter 11

Transport and logistics


The transport and logistics sector in Bahrain is well-established, supported by a modern infrastructure base. The sector is critical to Bahrain for three main reasons:

• Strong recent growth — between 2002 and 2005 the ‘transport and

communications’ sector grew by 25.6 per cent, with an average of 10.3 per cent growth per year (Global Investment House 2007b).

• Logistics is a large sector of the Bahraini economy — the total market size for

logistics is between 8 and 9 per cent of the total retail value for all manufactured and distributed goods that flow into and out of Bahrain (Tamkeen n.d.).

• Important links with other sectors — transport and logistics are integral to the

success of other sector business concepts including e-commerce, pharmaceuticals, duty free retail and downstream aluminium products (Tamkeen n.d.).

Transport

Transport and logistics infrastructure in Bahrain comprises three airports — two international airports and one military airport — three ports, one heliport, and roads.

The Bahrain International Airport, operated by the Bahrain Airport Company, is a major aviation hub in the GCC region and was recently voted second best in the area in a passenger survey. The airport also recently won the OAG-Routes airport marketing award for the Middle East and the Commonwealth of Independent States region (Civil Aviation Affairs 2008). The airport has grown significantly in terms of:

• handling greater numbers of passengers — between 2000 and 2006, passenger

throughput numbers increased from 3.8 million to 6.1 million, representing growth of 54 per cent (A-Z Group Ltd 2008). This compares positively with airports in other GCC States. For example, King Fahd International Airport of KSA experienced similar growth of 52 per cent between 2000 and 2006

• recent and future developments — two new airport lounges have recently been

constructed and plans are underway to expand the terminal building, construct an additional terminal, and build a multi-storey car park.

Bahrain has three ports owned by the General Organisation of Sea Ports. The newest — the Khalifa Bin Salman (KBS) Port — began operating at the end of 2008. The KBS Port is located 5 kilometres from the Bahrain International Airport and has 900 000 square metres of general cargo area, 23 600 square metres of warehouses and maximum depth at the quay side of 15 metres (General Organisation of Sea Ports Bahrain 2008).



The KBS Port replaced the next biggest port, Mina Sulman as the main commercial port. The Mina Sulman port has 15 berths and handles approximately 2.5 million tonnes of dry cargoes annually. The third port, Sitra, situated in the northeast of Bahrain is a smaller port that mainly caters for ‘dhows’ — cargo ships with draughts up to 5 metres.

In terms of Bahrain’s public transport capacity, bus services are provided. However, routes are limited and timetable information is difficult to access. Reflecting this, the total number of registered public transport vehicles in use declined. In 2002, there were 823 registered vehicles compared with 668 in 2006 (World Bank 2007; Central Bank of Bahrain 2009b).

In 2003, The Ministry of Transportation sought to privatise the public transport sector to maximise the efficiency and effectiveness of the service and develop the service for Bahraini residents. As such, the companies Abdullah Bin Hindi and CARS (a UAE company) commenced development of the Public Transportation service (Ministry of Transportation 2008). One innovative plan to add to the Bahraini public transport system is to develop a monorail network. The Government of Bahrain has ordered a feasibility study into the first phase of a three-phase plan. If implemented, the network would be completed by 2030 (Sambidge 2008).

Logistics

Logistics is an important sector for Bahrain, as the nation continually seeks recognition as a regional logistics hub in the context of a growing global focus on transport and logistics. This opportunity provides potential for GCC States to actively engage in this sector (Majdalani 2007). Bahrain’s new port signifies the commitment to remain a key logistics centre, as does the near completion of the Bahrain Logistics Zone (BLZ).

The BLZ will be the Gulf region’s first boutique logistics area, focusing on re- export and value-adding logistics activities. It will be a custom-free logistics ‘park’ situated in the KBS Port with 475 000 squared metres of space to be leased to companies that specialise in re-exporting and value-adding logistics (A T Kearney (UAE) Ltd). The General Organisation of Sea Ports operates and regulates the BLZ as it does for the KBS Port, aiming to ‘provide simplified, streamlined and efficient multimodal transfer of cargo’ (General Organisation of Sea Ports Bahrain 2008).

Bahrain will look to fill leases with both local and international companies whose strategic direction aligns with Bahrain’s development objectives, and sustainability standards (A T Kearney (UAE) Ltd). Demand for a position in the BLZ is apparent — already the BLZ is oversubscribed and the General Organisation of Sea Ports is taking care to ensure that prospective tenants fit specific criteria to ensure that they will bring value to the BLZ in the form of job creation.

The Bahrain International Airport is also a centre for substantive and growing logistics capacity. The Airport is a base for many major cargo and logistics agencies such as DHL, FedEx, TNT Express, Aramex and Global Logistical Services. Total cargo tonnes handled increased from 156 466 tonnes in 2001 to 320 492 tonnes in 2006, representing an increase of 104 per cent over this 5 year period (A-Z Group Ltd 2008).



Bahrain compares relatively well to the rest of the world in logistics performance. The World Bank Logistics Performance Indicator (LPI) ranks Bahrain in 36th place of 150 counties with a score of 3.15 (out of a possible 5). Within the GCC, Bahrain ranks in second place (after the United Arab Emirates, see Table 11.1). According to the LPI, Bahrain’s best performing sub-sectors were in customs and the quality of transport and IT structure for logistics. The LPI indicates that Bahrain is well placed to establish itself as a regional transport and logistics hub.

Table 11.1 GCC WORLD RANKINGS ON THE LOGISTICS PERFORMANCE INDEX AND INDICATORS

Performance indicator 1=highest

Bahrain

UAE

KSA

Kuwait

Qatar

Oman

Logistic Performance 36 20 41 44 46 48 Index

Customs 22 20 45 59 67 46

Infrastructure 27 18 38 46 55 43

International shipments 27 13 50 76 46 79

Logistics competence 59 20 51 47 43 67

Tracking and tracing rank 47 23 43 32 38 63

Domestic logistic costs 140 98 106 130 56 20

Timeliness 84 17 39 32 38 24

Source: (World Bank 2007).

Bahrain has room to improve its logistic performance despite a commendable LPI rank. The World Bank cites Bahrain as one of the oil producing countries that could improve its logistics sector (World Bank 2007). The World Bank suggests that the absence of incentives and pressure from the private sector to undertake institutional reform for trade and transport may be the reason for this. Table 11.1 shows that compared with other GCC States, Bahrain could improve most in:

• domestic logistics costs — for example, local transportation, terminal handling

and warehousing

• timeliness — the timeliness of shipments in reaching their destination

• logistics competence — the competence of the local logistics industry, for example, transport operators, customs brokers

• tracking and tracing — ability to track and trace shipments.

Future skills training could consider these areas of improvement as a means of enhancing these areas of logistics.




In the period between 2004 and 2007, 4901 jobs were created in the transport, storage and communication sectors for both Bahrainis and non-Bahrainis. Table 11.2 shows that more jobs were created for non-Bahrainis compared to Bahrainis. However, between 2005–06 and 2006–07 the number of jobs created for non- Bahrainis declined by 10 per cent whereas the number for Bahrainis increased by 33.8 per cent. Further, high paying jobs (with wages of over BD500 per month) decreased for Bahrainis and increased for non-Bahrainis from 2005–06 to 2006-07.

Table 11.2 JOB CREATION IN TRANSPORT, STORAGE AND COMMUNICATION 2004-07

Bahraini Non-Bahraini Jobs created Percentage Jobs created Percentage over

over BD500 BD500 2006-07 435 13.1% 1330 19.7%

2005-06 325 15.4% 1477 16.1%

2004-05 220 18.2% 1114 20.2%

Source: (Labour Market Regulatory Authority 2008b).

The median wage for Bahrain’s transport workers increased between 2005 and 2006. The median wage in 2006 was within the BD200 to BD249 wage bracket in 2005. In 2004, the median wage was in the BD150 to BD199 wage bracket (Labour Market Regulatory Authority 2008b). Figure 11.1 shows the proportion of transport workers in monthly wage categories. It shows that from 2004 to 2006 the proportion of workers in the BD200 to BD249 category increased substantially, from 14 per cent to 24 per cent and there were increases in the proportion of workers in most wage categories.

Figure 11.1

TRANSPORT WORKER MONTHLY WAGE BY WAGE CATEGORY — 2004-2006

Source: (Labour Market Regulatory Authority 2008b).



11.2 Transport and logistics in Bahrain

In 2007, transport and logistics contributed BD197.3 million (2.8 per cent) to GDP, an increase of 57.6 per cent from 2002. While the sector is growing, the rate of growth is slower than that of the economy as a whole (see Figure 11.2). Further, workers in the sector (11 272) made up 2.2 per cent of the total labour force in 2007, compared with 2.8 per cent in 2002.

Figure 11.2 TRANSPORT AND LOGISTICS AS A PROPORTION OF GDP AND LABOUR FORCE — 2002 TO 2007



The employer survey results show that a significant number of employees in 2008 (34.8 per cent) had completed Bachelor degree (see Figure 11.3).

Figure 11.3 QUALIFICATIONS — TRANSPORT AND LOGISTICS




Education and training with the purpose of increasing expertise in the transport and logistics sectors has been a minor focus in Bahrain. Education institutes and key industry players have both played a role in providing education and training. One particular education institution, the specialised Centre for Transport and Road Studies at the University of Bahrain conducts research surrounding transport issues as well as providing engineering programs that will give students the potential to participate in the transport and logistics sectors. In addition, stakeholders identified that the Bahrain Polytechnic will commence logistics training in the near future.

Some training is available for specific transport subsectors including the BAS Aircraft Engineering Training Centre owned by Bahrain Airport Services (BAS). Here students undertake training to qualify as fully licensed Aircraft Maintenance Engineers. The Centre also offers the opportunity for aircraft maintenance engineers and mechanics to take part in further training courses. This is the only training institute of its kind in the region (Bahrain Airport Services). More broadly, BAS is one of 7 companies assisting the Ministry of Education and the EDB to trial a new approach in linking with industry players to identify labour market gaps and opportunities.

Another particular example of how skills formation may be achieved in the transport sector is through pilot programs. Tamkeen considers that the employment challenge of low female Bahraini employment can be addressed in transport services. As such, a specific ‘Transport Initiative’ that finances and supports women is planned as a future pilot (Tamkeen).

11.4 International trends in logistics

This section of the report describes three international approaches to transport and logistics, with a focus on the labour market and education policies targeted at this sector including:

• UAE

• Singapore

• Hong Kong.

These three logistics centres have been recognised as having successfully understood the need to ‘balance brick-and-mortar projects with policies, regulations and enforcement measures’ (Dobberstein 2005). These countries are compared with Bahrain mainly in terms of their logistics, rather than transport capacity as comparing transport capabilities between different countries is difficult due to specific domestic transport needs that depend on the economy, population and geographic characteristics.

UAE

The UAE is the highest ranked GCC State on the LPI rank. The UAE is developing its logistics and transport sectors, using the following strategies:

• a focus on the education sector to increase skills in logistics

• development of transport plans for the future.



One aspect of improving the education base for the logistics sector in the UAE is the partnerships being formed between the education sector and industry. The University of Wollongong in Dubai (UOWD) has a specific role to align training courses with the strategic direction of the UAE. As such, two programs developed to skill students in the logistics area are a Masters in Science (logistics) and a Masters in Science (supply chain management) and the UOWD has discussed joint funding to establish a research centre for supply chain and logistics issues (ArabianBusiness.com Staff Writer 2007). The university also has a relationship with industry to identify and target talented students in logistics courses.

To date, the supply of logistics courses (and other similar courses) at a postgraduate level has exceeded demand. One reason for this could be the relatively recent development of the logistics industry and a lag in demand for the relevant education and training in this area. Many current senior workers in the industry were promoted from blue-collar positions by undertaking on-the-job training rather than having pursued specific qualifications (Croucher 2008). However, there are many job vacancies in logistics management in the UAE and it has been speculated that increased demand for such courses will emerge in the future (Croucher 2008).

In addition, the Abu Dhabi Emirate has launched two plans focused on improving transport to address the needs of the public and wider global community — the Abu Dhabi Department of Transport Five Year Strategic Plan (2008-2012) and the Plan Abu Dhabi 2030: Urban Structure Framework Plan. The plans are based on the policy drivers that seek to attract tourists, improve the lifestyle of Abu Dhabi citizens, improve infrastructure, consider environmental issues and increase integration among GCC States.

Singapore

Singapore ranks first in the LPI and as such, is a globally recognised logistics hub. Logistics is a significant sector in Singapore’s economy — in the second quarter of 2008, the transport and storage sector accounted for 9.1 per cent of GDP, compared to 2.8 per cent of GDP in Bahrain (Singapore Department of Statistics 2008). In Singapore, logistics makes an economic contribution in its own right and also plays a key role in supporting other sectors such as manufacturing and distribution. Two important factors of Singapore’s success are:

• the link between ICT and logistics sectors which has enhanced logistic

performance

• Singapore’s status as global leader on logistics issues, research and education.

A strong ICT sector has allowed Singapore to handle record levels of containerised cargo and continue to attract multi-national corporations to use Singapore as a manufacturing and distribution hub. The Singapore Government has recognised the importance of ICT in logistics performance — in 2004, S$50 million over 5 years was invested to develop an IT platform to better serve the trade and logistics community (Yang 2004). An IT platform may bring Singapore long-term cost savings of over SD$700 million and create additional value of nearly S$4 billion over a 20 year period (Yang 2004).



As well as being forefront in logistics performance, Singapore provides global leadership on logistics issues, research and education. The Logistics Institute Asia- Pacific (TLI-AP), established in 1998, is a collaboration between the National University of Singapore and the Georgia Institute of Technology. TLI-AP is a renowned body for education and research in global logistics, offering four main logistics research postgraduate programs. Its presence strengthens Singapore’s position as leader in this field.

Hong Kong

In addition to the UAE and Singapore, Hong Kong has a high performing logistics sector that achieved a rank of 8 in the LPI. Logistics contributed 5.2 per cent to the Hong Kong economy in 2005 (Hong Kong Logistics Development Council 2007) and combined with trade, contributed 27 per cent of value-added contribution to GDP in 2006 (Hong Kong Special Administrative Region Government 2007). In 2001, Hong Kong established the Hong Kong Logistic Development Council (LOGSCOUNCIL) in recognition of their dependence on logistics as a pillar of the economy (Hong Kong Logistics Development Council 2007). LOGSCOUNCIL lists several factors as contributing to Hong Kong’s success as a logistics hub including:

• an ideal location as a gateway to the world’s largest trading partner, China

• a strong repository of knowledge and expertise

• excellent logistics facilities

• a free economy (Hong Kong Logistics Development Council 2007).

To maintain successful performance of the sector, LOGSCOUNCIL will continue to develop and improve a well-trained workforce, which is recognised as key to industry success. A group within LOGSCOUNCIL has a specific focus on developing the logistics workforce. The group communicates with education agencies to translate supply chain, trading, transportation and warehousing skills needs into human resource requirements (Hong Kong Logistics Development Council 2007). Workshops and demonstrations in conjunction with the Hong Kong Productivity Council are undertaken to develop workers skills and knowledge in the sector.

Similar to the UAE, Singapore and Hong Kong, Bahrain is situated in an ideal location and has a good reputation as a liberal economy, which makes it easy for investors to conduct business. To increase global performance in logistics, Bahrain needs to increase the linkages between the logistics sector and other related sectors, such as manufacturing, ICT and tourism and expand the education and training in this area. Education and training is key to increasing skills formation in the transport and logistics sector, which is reinforced by the experiences in the international logistics hubs described previously. Currently this is the main area to develop in the context of Bahrain’s aim to become a regional leader in logistics.




This next section discusses the future labour and skills needs of Bahrain’s transport and logistics sector with reference to labour market and qualifications analysis, key stakeholder consultation, and surveys of employees and employers. These findings discern potential problems that may affect the performance of the sector and cover possible solutions.


In Bahrain, general employment trends in the transport and logistics sector show an increase in employment between 2002 and 2008. As Figure 11.4 shows, male employment exceeded female employment for the 6-year period and grew at a faster rate than female employment. Non-Bahraini males dominated employment in the sector and experienced the largest employment growth rate. Prior to October 2004, Bahraini males were the dominant demographic groups employed in the transport and logistics sector — from 2002 to October 2004 this demographic group comprised on average, 46.9 per cent of total sector employment. After October 2004, non-Bahraini males were the dominant demographic group employed in the sector. In December 2007 this group had 5976 employees, comprising 53.0 per cent of the employees in the transport and logistics sector.

Further, stakeholders identified that female employees in the transport and logistics sector were mostly involved in administrative occupations.

Figure 11.4 TRANSPORT AND LOGISTICS — 2002 TO 2007


Projections for future employment in the transport and logistics sector show that the number of jobs in 2012 will have increased by 67 per cent compared with the number of jobs in 2007 from 11 272 jobs to 18 789 jobs (see Figure 11.5). However, employment for non-Bahrainis will grow by 104.2 per cent, from 7 136 to 14 571 jobs compared with only 2.1 per cent for Bahraini nationals, from 4 136 jobs to 4 224 jobs.



Figure 11.5 EMPLOYMENT PROJECTIONS, TRANSPORT AND LOGISTICS, 2008 TO 2012



Forecast qualifications in the transport and logistics sector between 2008 and 2012 are expected to be for employees to have completed secondary school (48 per cent of the gap, equal to 3 606 jobs) and for employees with a diploma qualification (21.1 per cent of the gap, equal to 1 589 jobs). However, the survey results show that there may be an increased need for people with a Bachelor degree or diploma qualification, rather than secondary school education in the future.


Employee survey

Transport and logistics sector employees made up 4.7 per cent of total employee survey responses. The majority of transport and logistics employees described their occupation as ‘services and sales’ (25 per cent). The next highest proportion of employees described their occupation as an engineer or technician. Figure 11.6 displays how surveyed transport and logistics employees described their occupation.

Figure 11.6





In addition, survey respondents highlighted attitudinal characteristics that they found influential in a job (see Figure 11.7). Respondents from the transport and logistics sector found that remuneration was very highly influential (4.03 out of 5), as was the work environment (3.97 out of 5) and work-life balance (3.8 out of 5).

Figure 11.7 ATTITUDES ABOUT WORK — TRANSPORT AND LOGISTICS


Employer survey

The employer survey comprised 26 organisations from the transport and logistics sector, representing 3.2 per cent of the total survey sample. These responses represent 7 161 employees or approximately 63.5 per cent of the transport and logistics labour market. Of the survey responses, around 35 per cent of employees were Bahraini and 65 per cent non-Bahraini, which shows the high level of non- Bahraini employment in the sector. Further, around 70 per cent of employees in the sector were male.

Surveyed employers grouped employees in their organisation by position and demographic group. Positions held within the transport and logistics sector differed according to gender and nationality. Table 11.3 shows transport and logistics sector positions by demographic group. Surveyed employer responses indicate that non- Bahrainis were more likely to be in construction occupations related to the transport and logistics sector than Bahrainis, females were more likely to work in administrative services than male employees.



Table 11.3 HIGH-LEVEL OCCUPATIONS — TRANSPORT AND LOGISTICS SECTOR

High-level category



Engineers and engineering technicians 9% 8% 9% 7%






Total 100% 100% 100% 100%


Considering these occupations further, when asked to provide information on occupations at more detailed level (second-tier level), employers identified most employees in the sector as civil and service engineers (20 per cent), stationary engine operators (16 per cent) and architect technicians and administrative clerical workers (12 per cent) (see Table 11.4).

Table 11.4

SECOND-TIER OCCUPATIONS — TRANSPORT AND LOGISTICS

Second-tier occupation Proportion of total

sector responses

Civil & survey engineers 20%

Stationary engine operators 16%


Supervisors of sections 8%


Consumer goods salesmen 4%

Other 3%

Salesmen 3%


Transport, road vehicle & agricultural equipment repair 2%

Mechanical equipment & instrument assembly 1%

Transport & road vehicle driving occupations 1%

Secretaries 1%

Heads of sections 1%

Equipment & instruments assembly occupations 1%

Industrial managers 1%




In addition to the occupations listed in the table above, respondents identified a large number of other occupations present in the transport and logistics sector including, administrative managers, professionals in systems analysis, administrative specialists and chemical engineering technicians.

Table 6.8 shows an indicative forecast to 2012 of second-tier occupations that apply to the transport and logistics sector. The indicative forecast is based on the following method:

• initial results were drawn from the employer survey at the second-tier level

(up to 117 occupation categories). 77 per cent of transport and logistics employers who participated in the survey responded to the second-tier related questions

• for the transport and logistics sector, the key second-tier occupation categories

were compared to relevant ILO statistics for the United Kingdom in 2007 as a proxy (and in some cases compared to Bureau of Labour Statistics data in the United States for 2008) to provide a benchmark to validate the forecast. A benchmark was unavailable drawn from Bahrain or any other GCC State (Bureau of Labor Statistics 2006)


transport and logistics sector and the outcomes of the stakeholder consultations undertaken as part of the Skills Gaps Research Study

• the key limitations for the results in the transport and logistics sector are that

the respondents to the second-tier occupation categories were 77 per cent of the total sector responses.




Table 11.5

SECOND-TIER OCCUPATIONS (INDICATIVE FORECAST 2012) — TRANPORT AND LOGISTICS

Second-tier occupation Indicative forecast 2012

Proportion of total forecast

occupation gap

Transport and road vehicle driving occupations Inc ludes: • airport services occupations • airline cabin crew occupations • pilots

Engineers and engineering technicians Inc ludes: • civil and survey engineers • mechanical engineers • electronics engineers • industrial engineers • engineering technicians

1 840 26% 1 100 16%

Administrative clerical workers 1 100 16%

Supervisors of sections Inc ludes: • heads of sections

580 8%

Stationary engine operators 460 7%

Private sector section heads 500 7%

Other Includes: • logistics and freight occupations • ship captains • professionals in flying and navigation • sea navigation technicians

Salesm en Inc ludes: • consumer goods salesmen

Private sector managers Inc ludes: • Industrial m anagers

Transport, road vehicle and agricultural equipment repair

Mechanical equipment and instrument assembly

340 5% 290 4% 290 4% 200 3% 230 3%

Secretaries 100 1%

Total indicative occupation gap in 2012 7 030 100%




Transport and logistics sector respondents also identified the top five skills required in the sector, which are outlined in Table 11.6. The most commonly identified skill required in the transport and logistics sector were communications skills (21 per cent of total responses), followed by English language skills (11 per cent).

Table 11.6 TOP 5 SKILLS — TRANSPORT AND LOGISTICS


Communication Skills 21% English language skills 11% IT skills 7% Physical skills 7% Sales and marketing skills 7% Work ethics 7% Customer service skills 7%


As Figure 6.7 highlights, the occupational groups that have the highest average monthly wages are managers and business executives and engineers and engineer technicians. Construction occupations and scientists and science technicians, in contrast, have the lowest.

Figure 11.8

AVERAGE MONTHLY WAGE (BD) BY OCCUPATION GROUP — TRANSPORT AND LOGISTICS


Respondents also noted the change in quality of recruits in the transport and logistics sector by nationality compared with two years ago. Figure 11.9 shows that neither Bahraini nor non-Bahraini recruits were of lower quality than two years ago. Overall, however, non-Bahraini recruits had improved marginally more than Bahraini recruits in terms of quality:



• for combined technical and generic skills, while 35 per cent of employers agreed that Bahraini recruits improved in this area, 42 per cent found that the quality of non-Bahraini employees had improved over the period. This could be because the calibre of skills that recent non-Bahraini immigrants possess is better than in the past

• respondents identified that 23 per cent of Bahraini employees showed no

difference in their skills, whereas only 15 per cent of non-Bahraini employees were identified as having no difference in their skills set compared to two years ago.

Figure 11.9

CHANGE IN QUALITY OF RECRUITS IN TWO YEARS


Employers also rated the importance of work related skills in the transport and logistics on the scale ranging from not important to very highly important. In the transport and logistics sector, physical skills, literacy skills and customer communication skills were the most important skills, rated as very highly important by respondents. Figure 11.10 displays the importance of skills relative to one another in the transport and logistics sector.

Figure 11.10

IMPORTANCE OF WORK RELATED SKILLS





Stakeholders from the transport and logistics sectors identified a number of areas where skills gaps were present — including call centre skills, skilled cabin crew, airport services skills, freight and logistics skills, and customer services and sales skills.

All stakeholders that were interviewed as part of the Skills Gaps Research Study noted that there were very limited training opportunities for the transport and logistics sector — this applied to both vocational and higher education training. For example, many cabin crew are trained in either Jordan or Oman because training facilities in Bahrain are not extensive. However, one stakeholder noted that there were currently three programs running with Tamkeen to improve skills in the transport and logistics sector, including a career progression program and a call centre training program for around 140 individuals. Interestingly, prior to the call centre program, all training in this field had to be conducted outside of Bahrain (for example, in Oman). As mentioned above, stakeholders identified that the Bahrain Polytechnic will soon commence logistics training courses.

The skills of the current transport and logistics workforce were a major concern for stakeholders. One stakeholder noted that existing workers at the Bahrain International Airport require additional training to meet international standards and that the Airport is significantly understaffed so training will also be required for new recruits. Further, the demands on skills in the sector will be challenged as expected growth in the tourism sector prevails and significant increases to logistics infrastructure (such as the BLZ and the cargo facility planned for the Bahrain International Airport) are completed in the coming years.

Generic skills were also raised by a number of stakeholders. One stakeholder in the sector recently undertook a staff engagement survey, finding that there was a significant issue with staff willingness to work and engagement. It was found that engagement was worse for Bahraini employees than for non-Bahrainis.

Finally, stakeholders identified that employee perceptions of working in the transport and logistics sector need to be changed. One view is that currently there is a focus on Bahraini employees only accepting managerial positions in the sector, but the demand in for employees is for operators. This mismatch will need to be addressed in the future.


Skills gaps in the transport and logistics sector are significant given the discussion above. Currently, skills gaps in the transport and logistics sector fall into the following three categories:

• logistics and freight skills

• airport services skills

• airline cabin crew skills.

Results from the employer survey and the current skills gaps identified in the labour market analysis can be used to determine an approximate number of specific occupations required in 2012, including the future need for approximately 7 400 positions:



• 6 600 general transport and logistics positions

• 800 engineers and technicians


• 330 managers.

Logistics competence was a key issue for success in the sector for Bahrain identified by the World Bank. Future improvements in logistics and freight skills will be important to increase competence in this area of the sector. For example, as seen in the nations included in the international trends sections, higher-level skills and qualifications are required in logistics as the sector increases and contributes more to GDP. The results of the employee survey are in line with this trend, estimating an increased need for employees with a Diploma or Bachelor qualification (approximately 1 833 jobs in 2012) in the future.

Further, airport services skills will be required as the Bahrain International Airport continues to grow and improve facilities, infrastructure, and in turn, activity (as discussed above). Specific skills include customer service and sales skills, engineering and maintenance skills (up to 360 positions required in 2012) and emotional (attitudinal) skills as highlighted in the employer survey results.

Airline cabin crew skills (including pilots) will also be required in the future as Bahrain increases its connectivity within the GCC and MENA regions and beyond. For example, in addition to Gulf Air (who have introduced 2 new routes in 2008 and aims to expand from its current 43 destinations to 60 by 2013) (Bonnassis 2008), Bahrain Air plans to significantly increase the number of destinations over the next three years. In addition to cabin crew skills, call centre skills for airlines, and emotional (attitudinal) skills will also be important to fill current and future gaps in the transport and logistics sector.

The key skills gaps identified for the transport and logistics sector are summarised in Table 11.7, including the sources from where the skills gaps have been highlighted.

Table 11.7 SKILLS GAPS SUMMARY — TRANSPORT AND LOGISTICS SECTOR

Study input Logistics and freight skills

Airport services skills

Airline cabin crew skills

Labour market analysis û û û Qualifications analysis û û û Survey of employers ü û û Survey of employees û û û Survey of graduates û û û Survey of Education Institutes û û û Key stakeholder consultations ü ü ü

Other information sources ü û ü




11.7 SWOT snapshot

On the basis of the analysis above, a snapshot of the strengths, weaknesses, opportunities and threats to the transport and logistics sector in Bahrain has been completed (see Table 11.8). This summarised information will be used to inform action plans for a small number of sectors in Report 4.

Table 11.8 TRANSPORT AND LOGISTICS — SWOT

STRENGTH WEAKNESS • Strong growth in the transport and communications sector • Development of the Bahrain Logistics Zone and a third

port to increase Bahrain’s capacity and labour need in the logistics sector

• A desirable geographic position to develop as a transport and logistics hub.

• Limited educational and training opportunities in the transport and logistics areas

• Comparatively low ratings in domestic logistics costs, timeliness of shipments, logistics competence and tracing and tracking abilit ies

• Women are mainly employed in secretarial roles in this sector

• An elementary public transport system. OPPORTUNITY THREAT

• Pilot programs such as the ‘Transport Initiative’ encouraging women to participate in the transport and logistics sector

• Developing more education opportunities specific to transport and logistics in Bahraini universities

• Increasing linkages between the education sector and industry to ensure that specialist training is available to employees.

• Maintaining international competitiveness in the light of the recent decrease in Bahraini employees in the sector and its position near larger neighbours

• New jobs being filled by non-Bahrainis and a continuing decrease in the number of Bahrainis working in the sector

• Employees seeing greater improvement in the quality of non-Bahraini recruits compared to Bahraini recruits in the last 2 years.



The Bahrain transport and logistics sector has performed well over the last decade with high international ratings and several large scale projects aimed to further develop and improve its regional and international status. There are, however, some areas that can be improved to enhance its performance that could emerge as issues in the future. These areas are:

• slow Bahraini employment growth

• an under utilised female workforce

• maintaining international competitiveness

• public transport.

Slow employment growth of Bahraini nationals in this sector is a significant problem and the labour market analysis shows no growth in Bahraini employment to 2012 against growth in the number of non-Bahraini employees. In the context of the government’s Bahrainisation policy this trend is problematic if the status quo were to continue.



In addition, low female employment is a concern for skills development in Bahrain. While the survey shows some females are civil and survey engineers, the majority of females in this sector work in secretarial roles and women do not work in the managerial positions. Given the pool of young Bahraini women that could potentially participate in the labour force, restricting and under-utilising the female workforce could be a significant human resources issue in the future.

Bahrain is promoting itself as a logistics hub in its region and is not alone in this goal. Many nations of similar geographic characteristics to Bahrain are striving towards this recognition (for example, the UAE, Sri Lanka and the Philippines) as well as larger countries such as India (Mumbai specifically). As such, the shortage of workers and skills in the Bahraini national group may have implications for maintaining this status in the region. One surveyed employer noted that logistics managers in Bahrain were positions that were hard to fill. Bahrain is a small nation geographically and in terms of population within the GCC, hence its larger neighbours may be potential competitors as a logistics hub.

Further, the infrastructure in the sector, including the KBS Port, BLZ and expansions to the Bahrain International Airport mean that any current skills gaps in the sector will be further emphasised in the next few years as these project build up to full capacity.

In addition, the Ministry of Transport in Bahrain has stated that it is aiming to raise the efficiency and effectiveness of the public transport system in Bahrain. This goal has been acted upon through a privatisation process. However, Bahrain’s public transport system is limited and information on services is difficult to access. To ensure that this goal is being met, the Government would need to monitor the future performance of the system and may consider further improvements to public transport services in Bahrain.



Part D

Sectoral and skills gaps analysis — trade and other services



Chapter 12

Business services


The Business Services Sector describes service providers that are designed to cater for the needs of other businesses. For this reason, the long term future of the sector is closely linked to the overall performance of the economy. Specifically, the sector includes:

• legal services

• real estate services

• accounting services

• marketing and promotion services.

Real estate and the buoyant property market that has characterised Bahrain in recent years drives the majority of GDP currently generated by the business services sector. However, structural change within the sector may be slowly occurring. Between 2002 and 2006 the percentage share of GDP generated by business services other than real estate has grown from 14 to 17 per cent (see Figure 12.1).

Figure 12.1

GROWTH IN NON-REAL ESTATE RELATED BUSINESS SERVICES

Source: (Central Informatics Organization 2007).

Given the relatively amorphous nature of the industry, exact data on the structure and composition of the business services sector is proving problematic to obtain. One current source of such data is the Bahrain Yellow Pages. A data search of this site reveals that currently operating in Bahrain there are:

• 140 listings for real estate agents

• 93 listings for lawyers, including seven that specialise in corporate and

commercial banking law

• 21 listings for accountants and auditors

• 9 listings for marketing agents.



It is not possible to determine the distribution of employment within and across these areas because such disaggregated data does not exist. However, it is reasonable to assume that the large majority of business services sector employees are real estate agents. This being the case it also suggests that formal education levels in the sector may not be comparable to other sectors in the economy and may be biased towards vocational and certificate level qualifications rather than higher tertiary level qualifications. An example of this is the Real Estate Certified Practitioner’s Training Course that commenced in 2008 and is conducted by the Dubai Real Estate Institute (DREI).

12.2 Business services in Bahrain

In 2007 the contribution of the business services sector to GDP was BD516.12 million. The sector grew by 13 per cent over the period 2002-2007 but declined in terms of its relative contribution to the Bahraini economy from 9.73 per cent of total GDP (2002) to 7.44 per cent (2007) because the economy as a whole grew by 23 per cent. This relative performance is shown in Figure 12.2 using data supplied by the (Central Informatics Organization 2007).

According to official data from GOSI, the business services sector currently employs approximately 2800 people. This represents less than 1 per cent of Bahrain’s workforce. However, this is likely to be an understatement of the true size of the workforce due to the presence of part-time and casual workers in the sector whose work levels are often under-reported or not reported at all within official statistics. Growth in employment in the sector has been strong. Between 2002 and 2007 the number of employees as a percentage of the overall workforce has doubled.

Figure 12.2

BUSINESS SERVICES AS A PROPORTION OF GDP AND LABOUR FORCE — 2002 TO 2007


The business services sector is dominated by a non-Bahraini workforce, which in recent years has become more pronounced. Between October 2003 and December 2007 Bahraini employees as a proportion of the total employees in the business services sector dropped from 38 per cent to 30 per cent (refer to Figure 12.3).



Further, the majority of employees in the business services sector are male. However, the percentage of female employees has grown from 7 to 11 per cent in the last five years. The sector seems to offer a natural place for increased female participation, particularly if structural change occurs and the emphasis on real estate is reduced.

Figure 12.3

LABOUR MARKET IN THE BUSINESS SERVICES SECTOR

Source: (Allen Consulting Group and Eidos); (General Organization for Social Insurance (GOSI) 2008).


The average wage in the business services sector in 2004 was BD372 per month. This is significantly above the minimum wage guidelines set in 2004 of BD150 per month for employees in both the private and public sector (Foundation 2004). Within the sector, Bahraini wages are on average, only marginally lower than the overall average wage, suggesting that non-Bahraini workers are not able to demand a premium for their services (refer to Table 12.1) and identifying the sector as a likely source for increased Bahraini participation.

Table 12.1 AVERAGE WAGES IN THE BUSINESS SERVICES SECTOR 2003-04

Year Average Wages Bahraini Wages % of Average 2003 345 340 98.6 2004 373 371 99.4

Source: (Foundation 2004).


Overall, employees in the business services sector tend to have completed less years of formal education than the labour force in aggregate. For example, 29 per cent of employees in the business services sector have tertiary qualifications (i.e. Diploma or above) in comparison with 34 per cent of the total labour market (refer to Figure 12.4). Employee surveys reveal that 13 per cent had post-graduate qualifications.



Figure 12.4 EDUCATIONAL LEVELS FOR THE BUSINESS SECTORS


This below average distribution in formal education is likely to be linked to the dominance of the real estate industry within this sector. Currently, there is no requirement for any form of training in order to operate as a licensed real estate agent in Bahrain. Box 12.1 outlines the requirements that must be satisfied in order to be issued with a real estate brokering licence.

Box 12.1 REAL ESTATE LICENSING REQUIREMENTS

• to be a Bahraini citizen residing in Bahrain • to be no less than 21 years of age • to be fully competent and of good repute and conduct • final court judgment should not have been passed against him in a felony or

misdemeanour affecting his honour, integrity or public morals, unless he has since been reinstated

• to be literate • a bank guarantee in the amount of BD300 in favour of the Ministry of Justice is

required.

Source: (Ministry of Industry and Commerce 2008).

Skills formation for business services outside of real estate is far more likely to require tertiary education. At present, the University of Bahrain’s College of Business Administration offers:

• a Bachelor of Science in Marketing

• a Bachelor of Science in Accounting.

The University of Bahrain’s Law Department offers:

• Bachelor of Law and Bachelor of Legal Studies.



In addition the:

• Gulf University offers bachelor, masters and PhD level degrees in law, accounting and finance, and marketing

• Bahrain Training Institute also offers level three courses in bookkeeping and

sales and marketing and a level four course in advanced business administration.

Feedback from consultations with accounting firms indicated that employers noted that when given the opportunity they would hire Bahraini graduates but that the current accounting graduate numbers were insufficient to meet the demand.

12.4 International trends in business services

Three international trends are likely to impact on the demand for some types of business services. These are:

• the emergence and likely growth of banking and insurance services that adhere

to Islamic law

• the continued diversification of GGC country economies away from oil based economies

• the emergence of a global market for business services due to advances in

information and communications technology (ICT).

Islamic banking and insurance

There has been a well-documented rise in popularity of banking and insurance services that adhere to Islamic law. The World Islamic Banking Competitiveness Report 2007 predicts that the value of assets managed by Islamic banks will grow 33 per cent to $1 trillion by 2010. Further, it is estimated that Islamic banks will account for 40 to 50 per cent of total savings of Muslims in five to seven years. As these industries grow and become more ubiquitous, it is foreseeable that they will drive concurrent growth in demand for specialised business services to support these industries. Principally, for the business services sector, this is likely to result in the demand for specialised legal and accounting services.

Diversification of GCC countries

The continued move away from dependence on oil in GCC country economies has and will continue to result in a rise in the demand for specialist labour in a variety of areas, particularly if the diversification process is driven by an aggressive off shore investment program to recycle accumulated receipts from oil. Within the diversification process, human capital will be just as important to successful implementation as financial capital. Business services, with its mixture of legal and commercial applications are becoming a key sector in the diversification push. For example, it will provide:

• the investment analyst

• international and intellectual property lawyers

• para-professionals required in managing large-scale overseas investments.



International investment in GCC countries is currently hindered by the lack of intellectual property law. It is foreseen that property law is likely to be introduced into the regulatory framework for all GCC countries as part of the drive to diversify and attract investment (Fascano 2003). Specialist legal services (both those that can navigate the application process and those that can assess the validity of applications for patent or trade mark production) are likely to be in high demand.

The diversification process will also result in a higher demand for marketing professionals as a new set of exportable activities is generated to supplement oil exports.

Information and communication technologies advances

A new and burgeoning trade in exportable business services is emerging worldwide (Fascano 2003). Some business services, such as accounting, lend themselves to this model. This trend presents both threats and opportunities. It is likely that in the coming decades will see further growth in the practice of outsource services to more economical providers. This trend has, and will continue to, emphasise the importance of e-literate business service staff. Exportable business services will also drive the improvement of the technical and vocational competence of paraprofessional staff.

Challenges in the sector

Maintaining and developing employment and investment in this sector presents several challenges. These challenges are outlined below:

• the sector’s dependence on other businesses to supply demand means it is

potentially highly exposed to any deterioration in external economic conditions, such as those being currently experienced

• historically, growth in the business services sector has been strongly correlated

with the real estate boom. The localised nature of this industry means that growth in this sector is finite. Structural change is required in order for sustained growth to be possible.


There is a significant occupational cross over between the business services sector and the other industries in a modern economy. For example, crossovers occur with advertising, accounting, business communications, human resources, management services, applied legal services, market research and franchising and property management. As a result, the business services sector is competing in that broad range of skills which are also in demand in ICT, public administration and other parts of the service sector and which, broadly speaking, are driven by e-technology and advanced clerical skills.



At the professional and managerial level, the business services sector will require resource managers, engineering process managers, accountants and sales and marketing executives. These all require university training, for which the University of Bahrain is currently not well suited. However, the bulk of labour needs (approximately 70 per cent) will still come from the paraprofessional, technical and administrative level skills which are normally associated with vocational educational training. These include, finance associate professionals, miscellaneous business and administration, miscellaneous advanced clerical, clerical, keyboard operators, receptionists and numerical clerks.

The vocational/technical forms of employment in this sector are particularly relevant in the area of legal services including: legal assistant, legal secretary and paralegal. The key skills required here are transferable across the entire business services sector. For example a contemporary Diploma of Business (Legal Studies) would include instruction in:

• computing, including: word processing, spread-sheeting, producing business

documents, presentation graphics and spreadsheets, using internet/email

• communication, including: workplace communication and applied business communication

• operations, including: the business environment, using business equipment and

handling mail.

As well as specific legal studies areas such as:

• legal terminology

• introduction to the legal system

• recording of time and costs

• management of legal files and information

• preparation of legal documents

• legal research and reporting

• court preparation and procedure

• legal studies (paralegal studies)

• contracts, conveyance and leases.

In many countries now polytechnic/universities, such as Kwantlen Polytechnic in British Columbia have emerged, aimed at offering post-school training for early school leavers or mature students and also a pathway to full tertiary training. The rise of these institutions is indicative of the applied and vocational needs of employers in business services areas and the difficulty traditional universities have in servicing industries with high levels of need for sub-degree level trained staff and further emphasise the need for a fully articulated polytechnic in Bahrain, as has recently been established.



Technology has been the single most important driver of the change in labour force requirements within business services (DEIR, 2007). Digital technologies, online transactions and convergence will place demands, not just upon future staffing levels but more importantly upon existing staff. In Western economies, over 95 per cent of firms within the business services sector employ moderate to heavy use of the internet, and for firms of a 100 employees or more, the figure was 100 per cent.

The new business models spawned by e-business strategies provide different ways of thinking about market places, interacting with customers and managing staff resources. As a result, the following technology trends listed below, are expected to have significant impact upon the innovation and business industries:

• voice over internet protocol

• mobility

• security

• web services

• niche outsourcing

• data mining

• fast broadband.

In some respects, Bahrain is relatively well placed to deal with some of these trends. The Global Information Technology Report ranked Bahrain in the top one third (out of 127 countries) in terms of network readiness (45th), technical readiness (39th), internet users (47th), e-participation index (42nd) and possession of personal computers (41st) (INSEAD 2008). The difficulty comes in labour force competition from other sectors and the provision of sufficient training at the post school/ vocational education and training level. Fortunately, the predicted growth rate within the Public service, a major competitor for labour with business services, is slowing, growing by only 2 per cent over the decade 1992-2002 (Ali 2006).

By contrast, total employment in business services in Bahrain is predicted, by the labour market analysis contained in this study to double over the period 2007-2012, from 2 822 persons to 5 757 persons. Projections for future employment in the business services sector show that the number of jobs in 2012 will have increased to 5757 (a 100 per cent increase compared to the number of jobs in 2007). Employment for Bahrainis and non-Bahrainis will grow at similar rates (see Figure 12.5).



Figure 12.5 BUSINESS SERVICES — 2008 TO 2012

Source: (Allen Consulting Group and Eidos); (Labour Market Regulatory Authority 2008b).

It is important to note that the predictions in Figure 12.5 are based upon a continuance of growth within the Bahrain economy.

Employer and employee survey results

Employer survey

The employer survey received 67 responses from organisations operating in the business services sector. The 5 131 employees encompassed by the survey’s respondents comprised 181.8 per cent of total employees within the sector and 7.7 per cent of total surveyed employers. The survey sample shows there was a higher response in the business services sector than the proportion of the labour market in 2007, reflecting the high proportion (7.7 per cent compared to 0.8 per cent) and perhaps the labour market numbers (however, this cannot be confirmed).

Of the employees covered by the responses 70.7 per cent were non-Bahraini and males dominated females in the sector, with 89.7 per cent of surveyed employers capturing male employees.

The composition of the business services sector is such that services and sales people followed by business professionals are the two largest first tier job categories. Table 9.7 shows first tier job categories by demographic group.



Table 12.2 HIGH-LEVEL OCCUPATIONAL GROUPS — BUSINESS SERVICES

High-level categories

Bahraini

males

Bahraini females

Non- Bahraini

males










Total 100% 100% 100% 100%


Non-Bahraini men are the largest demographic group within the business services sector and are mainly involved in services and sales people positions followed by other occupations and then managerial and business executive positions. The second largest group in the sector are Bahraini males who are predominantly services and sales people.

When asked to provide information on occupations at more detailed level (second- tier level), employers identified most employees in the sector as administrative managers (29 per cent), electronics technicians (22 per cent) and consumer goods salesmen (9 per cent). Table 12.3 shows the second tier occupation groups by proportion of employees.



Table 12.3

SECOND TIER OCCUPATIONAL GROUPS — BUSINESS SERVICES

Second Tier Occupation Proportion of total sector responses

Salesmen 19%

Other 8%


Gas & oil cookers & heater maintenance 7%

Building construction occupations 6%

Administrative specialists 5%

Industrial managers 5%



Professionals in financial science 4%

Tourism managers 2%

Other managers 2%


Secretaries 2%

Professionals in law 1%

Manpower specialists 1%


In addition to the occupations listed in the table above, respondents identified a large number of other occupations present in the business services sector including transport and road vehicle drivers, working proprietors, commercial managers, professionals in economic and insurance, engineering technicians, accounting technicians and information systems technicians.

Table 6.8 shows an indicative forecast to 2012 of second-tier occupations that apply to the business services sector. The indicative forecast is based on the following method:


to 117 occupation categories). 36 per cent of business services employers who participated in the survey responded to the second-tier related questions

• for the business services sector, the key second-tier occupation categories were

compared to relevant ILO statistics for the United Kingdom in 2007 as a proxy to provide a benchmark to validate the forecast. A benchmark was unavailable drawn from Bahrain or any other GCC State (International Labour Organization 2007).


business services sector and the outcomes of the stakeholder consultations undertaken as part of the Skills Gaps Research Study



• the key limitations for the results in the business services sector are that the respondents to the second-tier occupation categories were 36 per cent of the total sector responses.


Table 12.4

SECOND-TIER OCCUPATIONS (INDICATIVE FORECAST 2012) — BUSINESS SERVICES

Indicative Proportion of Second-tier occupation forecast 2012 total forecast

occupation gap Professionals

Inc ludes: • professionals in law • professionals in accounting • professionals in economics • human resources • advertising, media writers and planners • architect engineers Other Inc ludes: • accounting technicians • information systems technicians • architect technicians • legal clerks • accounting and finance clerks

720

400 15%

Private sector section heads Administrative specialists Industrial m anagers

370 13%

230 8%

230 8% Private sector managers

Inc ludes: • tourism managers • other managers • administrative managers

230 8%

200 7% Administrative clerical workers Inc ludes: • secretaries

Salesm en Professionals in financial science Gas & oil cookers & heater maintenance Building construction occupations Total indicative occupation gap in 2012

180 6%

180 6%

70 2%

60 2%

2870 100%




The main group of employees in the survey, services and sales people, earn on average, higher wages than those employees in the same job in another sector (BD317 compared to BD243 in other sectors). Employees in ‘other’ occupations and business professionals also tend to earn a higher average wage than those in the same positions across other sectors (BD334 compared to BD262 for administrative service positions and BD1170 compared to BD647 for all other occupations). The average monthly wages for the top three occupational groups in the private education sector are represented graphically in Figure 12.6.

Figure 12.6

A WAGE COMPARISON — BUSINESS SERVICES COMPARED TO ALL SECTORS


The survey collected data on the prevalence of skills shortages and the quantity and quality of training activity. Business service employers did not recruit extra staff mainly because they were happy with their staff levels. However, almost one third of business employees felt that there was a shortage of good candidates and a difficulty in attracting good candidates to the organisation. Table 12.5 provides detail on the reasons given for not employing additional staff for the business services sector.

Table 12.5

CONSTRAINTS ON EMPLOYERS OF HIRING MORE STAFF

Reason for not hiring staff Per cent reporting yes Lack of financial resources 20.9 Shortage of good candidates 29.9 Difficulty attracting good candidates 29.9 Difficulty attracting good candidates to location 16.4 Happy with number of staff employed 52.2


Following this, 29.9 per cent of business service employers found it more difficult to recruit good quality staff than before with 14.9 per cent finding that it is easier to recruit good quality staff.



Over one-third (35.8 per cent) of business services employers indicated that Bahraini recruits had higher standards in technical and generic skills than two years earlier with 4.5 per cent of employers finding that current recruits had lower standards in terms of technical and generic skills than two years ago. Fewer employees responded that non-Bahraini recruits were of higher standards in these skills with 26.9 per cent agreeing with this statement.

Business services employers reported they provided a range of training over the previous 12 months; 56.7 per cent reported providing induction training and 46.3 per cent reported providing administration and 43.3 per cent of employers provided technical training. Furthermore, 52.2 per cent of respondents indicated that they provided some kind of in-house training, while 29.9 per cent sourced training externally from within Bahrain and 22.4 per cent sourced training from an overseas provider.

When recruiting in the business services sector employers are attracted primarily by literacy skills. Work communication skills are also highly valued as are customer communication skills. In contrast, a low priority is given to physical skills. Figure 12.7 shows the importance of work related skills to employers in the business services sector.



Business services employers also identified the top five skills required in the sector, which are outlined in Table 11.6. The most commonly identified skill required in the ICT sector was communication skills (17 per cent of total responses), followed by IT skills (8 per cent).



Table 12.6 TOP FIVE SKILLS — BUSINESS SERVICES


Communication Skills 17% IT skills 8% Technical skills 7% Customer communication skills 8% English language skills 4%


The business sector is looking to grow substantially in the next five years, by 6 325 jobs. Most of these are for manager and business executive positions followed by administrative services. Figure 12.8 shows what areas new positions are intended for.

Figure 12.8

NEW POSITIONS FOR THE NEXT FIVE YEARS


Employee survey

The employee survey received 175 responses from employees in the business services sector out of a total of 975 responses. The majority (61 per cent) of the business services employees that responded were citizens of Bahrain.

Of the employee survey responses, 17.9 per cent worked in the business services sector. Of these employees and 28.4 per cent were business professionals, 23.5 per cent were administrative service workers. In addition, managers and business executives made up around 22.2 per cent of the survey responses. These surveys also reveal a relative stability in employment within the industry. When surveyed, it was shown that the large majority of current staff (61.3 per cent) had only worked within the business services sector with the largest other source being from former public sector (5.9 per cent) and trade (5.9 per cent). However, over 70 per cent of workers surveyed have been in their current job for five years or less, a fact that may be explained by the high levels of activity in the real estate sector over the last five years and the relatively strong growth in employment.



In terms of qualifications, the majority of employees in the business services sector had completed secondary school (36.6 per cent) but not continued on to any form of tertiary education. There were also a significant group of workers who had also attained a diploma qualification (11.1 per cent) or Bachelor degree qualifications or above (13.6 per cent) (see Figure 12.9).

Figure 12.9

QUALIFICATIONS — BUSINESS SERVICES


In contrast to the results of the labour force survey in 2006, the survey results show that the majority of employees had completed Bachelor degree (56.6 per cent). This high showing may reflect some sample selection bias with those with good educational qualifications anxious to report them.

Survey respondents also commented on the skills they see as important for their jobs (now and in the future). On average, respondents highlighted that all of the 12 skills sets suggested were highly important, except for physical skills.

In addition, survey respondents highlighted attitudinal characteristics that they found influential in a job (see Figure 12.10). Respondents from the business services sector found that remuneration was very highly influential (4.09 out of 5).

Figure 12.10

ATTITUDES ABOUT WORK — BUSINESS SERVICES





The stakeholder consultations in this sector provide a partial indication as to the way that structural change is impacting the sector. For example, although the majority of employees in the sector are in real estate almost all the responses received related to the accounting/legal services aspect of the sector.

A key topic of discussion and concern related to issues around the training and education of the workforce in tertiary and service industries in general including those that specifically apply to business services. It is generally agreed in the sector that a major role exists for both generalist academic and applied (vocational) training to be jointly developed.

Some stakeholders (including Gulf Air) said that education in these areas was currently too theoretical and that a strong element of task specific and vocationally orientated education and training should be introduced to cater for the para-professional and advanced clerical areas within business services. Such a discussion, coming from a significant company (airlines as a result of their normal suite of travel- related fringe benefits do not normally have trouble in recruitment) is significant and indicative of a major need in labour force development.

The Awal Gulf Manufacturing Company, although not task-specific in their comments, stressed the need for a polytechnic and the expansion of vocational training in schools. The company also highlighted an under supply of locally trained vocationally orientated workers and stated that some of the training programs currently operating in Bahrain lack quality assurance standards. The Central Bank of Bahrain pointed out the lack of suitably trained personnel in Islamic Finance and Insurance. Deficiencies in this area were also raised by the Bahrain Institute for Banking and Finance.

The company also emphasised the lack of vocational training and shortages of persons trained in Finance and Islamic Banking. Shortages in these areas are common in the Middle East and in Islamic countries in general as a consequence of the rapid development of the Finance industry and are one of the few areas where qualified imported labour may not be readily available. In the longer run this opens up opportunities for Bahraini citizens within the business services sector.

Similarly, Customs and General Organisations of the Ports saw lack of English and accounting skills as a major current limitation among the workforce.

The Solidarity Group saw a lack of general skills and high turnover among Bahraini staff as important issues.

One area of concern from the stakeholder meetings was the feeling by the Bahrain Chamber of Commerce and Industry that while there was general agreement that the economy was suffering a skills shortage, there appeared to be no consensus of how this shortage was to be tackled.

Stakeholders from the business services focus group identified the need for international corporations lawyers and financial accounting managers.



Skills gaps analysis

The skills gaps in Bahrain’s business services sector are apparent from the findings of the labour market analysis, surveys and other reports. Currently, business services sector skills gaps fall into three main categories:

• specialist legal and accounting skills — primarily advisory and analysis

services, targeting such business areas as Islamic banking and insurance, intellectual property and finance

• management and coordination skills — for example, resource managers,

engineering process managers, accountants and sales and marketing executives

• paralegal and legal clerical skills — miscellaneous business and legal support roles, ranging from legal assistances to receptionists and numerical clerks.




• 550 managers

• 400 administrative services.

The type and extent of skills gaps in the business services sector are dependent on:

• the health of the broader Bahraini economy

• demand for services from other sectors, in particular banking and finance

• competition for skilled personnel from other sectors.

Managing skills gaps in the business services sector is thus difficult. In most cases, government and business leaders will only be able to address skills gaps retroactively.

This notwithstanding, Islamic banking and insurance may provide a focal point to strategise about skills gaps in the business services sector. Stakeholders and international trends suggest that skills gaps exist across all the main categories listed above as they relate to servicing the Islamic banking and insurance industry. Specialist legal and accounting services are particularly in demand.

The key skills gaps identified for the health sector are summarised in Table 12.7, including the sources from where the skills gaps have been highlighted.



Table 12.7 SKILLS GAPS SUMMARY — BUSINESS SERVICES

Study input

Specialist legal and accounting

services

Management and

coordination

Paralegal and

clerical

Labour market analysis û ü û Qualifications analysis û û û Survey of employers ü ü ü Survey of employees û û û Survey of graduates û û û Survey of Education Institutes û û û Key stakeholder consultations ü ü ü

Other information sources ü û û


12.6 SWOT snapshot

On the basis of the analysis above, a snapshot of the strengths, weaknesses, opportunities and threats to the business services sector in Bahrain has been completed (see Table 12.8). This summarised information will be used to inform action plans for a small number of sectors in Report 4.

Table 12.8 SWOT — BUSINESS SERVICES

STRENGTH WEAKNESS • Employer preference for Bahraini trained accountants. • Well placed to service emerging Islamic finance and

insurance sector. • Favourable legislative environment.

• Current graduate numbers are insufficient to meet dem and.

• Insufficient business services-related places in university and other training providers, particularly vocational training.

• Competition for labour with IT and telecommunications services.

OPPORTUNITY THREAT • The emergence of a global market for business services. • Potential for increased female participation. • Likely introduction of property law into the regulatory

framework.

• Ability to retain skill Business Services staff within the sector.

• International competition via the provision of inexpensive online business services.





The major problems facing the expansion of the business services sector are similar to those in a number of Bahraini industries. These include:

• demand generation — although the labour market analysis predicts a doubling

of the workforce over the period 2007-2012, it is not known if outsourcing to the burgeoning internet based business services sector has been included as a constraint or if any analysis of the potential impact of these services has been factored into the modelling. For example, the McKinsey Quarterly, listed eight new trends in business technology and highlighted the role of internet based outsourcing (McKinsey Global Institute 2005) and another researcher has painted a future scenario where business services, especially knowledge intensive business services, will become widely traded e-products, displacing lagging domestic suppliers (Toivonen 2004)

• labour force supply — labour market analysis suggests that the industry will

still be 68 per cent reliant on non-Bahraini’s by 2012. This appears to run counter to the policy of Bahrainisation and may encounter problems in this area, As well unless, female participation, especially of those with post-school training increases above the current rate, there may be problems in attracting sufficient domestic labour to cover even the 32 per cent predicted for Bahrainis

• labour force skills — this is potentially the greatest problem facing the industry

because at the top end of its labour requirements it will be in competition for skilled managerial and technical labour. As well, the majority of needed labour will require vocational training either by itself or in combination with general academic training. Lack of opportunities for vocational training has been identified during the consultative process as a major constraint to growth in the economy.



Chapter 13

Manufacturing


Manufacturing comprises the transformation of materials into new products. This transformation can:

• begin with ‘raw materials that are products of agriculture, forestry, fishing,

mining or quarrying as well as products of other manufacturing activities’

• create a new product that is ‘finished in the sense that it is ready for utilization or consumption, or it may be semi-finished in the sense that it is to become an input for further manufacturing’

• be undertaken by ‘power-driven machines’ in a plant, factory or mill, or by

hand in a worker’s home (United Nations Statistical Division 2008).

The manufacture of basic metals – primarily aluminium smelting and casting – dominates the sector in Bahrain. Other key manufacturing industries include:

• food, beverages and tobacco

• textile and leather

• wood and wood products including furniture

• paper products, printing and publishing

• chemicals, petroleum, rubber and plastic

• non-metallic mineral products

• fabricated metal products, shipbuilding and repairing.

To support these industries there are a range of occupations available in the Bahraini manufacturing sector, including:

• engineers (chemical, electrical, electronic, materials, mechanical and

production)

• scientists (chemists and metallurgists)

• tradespeople involved either directly in the transformation of materials into new products (such as bakers and custom tailors), or the operation and/or maintenance of the machinery and material-handling equipment that is used to transform materials into new products (such as furnace and rolling mill operators)

• managers and administrators.



Key players in manufacturing

Key players in Bahrain’s manufacturing sector include:

• Aluminium Bahrain (Alba) — jointly owned by the Government of Bahrain (77 per cent), Saudi Basic Industries Corporation (SABIC) Industrial Investments (20 per cent) and Breton Investments (3 per cent), is the world’s largest aluminium smelter, with a combined total production capacity of 850 000 tonnes per annum. The company has a workforce of over 3 000 (close to 90 per cent of which are Bahraini), and contributes approximately BD200 million to the national exchequer (Aluminium Bahrain 2008). Due to the presence of Alba, Bahrain is the site of a number of downstream aluminium manufacturers. Key amongst these are:

– Gulf Aluminium Rolling Mill Company (Garmco), with an estimated 767

employees (84 per cent of which are Bahrainis) (Garmco 2008)

– Bahrain Aluminium Extrusion Company (Balexco)

– East Aluminium, with approximately 100 employees (East Aluminium 2008).

• Arab Shipbuilding and Repair Yard Company (ASRY) — owned by a number

of national governments across the Middle East and North Africa, including the Kingdom of Bahrain. ASRY has been operational in Bahrain since 1977. The company has an estimated 1 562 employees (51.2 per cent of which are Bahraini), and reported annual revenue of BD64 million in 2007 (Arab Shipbuilding and Repair Yard 2008).

• Manama Textile Mills (MTM) — MTM is a vertically integrated textile

manufacturer, with capabilities in spinning, weaving, denim and fabric processing. It employs approximately 3 000 people, 22 per cent of which are Bahraini (Fibre 2 Fashion 2006).

Other recent additions to Bahrain’s manufacturing sector include:

• Kraft, which recently established a food manufacturing plant in Bahrain. The

plant is expected to contribute $120 million per annum into the local economy (through wages, raw materials, etc.). At present, 13.5 per cent of the labour force are Bahraini. This figure is expected to rise to 20 per cent as the plant completes its hiring process (AME info 2008).

• RUF Automobile GmbH, which opened the region’s first car manufacturing

plant in April 2007. The facility cost $20 million to complete and can produce 20 vehicles per annum. A second plant is expected to come online in 2009 (Business Monitor International 2008).




Wages in the manufacturing sector are comparable with the broader Bahraini economy. There is a significant difference, however, between the wages of Bahraini and non-Bahraini manufacturing workers (see Table 13.1). Over the last four quarters for which data is available (December 2007–September 2008), the average monthly wage for manufacturing employees was BD234, equal to that of all Bahraini employees. Bahraini manufacturing workers earned slightly more than Bahraini workers overall, while non-Bahraini manufacturing workers earned slightly less than non-Bahraini workers overall.

As Table 13.1 highlights, there are discrepancies in manufacturing wages by establishment size. Bahrainis in manufacturing establishments employing 1 to 9 workers earned an average monthly wage of BD1 205 — 122 per cent more than Bahraini manufacturing workers overall, and 416 per cent more than the average for all manufacturing workers. In contrast, non-Bahrainis in manufacturing establishments employing 1 to 9 workers earned BD75, or 68.1 per cent less than the average for all manufacturing employees. This divergence in earnings is most likely the result of the different roles in which Bahrainis and non-Bahrainis are employed in smaller manufacturing establishments. While Bahrainis generally fill executive-level positions, non-Bahrainis are typically employed as manual labourers.

Average monthly wages in larger manufacturing establishments (those employing more than 10 workers) were more comparable with the averages for the sector.

Table 13.1 AVERAGE MONTHLY WAGES (BD) — DECEMBER 2007–SEPTEMBER 2008

Total Establishments 1-9 workers Establishments 10+ workers

Total Bahraini Non- Total Bahraini Non- Total Bahraini Non- Bahraini Bahraini Bahraini

Manufacturing 234 543 147 113 1 205 75 282 507 187 All sectors 234 522 167 146 798 100 271 489 201

Source: (Labour Market Regulatory Authority 2008a).

The manufacturing sector accounted for 12.5 per cent of all newly registered workers at GOSI for the period December 2007–September 2008. Non-Bahraini males were responsible for the lion share (61.6 per cent) of newly registered manufacturing workers, followed by Bahraini males (22.7 per cent), Bahraini females (13.1 per cent), and non-Bahraini females (2.7 per cent).



Figure 13.1 NEWLY REGISTERED WORKERS — DECEMBER 2007–SEPTEMBER 2008

Source: (Labour Market Regulatory Authority 2008a).

13.2 Manufacturing in Bahrain

Manufacturing in Bahrain has experienced significant growth since the turn of the 21st century. The value of the sector increased 177.2 per cent from 2002 (BD383.4 million) to 2007 (BD1062.8 million). Manufacturing’s share of GDP also grew over this period — from 12.0 per cent to 15.3 per cent (see Figure 13.2). Employment in manufacturing, however, has not matched the expansion of the sector’s value. While the number of workers employed in manufacturing grew by 29.1 per cent over 2002-07 (from 49 152 to 63 436), the sector’s share of Bahrain’s total labour force dropped by over a fifth.

Figure 13.2

MANUFACTURING AS A PROPORTION OF GDP — 2002-2007



The University of Bahrain (UB) offers undergraduate and graduate education in science, engineering, and business services that are sought by companies in the manufacturing sector:

• the College of Science at UB comprises four departments (mathematics,

chemistry, biology and physics), employs 95 staff and has approximately 830 students enrolled in its various programs. The College offers Bachelor degrees with majors in mathematics, chemistry, biology and physics. Box 13.1 provides a sample of available courses



• the College of Engineering at UB employs 138 staff across its four departments — Civil Engineering and Architecture, Chemical Engineering, Mechanical Engineering, and Electrical and Electronic Engineering. Over the past six financial years, the College of Engineering has maintained annual enrolment levels of approximately 570 students (University of Bahrain 2008c). In 2007-2008, the most popular programs were Civil Engineering (accounting for 25.4 per cent of total undergraduate enrolments), Electronics Engineering (19.8 per cent) and Mechanical Engineering (18.7 per cent)

• the College of Business at UB also provides a number of courses relevant to

the manufacturing sector shown in Box 13.1.

Box 13.1 MANUFACTURING-RELATED COURSES AT THE UNIVERSITY OF BAHRAIN

College of Science: • General Chemistry I & II • Language Development I & II • Quantum Mechanics • General Physics I & II • Calculus & Analytical Geometry I & II • Organic Chemistry I & II • Protein Biotechnology • Biochemistry • General Biology I & II • Modern Physics • Practical Physical Chem istry • Applied M athem at ics. College of Engineering: • Architecture (B.Sc.) • Chemical Engineering (B.Sc. and M.Sc.) • Civil Engineering (B.Sc. and M.Sc.) • Electrical Engineering (B.Sc. and M.Sc.) • Electronics Engineering (B.Sc. and M.Sc.) • Engineering Management (M.Sc.) • Interior Design (B.Sc.) • Mechanical Engineering (B.Sc. and M.Sc.) • Process Instrumentation and Control Engineering (B.Sc.). College of Business: • Accounting (B.Sc.) • Banking and Finance (B.Sc.) • Business Administration (MBA) • Business Management (B.Sc.) • Marketing (B.Sc.).

Source: (University of Bahrain 2008b).



Other university providers include the University College of Bahrain, Arab Open University, and Gulf University. These providers offer courses relevant to corporate support of manufacturing operations, such as engineering and manufacturing management. In addition, Gulf University offers undergraduate and graduate degrees in engineering (civil, electrical and electronics, industrial, mechanical and metallurgical) (Gulf University 2008b).

The primary provider of vocational education relevant to the manufacturing sector is the Bahrain Training Institute (BTI). Formed in 1981 as the Vocational Training Centre, the Institute offers training programs to accommodate the needs of a range of sectors, including ‘industry, operation, construction, trade, information technology, travel and tourism, and services’ (Bahrain Training Institute 2007).

BTI offers two types of training programs: regular full-time programmes for job seekers and short corporate training programmes for corporate personnel. The former generally last one to two years and are internationally accredited. The latter are shorter in length and tailor-made to the corporate training needs of both public and private sector clients. Figure 13.3 outlines total number of trainees in BTI’s various training programs for 2006 and 2007.

Figure 13.3

TRAINEE NUMBERS, BAHRAIN TRAINING INSTITUTE

Source: (Bahrain Training Institute 2007).

In addition to the tertiary and vocational education sector, a number of manufacturing companies have their own training institutes. For example, Alba has a dedicated Training Centre that provides a range of managerial, technical and general development courses throughout the year — facilitating training each year for around 70 per cent of its workforce (Aluminium Bahrain 2006). The Centre receives BD3 million in annual funding, and has 15 full-time staff. In 2006, Alba announced that it would spend BD350 000 on upgrading its training facilities to ensure that they could ‘operate with the latest training methods and programs that reflect Alba’s international reputation’ (Bahrain Tribune 2008).



13.4 International trends in manufacturing

There are two international labour market trends in the manufacturing sector that are important to consider for Bahrain and its future workforce — a steady decline in manufacturing employment and a growing skills shortage.

Firstly, as Figure 13.4 illustrates, OECD countries have experienced a general 8.5 per cent decline in their manufacturing workforces from 1997 to 2006. Furthermore, manufacturing’s share of total employment in OECD countries has dropped from an average of 16.7 per cent to 13.7 per cent over this same period (Organisation for Economic Co-operation and Development 2008a). In comparison, Bahrain’s manufacturing labour force dropped from 16.0 per cent in 2002 to 12.6 per cent in 2007.

Figure 13.4

PERCENTAGE CHANGE IN MANUFACTURING EMPLOYMENT 1997-2006

Source: (Organisation for Economic Co-operation and Development 2008a).

This reduction in manufacturing employment is not limited to the developed world. Key non-OECD countries such as Brazil, China, India and Russia are also experiencing a decline in the manufacturing workforce (Pilat, Cimper et al. 2006). A recent report suggests that manufacturing employment in China fell from 98 million workers in 1995 to 83 million in 2002 — a 15 per cent decrease (Carson 2003). India’s experience has been similar, with the country’s organised manufacturing workforce shrinking by 13 per cent (or 1.3 million workers) between 1996 and 2001 (Nagaraj 2004).

However, this general decline in global manufacturing employment is not the result of a drop in demand for manufactured goods or a decrease in the value of manufacturing production. As Figure 13.5 highlights, the value of manufacturing across OECD economies has enjoyed strong growth over the past decade.



Figure 13.5 VOLUME INDEX OF MANUFACTURING — VALUE

Source: (Organisation for Economic Co-operation and Development 2008a).

The key factor, rather, is increasing productivity in the manufacturing sector. This appears to be the case not only in developed countries (as Figure 13.6 shows), but also in non-OECD countries (Pilat, Cimper et al. 2006). A 2004 report identified that the decline in China’s manufacturing workforce from 1995 to 2002 was matched by annual productivity growth of 17 per cent in the sector. Likewise, labour productivity in India’s manufacturing sector grew by 80.6 per cent from 1991 to 2001 (Nagaraj 2004).

Figure 13.6

OUTPUT PER HOUR IN MANUFACTURING — INDEX, SELECTED COUNTRIES

Source: (Bureau of Labor Statistics 2008).

The second important labour market trend in international manufacturing is a growing skills shortage. This trend seems counter-intuitive, given declining employment opportunities in the sector. However, manufacturing companies — particularly in emerging markets — report difficulties in attracting and retaining qualified personnel. For instance:

• in a 2007 report of manufacturing in emerging markets, one-quarter of

interviewed executives reported that they ‘found it very difficult to attract qualified workers in China, India, Latin America, and Eastern Europe’ (Deloitte 2007)



• in a 2005 study of the American manufacturing sector, more than 80 per cent of surveyed manufacturing companies indicated that ‘they are experiencing a shortage of qualified workers overall’ (National Association of Manufacturers 2005).

This talent crunch is seemingly driven by the growing complexity of manufacturing jobs (which requires advanced and more specialised skill sets) and negative perceptions of manufacturing as a viable career choice for younger workers.


This section will explore the labour market and skills needs of the manufacturing sector in Bahrain. It will do this by analysing:

• current and future employment trends

• current and future qualification attainment trends

• surveys of manufacturing employees and employers.


As mentioned above, the recent labour market fortunes of manufacturing has been mixed. On the one hand, the number of workers in the sector has grown from 49 152 in 2002 to 63 436 in 2007 (an increase of 29.1 per cent). This growth, however, has not kept pace with the rest of the Bahraini economy, with manufacturing’s share of total employment dropping from 16.0 per cent in 2002 to 12.6 per cent in 2007.

As Figure 13.7 highlights, non-Bahraini males dominate employment in the sector. The number of manufacturing workers grew from 24 830 in 2002 to 45 329 in 2007 (an increase of 82.6 per cent), and the share of total manufacturing employment expanded from 54.0 per cent to 71.5 per cent over the same period. In contrast, the number of Bahraini males employed in manufacturing dropped from 16 557 in 2002 to 13 290 in 2007 (a decrease of 19.7 per cent), with a decrease in the share of manufacturing employment from 36.0 per cent to 20.9 per cent.

Figure 13.7 EMPLOYMENT TRENDS, BAHRAINI AND NON-BAHRAINI MALES, MANUFACTURING, 2002-2007




The manufacturing sector appears to be losing its appeal with Bahraini females (see Figure 13.8). The number of female manufacturing workers dropped from 4 144 in 2002 to 2 817 in 2007 (a decrease of 32.0 per cent). The presence of non- Bahraini females, meanwhile, is expanding. Their number of manufacturing workers grew 376 per cent — from 421 in 2002 to 2003 in 2007). However, non- Bahraini females still only accounted for 3.2 per cent of all manufacturing employees at the end of 2007.

Figure 13.8 EMPLOYMENT TRENDS, BAHRAINI AND NON-BAHRAINI FEMALES, MANUFACTURING, 2002-2007


Manufacturing is expected to experience similar labour market trends in the future as it has over the past five years. The number of workers employed in the sector is projected to grow from 63 436 in 2007 to 98 519 in 2012 (an increase of 55.3 per cent).

As Figure 13.9 illustrates, the number of non-Bahraini workers in manufacturing is expected to continue to expand — from 47 329 in 2007 to 82 626 in 2012 (an increase of 74.6 per cent). As a consequence, their share of total manufacturing employment is also expected to rise — from 74.6 per cent in 2007 to 83.9 per cent in 2012. While the Bahraini share of total manufacturing employment is projected to decrease commensurately, the number of workers in the sector is expected to remain relatively stable, decreasing from 16 107 in 2007 to 15 814 in 2012 (a drop of only 1.8 per cent).



Figure 13.9 PROJECTED EMPLOYMENT TRENDS, MANUFACTURING, 2007-2012

Source: (Allen Consulting Group and Eidos); (General Organization for Social Insurance (GOSI) 2008).


The 2008 employee survey results, in contrast, reveal a manufacturing workforce with a greater skills profile. Only 43.7 per cent of manufacturing respondents reported primary or secondary school as their highest level of educational attainment (nearly 40 per cent below the 2006 figure). A further 43.7 per cent, meanwhile, reported having a Diploma or above, with 22.7 per cent declaring a Bachelor degree as their highest level of educational attainment (see Figure 13.10).

Figure 13.10 QUALIFICATIONS — MANUFACTURING


Forecast qualifications gaps in the manufacturing sector between 2008 and 2012 are expected to be for employees who have completed secondary school or primary and preparatory school (72 per cent of the total qualification gap). This projection, however, is based on 2006 data and the 2008 survey results show that there may be an increased need for people with a Bachelor degree as well as those with secondary education.



Employee and employer surveys

Employee survey

The employee survey comprised 119 manufacturing sector participants (12 per cent of the total respondents). The majority of these were male (87.4 per cent), less than 35 years of age (68.9 per cent), and born outside of Bahrain (87.4 per cent). Figure 13.11 displays how surveyed employees described their occupation.

Figure 13.11



A majority of manufacturing respondents (53.8 per cent) reported earning less than BD200 per month. A further 32.9 per cent earn between BD200 and BD700 per month. In comparison, only 29.7 per cent of all employee survey respondents reported earning less than BD200 per month, while 47.3 per cent reported earning between BD200 and BD700 per month. These results suggest that earnings in manufacturing are considerably lower than other sectors.

With regard to the duration between completing education and commencing work, the three largest responses were:

• immediately after completion (32.7 per cent)

• within three months of completion (21.0 per cent)

• already employed (16.0 per cent).

Only 8.4 per cent of manufacturing respondents declared that they had taken two or more years to commence work after completing their education.

Survey respondents also commented on the skills they see as important for their jobs (now and in the future). On average, respondents highlighted that physical skills were the most important, followed by literacy, work communication and management skills.

In addition, survey respondents highlighted attitudinal characteristics that they found influential in a job (see Figure 13.12). Respondents from the manufacturing sector found that remuneration was very highly influential (4.09 out of 5), followed by the work environment and work-life balance (3.74 out of 5).



Figure 13.12 ATTITUDES ABOUT WORK — MANUFACTURING


Employer survey

The employer survey comprised of 68 manufacturing respondents, which employ a total of 9 588 employees, or 15.1 per cent of the manufacturing sector. Of these 9 588 employees, 55.2 per cent are Bahrainis and 94.1 per cent are male.

Table 13.2 provides a breakdown of manufacturing respondent employee numbers by first-tier occupational groups and demographics. The largest occupational groups are other occupations and construction occupations.

Bahraini and non-Bahraini males are predominantly employed in other occupation, construction occupation, and engineers and engineer technician positions. Bahraini and non-Bahraini females, in contrast, are predominantly employed in administrative services, manager and business executive, and services and sales people roles.

Bahraini males represent more than 50 per cent of all occupational groups except business professionals and administrative services.

Table 13.2 FIRST TIER OCCUPATIONAL GROUPS — MANUFACTURING

Bahraini Males Bahraini Females Non-Bahraini Non-Bahraini

Males Females Managers and business executives 8% 22% 5% 24% Scientists and science technicians 4% 2% 3% 0% Engineers and engineer technicians 12% 6% 8% 0% Health professionals 1% 1% 0% 1% Business professionals 1% 7% 2% 5% Administrative services 3% 51% 4% 30% Services and sales people 6% 7% 7% 34% Construction occupations 27% 3% 16% 6% Other occupations 38% 1% 56% 0% Total 100% 100% 100% 100%




Table 13.3 provides a breakdown of manufacturing respondent employees by second-tier occupational groups. Building construction jobs in the manufacturing sector accounts for one quarter of the employees, while various engineer/engineering technician positions account for a further 12 per cent. Other occupations identified by respondents include: chemical, mechanical, electrical, and electronics engineers; professionals in law, economics, and systems analysis, and industrial managers.

Table 13.3 SECOND-TIER OCCUPATIONAL GROUPS (PROPORTION 2008) — MANUFACTURING

Occupational Group Percentage of Employees

Building construction 26% Other 13% Electrical equipment and instruments assembly 6% Supervisors of sections 5% Salesmen 5% Equipment and instruments assembly 4% Administrative clerical 3% Private sector managers 3% Industrial engineers 3% Civil engineering and survey technicians 3% Engineering technicians 2%


Table 13.4 shows an indicative forecast to 2012 of second-tier occupations that apply to the manufacturing sector. The indicative forecast is based on the following method:


to 117 occupation categories). 72 per cent of manufacturing employers who participated in the survey responded to the second-tier related questions

• for the manufacturing sector, the key second-tier occupation categories were

compared to relevant ILO statistics for the United Kingdom in 2007 as a proxy (and in some cases compared further to Hong Kong and Iran) to provide a benchmark to validate the forecast. A benchmark was unavailable drawn from Bahrain or any other GCC State (International Labour Organization 2007)


manufacturing sector and the outcomes of the stakeholder consultations undertaken as part of the Skills Gaps Research Study

• the key limitations for the results in the manufacturing sector are that the

respondents to the second-tier occupation categories were 72 per cent of the total sector responses. In addition, there is a limitation of using the United Kingdom as a proxy because the manufacturing sectors in Bahrain and the United Kingdom will have some differences in workforce needs.




Table 13.4

SECOND-TIER OCCUPATIONAL GROUPS (INDICATIVE FORECAST 2012) — MANUFACTURING

Indicative forecast Proportion of total Second-tier occupation 2012 forecast occupation

gap Building construction 6 000 31%

Other Inc ludes: • metal product ion • moulding mechanics • engine operators Electrical equipment and instruments assembly

Equipment and instruments assembly

Inc ludes:

• mechanical equipment and assembly occupations

2 900 15%

2 800 15%

1 900 10%

Supervisors of sections Salesmen

1 200 6%

1 100 6% Administrative clerical

Inc ludes: • Secretaries • administrative specialists • accounting and finance clerks

750 4%

750 4% Private sector managers Inc ludes: • administrative manager • other managers

Industrial engineers Civil engineering and survey technicians



700 4%

600 3%

400 2%

19 100 100%


As Figure 6.7 highlights, the occupational groups that have the highest average monthly wages are managers and business executives, scientists and science technicians, and engineers and engineer technicians. Construction occupations and health professionals, in contrast, have the lowest.



Figure 13.13 AVERAGE MONTHLY WAGE (BD) BY OCCUPATION GROUP — MANUFACTURING


Respondents were asked to comment on factors that constrained manufacturing organisations from hiring additional staff.

• 27.9 per cent identified a shortage of good candidates (compared to

26.5 per cent for all survey responses)

• 14.7 per cent highlighted difficulty in attracting good candidates (compared to 13.6 per cent overall)

• 13.2 per cent nominated difficulty in attracting good candidates to the

organisation’s location (compared to 6.9 per cent overall)

• 32.4 per cent identified that they were happy with the number of staff they currently employed (compared to 44.4 per cent overall).

These findings suggest that the skills shortage in the manufacturing sector is more acute than in the Bahraini economy at large.

Survey respondents noted that they currently have vacancies primarily at the construction occupations, administrative services and services and sales people levels (Figure 13.14). No vacancies were reported at the education providers and business professionals levels.

Figure 13.14

CURRENT VACANCIES — MANUFACTURING




Survey respondents also noted that, over the next five years, they are likely to create the most positions at the manager and business executives, construction occupations and other occupations levels. Respondents did not indicate that they would create positions at the education providers and health professionals levels.

Figure 13.15 POSITIONS CREATED OVER THE NEXT FIVE YEARS — MANUFACTURING


Respondents also noted the change in quality of recruits in the manufacturing sector by nationality compared with two years ago. One respondent indicated that the skill levels of Bahraini recruits had reduced over this period, while none did so in the context of non-Bahrainis. Significant proportions of respondents, however, specified that recruits exhibited higher standards of technical and/or generic skills compared with two years ago (see Figure 13.16). The quality of non-Bahraini recruits is generally seen to have improved to a greater extent than Bahraini recruits.

Figure 13.16



On average, manufacturing respondents identified remuneration factors (high personal income, income sufficient to reward effort, income is predictable, and income increases with experience) as being amongst the most influential in affecting an employee’s decision to take a job. Other factors that scored highly include being treated with respect, opportunities for promotion and job security.



Manufacturing respondents also rated the importance of skills they look for when hiring employees on a scale ranging from not important to very highly important. Technical know-how was rated the highest, followed by work communication, customer communication, literacy skills and physical skills (see Figure 13.17). Manufacturing employers rated emotional skills, problem-solving skills and persuasive skills as the least important.



Manufacturing respondents also identified the top five skills required in the sector, which are outlined in Table 11.6. The most commonly identified skill required in the manufacturing sector was technical skills (19 per cent of total responses), followed by communication skills (13 per cent).

Table 13.5 TOP 5 SKILLS — MANUFACTURING


Technical skills 19% Communication skills 13% English language skills 7% Sales skills 5% Management skills 3%



Stakeholders from the manufacturing sector identified a number of areas that aided skills gaps in the sector — including a lack of external technical training, a lack of higher-level manufacturing skills (such as engineering), a problem with the quality of education received (particularly in vocational areas) and a lack of industry driven skills training and identification.



A number of stakeholders identified a lack of external technical training for the manufacturing sector. Although BTI does provide vocational technical courses, they are not seen as well targeted to the needs of the sector. Following from this observation, one stakeholder went on to note that there was a lack of industry driven skills identification that was linked to the education system. Another stakeholder noted that there were some significant areas where organisations in the sector undertook skills training themselves and that this was a rare occasion where the needs of the sector were being met.

Further, a small number of stakeholders commented that there is a lack of higher- level manufacturing skills (such as engineering). One stakeholder went on to describe the skills gap as so significant that if it was not addressed in the immediate future that it would be expected that some manufacturing organisations may move from Bahrain to locations where obtaining highly skilled workers would be easier, and perhaps, cheaper.

In addition, all stakeholders in the sector commented on the quality of education received by employees. One stakeholder noted that after completing their formal education it can take an organisation up to 18 months to train an employee to be ‘job ready’. However, another stakeholder supported that high schools and colleges should focus on generic skills and that technically specific skills should be the responsibility of vocational and higher institutes and employers where necessary.

Finally, one stakeholder noted that an apprenticeship type model, employed in many other countries, could be optimally used for improved training in the manufacturing sector, if there was a training institute that could be involved in such a program.


The labour market analysis suggests that Bahrain will not undergo the same contraction in manufacturing employment as generally experienced by developed and developing countries worldwide. The manufacturing sector in Bahrain, however, is likely to suffer a skills shortage comparable with international trends. Currently, skills gaps identified in the sector fall into the following two categories:

• technical skills

• higher-level manufacturing skills (such as engineering).

Results from the employer survey and the current skills gaps identified in the labour market analysis can be used to determine an approximate number of specific occupations required in 2012, including the future need for approximately 31 000 positions:

• 14 000 manufacturing staff

• 2 000 engineers and technicians

• 1 600 managers


• 1 100 administrative staff.



Employee and employer survey respondents also commented on the skills they see as important for their jobs (now and in the future). However, there is a difference in these responses. Employee respondents tended to highlight physical skills, followed by literacy, work communication and management skills. Employer respondents, meanwhile, highlighted technical know-how as the most important, followed by work and customer communication, literacy skills and physical skills.

The increase in manufacturing employment and the skills shortage in the sector are linked, as the increase in employment is likely to drive up demand for trained personnel, leading to a further skills shortage. Moreover, the skills shortage is likely to be exacerbated by the growth in the non-Bahraini share of the manufacturing workforce (see Figure 13.9). Non-Bahraini workers in the sector have historically tended to have a lower skills profile than Bahraini employees.

Forecast qualifications gaps in manufacturing sector are expected to be for employees who have completed secondary school, followed by primary and preparatory school. The employee and employer surveys, however, suggest that there may be greater demand for qualifications at the Certificate/Diploma and Bachelor degree levels.

The key skills gaps identified for the manufacturing sector are summarised in Table 13.6, including the sources from where the skills gaps have been highlighted.

Table 13.6 SKILLS GAPS SUMMARY — MANUFACTURING

Study input

Technical skills High-level manufacturing skills (such as engineering)

Labour market analysis û û Qualifications analysis ü ü Survey of employers ü ü Survey of employees û û Survey of graduates û û Survey of Education Institutes û û Key stakeholder consultations ü ü

Other information sources û ü


13.7 SWOT snapshot

On the basis of the analysis above, a snapshot of the strengths, weaknesses, opportunities and threats to the manufacturing sector in Bahrain has been completed (see Table 13.7). This summarised information will be used to inform action plans for a small number of sectors in Report 4.



Table 13.7 SWOT — MANUFACTURING

STRENGTH WEAKNESS • A strong foundation of education providers — in UB and

BTI — to service Bahraini manufacturers. • World-leading companies in their respective manufactur ing

sub-sectors, such as Alba (aluminium smelting) and ASRY (shipbuilding and repair), some of which already invest in skills developm ent.

• The skills shortage in manufacturing appears to be more acute than other sectors.

• Negative perceptions of manufacturing as a viable career choice.

• Remuneration in manufacturing is low compared to other sectors. This may hamper recruitment and retention strategies.

O P P O R T U N I T Y T H R E A T • Capacity to add further value to training in the Aluminium

industry — locally and within the GCC region. • Global financial crisis and potential softening employm ent

growth in the sector. • Potential for countries in the region or other developed

markets to poach highly educated staff. • Concerted effort to achieve a low carbon economy m ay

threaten employment growth and require new skills.



The biggest challenge facing the manufacturing sector in Bahrain is managing the ongoing fallout from the global financial crisis. A drop in world production will likely lead to a contraction in demand for manufactured products — both Bahraini and otherwise. This, in turn, will likely affect employment growth in the sector, causing it to either stall or even reverse.

A contraction in demand could ease the pressure of the skills shortage facing Bahraini manufacturers if the general reduction in demand for workers cuts across all skills levels. However, if a softening in employment growth were to occur an opposite effect could occur, exacerbating the skills shortage. For example, if companies seek to decrease their unit production costs by bolstering their labour productivity. This, in turn, would likely increase demand for skilled workers in the sector.

Global agreement on a common approach to addressing climate change could pose problems to manufacturing in Bahrain. This could not only affect the competitiveness of energy intensive sub-sectors (such as metal processing) and thus threaten growth in manufacturing employment, but also increase demand for a range of new skills as companies seek to reduce their carbon output and/or exploit carbon opportunities.

Although wage policy is not an objective of the Skills Gaps Research Study, another related challenge facing the sector is enhancing the appeal of manufacturing as a career choice for young Bahrainis. Attracting ‘Generation Y’ to manufacturing is a global problem with no easy answers. A possible solution is addressing the low levels of remuneration in the sector. This is especially important, given how influential remuneration factors were in employee survey responses.

A final challenge is ensuring that the Bahraini education system is increasingly responsive to the skill needs of the manufacturing sector.



Chapter 14

Tourism and hospitality


Bahrain’s tourism and hospitality sector consists of hotels and restaurants, visitor accommodation, tourism experience services, and the travel retail sector. Bahrain’s transport sector is an important part of the sector’s performance and development (Euromonitor International 2006). Key transport infrastructure supporting the sector is the Bahrain International Airport, the King Fahd causeway linking Bahrain to Saudi Arabia, and Gulf Air.

The Bahrain General Tourism Authority is a key outcome of the Tourism Masterplan released by the Economic Development Board in 2007 (Oxford Business Group 2008). The Tourism Masterplan is focussing on family and business tourism, and aims to double tourism income over the next seven years and generate 10 per cent of GDP from the sector by 2014. The Masterplan outlines 12 zones specifically for tourism development, including zones for mixed-use mega projects and a boutique heritage zone.

Examples of initiatives and/or developments in the sector are as follows:

Major Infrastructure

• Expansion of Bahrain’s International Airport’s to raise capacity to 15 million

passengers by 2010.

• Construction of the 45km Qatar–Bahrain Friendship Bridge that will extend the King Fahd Causeway that connects Bahrain and Saudi Arabia, linking the entire region (Oxford Business Group 2008).

• US$800 million development of a boardwalk, restaurants, and other

family-oriented recreational and entertainment facilities at Al Jazair Beach, Bahrain’s main public beach (Global Investment House 2007a).

Major Development

• Bahrain will have 15 new five-star hotels and 14 four-star hotels within three

years, creating nearly 5000 additional rooms (Gulf Daily News 2008b).

• US$1.2 billion Durrat al-Bahrain (Pearl of Bahrain) development – a network of artificial islands.

• The Al Farabi Care Centre in Busaiteen, a US$34 million health resort for

elderly people designed to encourage medical tourism (AME info 2006).

• US$1 billion residential, commercial and retail development at Amwaj Islands.

• A possible new expo city built next to the Bahrain International Circuit (BIC).

• The Royal College of Surgeons Ireland Bahrain (RCSI) Bahrain Health Oasis has been announced — this is a unique medical education and healthcare campus being developed for Bahrain.



Events and Marketing

• Special events, such as the Formula 1 Bahrain Grand Prix, to attract visitors from Europe.

• An increasing focus on package holidays that target the golf-niche market and

the emerging high-end cruise segment driven by Arabs seeking luxury holidays (Euromonitor International 2006).

Regulation

• A new comprehensive, quality-oriented, internationally comparable and

acceptable hotel classification and rating system, which includes an enforcement/inspection system supported by law (Centre for Science Technology and Economic Development (CSTED)).

• New Government regulations and licensing laws in response to concerns about

Bahrian’s nightlife.

The extent to which these planned developments will be affected by the global financial crisis is not yet known. Assuming that the financial crisis will not alter the longer term trends in the sector, the following data on international visitors, tourism receipts, and hotel occupancy suggest such initiatives and developments will lead to further growth in Bahrain’s tourism and hospitality sector:

• The number of international visitors to Bahrain rose from 1.396 million in

1995 to 4.519 million in 2006. Bahrain is the third most visited country in the GCC, achieving a market share of 16.6 per cent of all visitors to the region in 2003 (Figure 14.1).

• In 2007, 78.9 per cent of visitors arrived by the King Fahd causeway, 20.4 per

cent arrived by air, and the remaining 0.7 per cent arrived by sea. Almost 40 per cent of visitors from Saudi Arabia were day-trippers (Oxford Business Group 2008). Visitors from Europe, USA and Asia tend to come for business purposes. Growth in the sector is due largely to the increase in the number of visitors arriving via the King Fahd causeway (Bahrain Ministry of Information 2008; Central Informatics Organisation 2008).

• The number of hotel occupancies rose from 686 262 in 2002 to 1 283 295 in

2006, and tourism nights in hotels rose from 1.385 million to 2.474 million over the same period. However, the average stay per person fell from 2.1 days in 2002 to 1.9 days in 2007.

• International tourism receipts for Bahrain rose from US$247 million in 1995 to

US$1048 million in 2006. Formula 1 Bahrain Grand Prix generates almost US$400 million in direct income to businesses and trades (Global Futures and Foresight 2007), and attracts around 800 000 visitors (Euromonitor International 2006).



Figure 14.1 MARKET SHARE, GCC COUNTRIES

Source: (World Tourism Organization 2007; World Tourism Organization 2008).


In response to the Ministry of Information’s prediction that hotel development will create demand for an additional 3000 jobs, the Specific Council of Training in Hospitality (SCTH) has launched a major campaign to encourage more Bahrainis to take up jobs in hotels and other hospitality establishments (Gulf Daily News 2008a).

SCTH focuses on training efforts in the sector, and has its own budget and allocations from training levies (ALL Business 2004). The two main training providers are the Bahrain Institute of Hospitality Management (BIHM), and the Bahrain Training Institute (BTI). BTI includes the Travel and Tourism Academy.

Subsidies from the Bahrain Government, and the Training Levy Scheme are the key funding sources for vocational training programs in Bahrain’s tourism and hospitality sector. Under the supervision of the Specific Council for Training in Hospitality, 964 trainees completed 227 618 training hours at a cost of around US$1.4 million in 2006 (Ministry of Labour 2008).

Bahrain Institute of Hospitality Management

BIHM offers programs in hospitality, travel and tourism and retail studies that range from entry-level to Higher Degree-level.

BIHM is investing BD1.5 million to build a state-of-the-art hospitality college with a vast campus, hostel facilities, resource centre and other infrastructure facilities. The college aims to train hospitality professionals that can meet the needs of international groups coming to the Middle East to establish properties (BIHM, 2007).

Tamkeen is funding BIHM to train 1870 Bahrainis in diverse fields of the hospitality sector. The program will run for five years and offer 6 to 48 months programs. The funding will provide for:

• 1 500 trainees in diverse entry-level positions

• 300 middle-level positions

• 50 participants in the BSc in Hospitality Management



• 20 participants currently working in the HR departments of the hospitality sector to complete their professional HRM qualifications.

The hospitality training programs will be delivered based upon internationally recognised curriculum from the Educational Institute of the American Hotel and Lodging Association (EI-AHLA) and Northwood University in the United States (Tamkeen 2008).

Bahrain Training Institute

BTI is seeking to dramatically increase the number of skilled Bahrainis in the travel industry. BTI offers programs, which are accredited by Cambridge University and the International Air Transport Association (IATA):

• Diploma in Travel and Tourism Operations

• Foundation Diploma in Travel and Tourism

• Advanced Diploma in Travel and Tourism Management

• Bachelor in Travel Management.

Students can take the courses as a full package, and they are required to undertake on-the-job professional work experience and project work. BTI also offers a number of short courses. BTI is establishing two hi-tech laboratories equipped with major Global Distribution Systems and a simulated workplace, the first of its kind in the Gulf (Gulf Daily News 2008b).

14.2 Tourism in Bahrain

Figure 14.2 indicates the size of the tourism sector in Bahrain. In 2007, tourism contributed BD141.82 million (2.1 per cent) to GDP, an increase of 113 per cent from 2002 (Figure 14.2). Further, workers in the sector (25 329) made up 4.7 per cent of the total labour force in 2007, an increase of 48.7 per cent from 2002. Non-Bahraini males account for almost 80 per cent of all employees in the sector.

Figure 14.2

TOURISUM AS A PROPORTION OF GDP AND LABOUR FORCE — 2002 TO 2007




14.3 International trends in tourism and hospitality

The tourism and hospitality sector represents a growing, high employment collection of inter-related service industries. As the OECD (2008) states, tourism accounts for an important share of GDP and of service exports in many countries, and generates a substantial share of total employment. The World Travel and Tourism Council (WTTC) estimates global employment in travel and tourism is in the order of 225 million people (Figure 14.3).

Figure 14.3

WORLD TRAVEL AND TOURISM EMPLOYMENT AND FORECAST

Source: (World Travel and Tourism Council 2003).

Regardless of the current downturn, tourism sectors around the world not only face the ongoing challenge of maintaining a workforce of sufficient size and skills to satisfy customers, they must also address challenges caused by an ageing workforce, technology, globalisation, increased competition and increasing environmental awareness (National Tourism Alliance 2008).

There is ongoing debate about the appropriate role of government in the tourism and hospitality sector. The World Travel & Tourism Council has been concerned about governments neglecting tourism (World Travel and Tourism Council 2003). Conversely, the OECD has observed a proliferation of tourism ministers or secretaries across the OECD. The crucial question however, is not whether government has a role in tourism but what type of role it should play (Richter 1985).

The World Travel & Tourism Council has called for governments to provide a supportive policy framework to help stimulate demand and ensure that the sector continues to generate employment and alleviate poverty in emerging markets (World Travel and Tourism Council 2008). The UNWTO Resilience Committee recommended that governments implementing economic stimulus should consider that tourism has very high export and job delivery capacity (UNWTO Resilience Committee Preparatory Meeting 2008).



A key attraction of tourism to government lies in tourism’s ability to generate employment for people with various types and levels of human capital (Baum 2007). Thus, Government intervention usually includes investing in tourism and hospitality education, training, and skills development. However, there is an apparent paradox in attitudes of government, companies, and the wider community towards employment in the sector. As a service business, employees are integral to delivering on ever-increasing customer expectations — and employers in the sector exhort the value of a skilled workforce. Despite this, jobs in the sector are often viewed as low quality. This is reflected in remuneration levels, which are generally relatively low, particularly in the hospitality sector as shown in several studies, including that of Wood (Wood 1997).

Trends in Tourism in GCC

As a general observation, the most striking feature of the tourism and hospitality sector in the region is the sheer scale, ambition, and intended speed of construction (Global Futures and Foresight 2007). This in turn has major labour implications: the additional demand for labour, and in resultant competition for labour between nations in the region. The region’s forecasts suggest annual travel and tourism revenues could increase 89 per cent over the next ten years (Global Futures and Foresight 2007). Figure 14.4 shows projected demand measured by visitor growth, for the Middle East compared to other regions.

Figure 14.4

PROJECTED REGIONAL VISITOR NUMBERS: MIDDLE EAST COMPARED TO WORLD

Source: (Accenture 2008).

The WTTC had estimated that the Gulf region would need an additional 1.5 million jobs in the sector over the next ten years (Global Futures and Foresight 2007). It has been claimed that the extra staff required just for new developments announced recently will be in the order of 500 000 to 1 million – suggesting the WTTC could have underestimated the labour requirements for the sector. Global Futures and Foresight suggests the true figure for new positions required across the region in travel and tourism could exceed two million (Global Futures and Foresight 2007)..



Our professional judgement is that these forecasts are unlikely to be accurate in the short to medium term (1 to 5 years) given the impact of the global financial crisis on tourism; but as yet there is not firm data on which to base alternative forecasts. Stakeholder consultations indicated that tourist numbers from Saudi Arabia are less likely to be affected than many other countries of origin for tourism, suggesting the effects of the global financial crisis may be less damaging to the sector in Bahrain than in many other countries.

Opportunities and challenges of tourism for Bahrain

These issues raise a number of considerations for Bahrain’s policy makers, in determining appropriate interventions in the tourism and hospitality sector, and in particular labour and skills.

The Bahrain Economic Development Board has identified that tourism is a growing economic driver in the Gulf, and is a target sector for growth in Bahrain’s economic plans (Bahrain Economic Development Board 2007). Bahrain’s vision to build the tourism industry includes increasing the number of visitors through infrastructure improvement. As an island nation with excellent tourism infrastructure, a stable political environment, and good transport connections, Bahrain is well placed to achieve growth at a higher rate than average.

There are however risks associated with the scale of expansion that is underway. These are summarised briefly below:

• maintaining and attracting a sufficient supply of suitably trained employees

• much of the tourism infrastructure under construction is of premium quality,

thus requiring staff with the highest standards of training

• jobs in the sector are not viewed as desirable among the Bahraini population

• Bahrain is likely to face increasing competition for international workers from other nations in the region given the rapidly growing competition for tourism and hospitality labour.

Additionally, Bahrain’s growing luxury tourism infrastructure and development is potentially exposed to the deterioration in external economic conditions. Sustaining this market will depend on Bahrain’s ability to continue to attract tourists, particularly from Saudi Arabia, combined with resilient domestic consumer demand.


In Bahrain, general employment trends in the tourism sector show an increase in employment between 2002 and 2007 — to a total labour force of 25 329 as at December 2007. As Figure 14.5 shows, non-Bahraini male employment dominated the sector and experienced the largest employment growth rate.



Figure 14.5 TOURISM AND HOSPITALITY — 2002 TO 2007


As shown in Figure 14.6, five-star hotels are the biggest employer of hotel workers, and non-Bahraini males accounted for 60 per cent of all hotel employment. The hotel labour force has now increased to 8 025 workers and Bahrainis account for 1667 of these jobs (Gulf Daily News 2008a).

Figure 14.6 BAHRAIN’S LABOUR FORCE BY HOTEL CATEGORY, BY NATIONALITY AND GENDER, 2006

Source: (Specific Council for Training in Hospitality 2007).

Further, data on employees in the Bahrain’s hotels shows that the majority of workers are employed at the basic level (77 per cent), with an additional 16 per cent of workers employed as supervisors. Of workers at the basic level, the largest employee groups include food and beverage service workers (26 per cent), kitchen staff (13 per cent), and housekeeping staff (12 per cent).

Projections for future employment in the tourism sector show that the number of jobs in 2012 will have increased to 31 429 (a 24.5 per cent increase when compared to the number of jobs in 2007 of 25 239) (Figure 14.7). The modelling suggests that employment of non-Bahrainis in the sector will increase by around 25 per cent and remain almost the same for Bahraini nationals. Forecast qualifications in the tourism sector between 2008 and 2012 are expected to be for employees who have completed secondary school (49 per cent of the gap, equal to 3 857 jobs).



Figure 14.7 EMPLOYMENT PROJECTIONS, TOURISM AND HOSPITALITY, 2008 TO 2012



Employee survey

Of the employee survey responses, 47.2 per cent were service and sales workers, 19.4 per cent were administrative services workers, and 16.7 per cent of participants were managers and business executives (Figure 14.8).

Figure 14.8

OCCUPATIONS OF EMPLOYEES – TOURISM


About 62 per cent of sector participants were male, and just over three-quarters of participants were in the 25-39 year age group. Almost 80 per cent had been born in another country, 54 per cent were married, and there was a higher proportion of employees in the sector at the lower end of the wage spectrum e.g., 38 per cent of employees earn BD50–199 per month compared with 25 per cent for all sectors combined.

As shown in Figure 14.9, 41 per cent of participants had completed Bachelor degrees, although 31 per cent had only completed primary or secondary schooling.



Figure 14.9 QUALIFICATIONS — TOURISM AND HOSPITALITY — 2006 AND 2008


Employee survey participants commented on the skills that they see as important for their jobs (now and in the future). Participants indicated that the top five skills sets (out of 12 skills sets) that were important to their work were customer communication, work communication, literacy, checking skills, and problem solving skills (Figure 14.10).

Figure 14.10

TOP 5 SKILLS SETS IMPORTANT TO WORK (EMPLOYEES) — TOURISM AND HOSPITALITY


Survey participants also highlighted attitudinal characteristics that they found influential in a job (see Figure 14.11). Participants from the tourism and hospitality sector identified remuneration as very highly influential (4.13 out of 5) and employment benefits as not influential (1.92 out of 5).



Figure 14.11 ATTITUDES ABOUT WORK — TOURISM AND HOSPITALITY


Employer survey

The employer survey comprised 52 organisations from the sector, representing 6.0 per cent of the total survey sample. These responses represented 23 518 employees or 16.9 per cent. Of the survey response, approximately 35 per cent of employees were Bahraini and 65 per cent non-Bahraini. There is a higher proportion of male to female employees — 70 per cent to 30 per cent.

Table 14.1 provides a breakdown of tourism and hospitality respondent employee numbers by high-level occupational groups and demographics. The largest occupational groups are services and sales occupations and managers and business executive occupations.

Table 14.1 HIGH-LEVEL OCCUPATIONS — TOURISM & HOSPITALITY

High-level categories Bahraini males

Bahraini females

Non-Bahraini males

Bahrain's nstructi











Total 100% 100% 100% 100%




Considering these occupations further, employers when asked to provide information on occupations at a more detailed level (second-tier level). Table 14.2 provides a breakdown of tourism and hospitality respondent employees by second-tier occupational groups. Of the 31 occupational groupings identified by employers mechanical and office precision instruments maintenance account for 17 per cent, while stewards and consumer goods salesmen account for a further 9 per cent each.

Table 14.2 SECOND TIER OCCUPATIONS — TOURISM & HOSPITALITY

Second Tier Occupation Proportion of total sector

responses

Mechanical & office precision instruments maintenance 17% Other 15% Stewards 9% Consumer goods salesm en 9% Private sector managers 7% Private sector section heads 4% Administrative managers 4% Industrial managers 4% Civil servant clerks 3% Salesmen 3% Administrative clerical workers 3% Supervisors of sections 4% Food industry occupations 2% Sales and purchasing 2% Heads of sections 1%


Table 13.4 shows an indicative forecast to 2012 of second-tier occupations that apply to the tourism sector. The indicative forecast is based on the following method:


to 117 occupation categories). 79 per cent of tourism employers who participated in the survey responded to the second-tier related questions

• this data was then included in an ‘occupation analysis’ process, which used a

forecast of the labour market in each sector to draw an indication of the occupation gaps (the difference between the forecast and current workforce) that may be present in 2012 using the proportional responses to the first and second-tier occupation categories (which respondents identified)



• the Allen Consulting Group then validated and adjusted the initial results of occupation analysis to determine their reliability using a framework drawing on subjective and quantitative factors — including whether an occupation category was realistically relevant to a particular sector, whether there was an international or regional benchmark to validate the forecast, and if there was any anecdotal evidence to assist in validation

• for the tourism sector, the key second-tier occupation categories were

compared to relevant ILO statistics for the United Kingdom in 2007 and ABS statistics for Australia in the 2007 financial year as proxies to provide a benchmark to validate the forecast. A benchmark was unavailable from Bahrain or any other GCC States (International Labour Organization 2007; Australian Bureau of Statistics (ABS) 2007-08).


tourism sector and the outcomes of the stakeholder consultations undertaken as part of the Skills Gaps Research Study

• the key limitations for the results in the tourism sector are that the respondents

to the second-tier occupation categories were 79 per cent lower than responses to higher level questions. In addition, there is a limitation of using the United Kingdom and Australia as a proxy because the telecommunications sector in Bahrain and the United Kingdom and Australia will have some differences in workforce needs.




Table 14.3

SECOND-TIER OCCUPATIONS (INDICATIVE FORECAST 2012) — TOURISM & HOSPITALITY SECTOR

Indicative forecast Proportion of

2012 total forecast Second-tier occupation occupation gap

Salesmen 1 070 22% Inc ludes: • consumer goods salesmen

Stewards 740 14% Inc ludes: • food and beverage staff

Other Inc ludes : • tourist services clerks • tourism managers • protective workers & messengers • secretaries • manpower specialists

460 9%

Private sector managers 460 9% Production and m aintenance

Inc ludes: • Mechanical & off ice precision

instruments maintenance Private sector section heads Inc ludes: • heads of sections

450 8%

275 5%

Administrative m anagers 250 5% Food industry occupations

Inc ludes: • waiters

250 5%

Sales and purchasing

Industrial managers

Civil servant clerks

Administrative clerical workers Supervisors of sections Heads of sections Total indicative occupation gap in 2012

250 5%

250 5%

240 4%

190 3%

90 2%

90 2%

5 265 100%


Employers within the tourism and hospitality sector also identified the top five skills required in the sector, these are outlined in Table 14.4. The most commonly identified skill required in the tourism and hospitality sector was communication skills generally (23 per cent of total responses) followed by customer communication skills (13 per cent of total responses) and cooking skills (10 per cent of the total responses).



Table 14.4 TOP 5 SKILLS — TOURISM & HOSPITALITY


Communication Skills 23%

Customer communication skills 13%

Cooking skills 10%

Leadership, organisation and time management 5% skills

Technical skills 4%


Employers reported that the shortage of good candidates and difficulty in attracting staff, constrained their ability to employ more staff. This included a majority of the 5 star hotels — the biggest employers in the sector. Employees and graduates also identified workforce communication and customer communication as key skills. However, employees identified checking skills as opposed to management skills as one of their top five key skills. Graduates ranked emotional skills and planning skills more highly than employers ranked them.

Survey respondents also noted that, over the next five years, they are likely to create the most positions at the manager and business executives, education providers, health professionals and service and sales occupations levels (see Figure 14.12).

Figure 14.12

POSITIONS CREATED OVER THE NEXT FIVE YEARS — TOURISM AND HOSPITALITY

Note: Some stakeholder expressed disagreement with these results from the employer survey. Source: (Allen Consulting Group and Eidos).

Except in the case of remuneration, employer responses about the key factors/attitudinal characteristics that influence employees to take jobs in the sector were different. Employers reported that the factors of: treated with respect, promotional opportunities, job security, and good physical working conditions significantly influenced employees to take jobs.

Employers mainly recruited employees through friends and relatives, direct approach by potential employees, work contact or network, and newspaper advertisements. Employees also used these methods to find work in the sector.



Compared to all sectors in the economy, employers reported higher levels of in-house training, particularly induction training and administration training. They were also more likely to use external local training providers — in the next 12 months they plan to use these providers more often than they had in the last 12 months. Almost one-quarter of employers reported that they were recruiting people with higher standards of technical and generic skills than they did two years ago. However, many wanted to see improvements in employees’ communication skills, customer services skills, and work ethics.

The main group of employees in the survey, managers and business executives, earn on average, slightly less than those employees in the same job in another sector (BD1025 compared to BD1125 in other sectors). Employees in services and sales tend to earn a similar average wage as those in the same positions across other sectors (approximately BD230). The average monthly wages for services and sales, managers and business executives and ‘other’ occupational groups is represented graphically in Figure 14.13.

Figure 14.13 A WAGE COMPARISON — TOURISM & HOSPITALITY COMPARED TO ALL SECTORS


When recruiting in the tourism and hospitality sector employers are attracted primarily by customer communication and work communication skills. Other highly valued skills are management skills, literacy and problem solving skills. Figure 14.14 shows the importance of work related skills to employers in the tourism and hospitality sector.






On stakeholder stated that 7 500 jobs will be required in tourism and hospitality due to new infrastructure projects, and Bahrainis should fill 40 per cent of these jobs. The Ministry advised that the government is seeking to increase tourism to 25 per cent of GDP over the next five to seven years from its current level.

Another stakeholder advised there is a need for more flexibility to hire expatriates in the sector. The Council stated that the low salary level in the hospitality industry is a significant issue, and salary levels do not match the talent in the sector. There is also a religious issue in the sector, in regard to working with alcohol. There are major needs in food and beverage, kitchen and housekeeping staff. Many human resource managers at hotels are not well qualified for this role.

Further, a training provider in the sector advised that trainers are mainly from outside Bahrain, and students are paid a BD60 stipend to attend classes. The institute began ten years ago and most courses are taught in Arabic. The institute is run by a parent company, the Elite Hotel Chain, with 90 per cent of graduates working outside of this chain.

The Bahrain Airport Company stated that growth in tourism is expected to increase pressure on the airport. Existing airport workers require additional training to meet international standards.

One airline stated that its limited training needs are met by sending pilots and cabin crew to either Oman or Jordan, as there are no suitable facilities in Bahrain. Another airline noted that it has three programs running with Tamkeen, including a career progression program and call centre training for around 140 staff. This training was previously undertaken in Oman.

Other key issues raised by stakeholders in the tourism and hospitality sector included:

• greater emphasis on soft skills is essential, for example, communication,

people and relationships

• medical tourism segment is growing in importance



• introduce a formal legal framework for part-time employment

• there is limited career progression in the sector which reduces the willingness of Bahraini participation

• there is a need to investigate the impact of part-time/casual work on the sector

• there are ongoing barriers to attractiveness, particularly low wages and social

stigma. Further, regulations such as access to visas for non-Bahraini workers and LMRA fees also act as a barrier to the sector.


The tourism and hospitality sector has skills gaps in two key areas as discerned from the findings of the labour market analysis, surveys and other reports. These are in:

• generic skills — which have stemmed from a lack of training provision

• soft skills — including motivation to work in the tourism and hospitality

sectors (especially for Bahraini employees) and to enhance this motivation, attracting skilled candidates to jobs within the sector.


• 1 800 other tourism workers

• 1 700 services and sales workers

• 1 000 managers


• 650 administrative staff.

The shortage of training provision within the sector is multifaceted, affecting employees in specific job types and the skills of employees across the sector. Stakeholders indicated that specific examples of skills gaps were skills for human resource managers at hotels and the need for additional training for airport workers. On a more general level, stakeholders noted that a greater emphasis on ‘soft skills’ for employees was needed, such as communication, people and relationship skills. Employer survey participants noted that improvements were necessary for communication, customer service and work ethic skills for employees.

Evidence from the employer survey indicates that the tourism and hospitality sector has difficulties attracting good candidates to retail and trade related jobs. Employers, including many 5-star hotels cited the difficulties in attracting employees. Employers more broadly noted that recruitment was mainly achieved through already-established contacts such as family and friends or networking as well as through newspaper advertisements. A greater focus on human resources skills undertaking recruitment through public means (such as newspaper advertisements and employment websites) rather than through already established contacts may assist to address this problem.



In terms of qualification, it is estimated that there will be a gap in educational levels of employees in Bahrain’s tourism sector of 7 911 employees by 2012 Bahrainis are expected to account for 7.5 per cent of this gap (595 new jobs) and non-Bahrainis are expected to account for 92.5 per cent of this gap (7 316 new jobs). Demand for non-Bahrainis who have completed secondary school is likely to be very strong (accounting for 2 896 new jobs). To a lesser extent, there is likely to be an increase in the number of non-Bahraini employees with a Bachelor degree, Diploma, or preparatory schooling or lower.

The key skills gaps identified for the tourism and hospitality sector are summarised in Table 14.5, including the sources from where the skills gaps have been highlighted.

Table 14.5

SKILLS GAPS SUMMARY — TOURISM AND HOSPITALITY SECTOR

Study input Generic skills gaps Soft skills Labour market analysis û û Qualifications analysis û û Survey of employers ü û Survey of employees û û Survey of graduates û û Survey of Education Institutes û û Key stakeholder consultations ü ü

Other information sources û û


14.6 SWOT snapshot

On the basis of the analysis above, a snapshot of the strengths, weaknesses, opportunities and threats to the tourism and hospitality sector in Bahrain has been completed (see Table 14.6). This summarised information will be used to inform action plans for a smaller number of sectors in Report 4.



Table 14.6 SWOT — TOURISM AND HOSPITALITY

STRENGTH WEAKNESS • Development of a Tourism Masterplan • Increased investment in training • Good transport/infrastructure that supports the sector

• Sector accounts for a small proportion of GDP and employm ent.

• Attracting and retaining labour, particularly highly skilled staff needed to work in premium establishments.

• Jobs are not viewed as desirable among the Bahrain population

• High proportion of workers in lower end of wage spectrum • Workers need to improve their soft skills • Many jobs require unskilled labour e.g. kitchen staff,

cleaning staff, which are mostly filled by non-Bahrainis. OPPORTUNITY THREAT

• Projected increases in visitor numbers and receipts in the medium to longer term

• Niche markets, such as medical tourism, luxury holidays, e-tourism

• Further one-off events such as the Grand Prix • Promoting tourism as offering vocations and career paths

• Day trippers continue to account for the majority of visitors, inhibiting the growth of tourism receipts

• Fall in visitor numbers and receipts in the short-term due to global downturn

• Delays in projects in the construction industry due to the global downturn, which may delay the completion of tourism developm ents

• Increased competition for labour from other GCC countries, making it more difficult to attract another 4,000 workers by 2012



Bahrain’s tourism and hospitality sector is experiencing many of the workforce challenges that are common to tourism and hospitality sectors and services industries in other countries (Services Skills Australia 2008).

Firstly, maintaining and attracting a sufficient supply of suitably trained employees. As much of the tourism infrastructure under construction is of premium quality, staff with the highest standards of training are required. Even with a heavy reliance on workers from other parts of the world, the global nature of the sector is such that the region is competing for the best service talent.

Secondly, as the report has explained, non-Bahrainis primarily resource Bahrain’s tourism and hospitality sector and employment growth in this sector has almost been entirely comprised of non-Bahraini males. This suggests that jobs in the sector are not viewed as desirable among the Bahraini population. Whilst this is not necessarily a problem if there is sufficient participation and job growth by Bahrainis in other sectors, and if there is an ongoing plentiful supply of labour from abroad, it does however pose issues if Bahrainisation is a driving objective for this sector.

Additionally, Bahrain’s growing luxury tourism infrastructure and development is potentially exposed to the deterioration in external economic conditions.

These challenges are potentially significant as Bahrain is likely to face increasing competition for international workers from other nations in the region given the rapidly growing competition for tourism and hospitality labour.



Chapter 15

Trade


Wholesale and retail trade accounts form a significant share of business activity in Bahrain. According to the 2001 national census, 12 590 (or 46.8 per cent) of

8

Bahrain’s 26 923 establishments are involved in ‘trade and repair’. Private individuals own 91.8 per cent of these, while private companies own a further 8.0 per cent. A 2006 survey conducted by the Central Informatics Organisation and the Labour Market Regulatory Authority (2006) estimated that ‘trade and repair’ accounts for 42.7 per cent of Bahrain’s 18 996 establishments.

Wholesale trade

Bahrain depends on imports for the majority of its industrial and consumer goods. Consequently, Bahrain’s wholesale sector is largely dominated by import and export agents. Bahrain is a major business and logistical centre, through air, land and sea infrastructure. In relation to air cargo, the Bahrain International Airport handled approximately 380 000 tonnes of cargo in 2007, representing growth of 6 per cent on the previous year. Key trading partners by air are India and Britain (Economic Times 2008). For sea cargo, the new Shaikh Khalifa bin Salaman Port is one of the largest seaport complexes in the region. The BD52 million port is expected to:

Provide facilities and services of high international standards to the traders, local industries, shipping lines and other businesses. The port, combined with the Bahrain Logistics Zone, which is also nearing completion, will make Bahrain a major logistics hub in the region.

(Shaikh Dalj bin Salman Al Khalifa, cited in: Embassy of the Kingdom of Bahrain 2008a)

Bahrain’s transport infrastructure is described in the transport and logistics sector report, the above is a brief summary in the context of Bahrain’s trading role relating to wholesale trade.

The key participants in wholesale trade include:

• Al-Hawaj. An importer of a range of luxury products, including cosmetics,

clothing and jewellery. It manages a ‘network of warehouses, retail outlets and wholesale dealers, and employs approximately 300 personnel (Al-Hawaj 2008)

• Al-Mannai Group. This diversified company has approximately two centuries

of trading history in Bahrain. Its wholesale division (part of its subsidiary, Universal Enterprises) imports a range of food and associated products. Al-Mannai Group also imports and sells jewellery, cars and automotive parts, office equipment and furniture, and a range of industrial products

8 An establishment is ‘an enterprise, or a part of it, which independently engages in one, or predominately one kind of economic or social activity. It may be owned by individual(s) or government agencies, and it may operate for profit or non-profit’ (Central Statistics Organization 2001)



• Y.K. Almoayyed & Sons. Employing over 3000 full-time staff, this diversified group is an importer and wholesaler of electronics and home appliances, medical equipment, and industrial and building equipment (Y.K. Almoayyed & Sons 2008).

Retail trade

Major integrated mix-use capital projects are a feature of the retail market in Bahrain. Bahrain City Centre is such a project. The complex comprises 150 000 square metres of lease-able space and provision for more than 300 stores, including two multi-level international department stores. International retail brands are a feature of this development. They include Carrefour, Debenhams, Saks, Zara, Mango and Massimo Dutti.

The development of major retail-based projects, particularly the Bahrain City Centre, reflects an objective to place Bahrain’s retail offering in the same bracket as other international cities. Developments of this kind have become prevalent across the Gulf Cooperation Council economies and the Middle East generally.

While rising incomes and expanding populations have been powerful drivers for expansion of the retail sector, social trends specific to the Middle East are also a relevant factor. The region has become steadily more affluent, but climate, landscape and social customs limit the range of leisure options available. Retail is not limited by these factors, so shopping has come to fill an important role in the leisure sector (Melly 2008). Malls offer a social experience, as well as a shopping experience.

Convenience stores remain part of Bahrain's retail scene. Traditional markets, or souks, dominate the market for traditional goods and services such as gold, fabric and confectionary manufacturing. Souks are expected to continue to play a role in the market, because the variety and atmosphere is an attraction in itself, for both locals and tourists (Melly 2008).

Trade in this report includes wholesale and retail trade.

• Wholesale trade is defined by ISIC (United Nations Statistical Division 2008)

as ‘the re-sale (sale without transformation) of new and used goods to retailers; to industrial, commercial or professional users; or to other wholesalers’. This includes transactions involving market intermediaries.

• Retail trade is defined as ‘the re-sale (sale without transformation) of new and

used goods to the general public, for personal or household consumption or utilisation’.

As shown in Figure 15.1, trade is a significant component of the Bahraini economy; accounting for approximately 9.0 per cent of total GDP. The value of the sector grew 119.6 per cent from 2002 to 2007 (from BD287.4 million to BD631.2 million). This is in line with the broader economy, which grew 117.2 per cent over the same period (from BD3 193 million to BD6 936 million).

Trade is also an important source of employment in Bahraini. The number of workers employed in the sector expanded by 126.1 per cent from 2002 to 2007 (see Figure 15.1). The trade sector share of Bahrain’s total labour force increased by 16.4 per cent over this period.



71 599 workers were employed in trade, comprising 14.2 per cent of the labour force. This included 15 324 Bahrainis and 56 275 non-Bahrainis.

Figure 15.1 TRADE AS A PROPORTION OF GDP AND LABOUR FORCE— 2002 TO 2007



In Bahrain, general employment trends in the trade sector show a significant increase in total employment from 27 941 in 2002 to 63 162 to 2007. As Figure 15.2 highlights, there has been noticeable growth in non-Bahraini male employment and non-Bahraini males dominate employment in the trade sector. There has also been growth in the employment of non-Bahraini females, although this is from a comparatively low base. The Bahraini male and female share of total employment remained relatively stable over 2002 to 2007. This reflects the steady growth in consumer demand, and the development of large-scale retail projects of the type described above, which generate a significant number of employment opportunities.

Figure 15.2

EMPLOYMENT TRENDS, TRADE, 2002 – 2007




Vocational training programs are emerging to prepare Bahrainis for positions in the growing retail industry (Oxford Business Group 2008). The ongoing training facilities available for the trade sector include:

• Baisan Institute of Hospitality Management (BIHM) offers apprenticeship and

certificate programs in retail management

• Bahrain Institute of Hospitality and Retail (BIHR)

• Bahrain International Retail Development (BIRD)

• Bahrain Training Institute (BTI).

In relation to export/import training of relevance to wholesale trade, a 12-month Export Trade Training Program was funded by USAID and run by the Volunteers for Economic Growth Alliance in Bahrain during 2006-07. The training covered the fundamentals of export/import requirements and the practical challenges of managing and marketing global trading operations (Volunteers for Economic Growth Alliance (VEGA) 2007).

Bahrain Institute of Hospitality Management

BIHM offers programs in hospitality, travel and tourism, and retail studies that range from entry-level to higher degree-level. Many of these programs involve the placement of students with employers.

The BIHM retail certificate programs offered are:

• Retail Operations Program

• Certificate in Call Centre Management.

Bahrain Institute of Hospitality and Retail

BIHR recently reported that there are currently 489 students who have either completed or enrolled in hospitality and retail management programs. 167 have completed their training and 322 are still in progress. There is also a relatively close balance between male and female participation, with 256 females registered and 233 males.

Tamkeen has two contracts with BIHR, one of which is for the retail sector. This training will equip 650 Bahrainis with internationally recognised skill-sets. The course was based on the industry-respected Australian Retail Association curriculum and assessment pattern. BIHM will conduct seven month and 18 month programs for different batches of eligible Bahrainis, equipping them with skill-sets for three different kinds of work profiles: entry-level retail sector jobs; supervisory- level retail sector jobs; and managerial jobs for Bahrainis currently at the supervisory level. Salary levels in the retail sector begin at BD250 for entry-level jobs, BD350 for supervisory level jobs and BD500 for managerial jobs (AME Info 2008). This program was the first phase of Tamkeen’s efforts to increase skills across the retail sector. The program described below, delivered by BIRD, is the latest phase.



Bahrain International Retail Development

Tamkeen recently signed an agreement with BIRD, for a new training program to commence from March 2009, which will facilitate training for retail sector jobs available to a further 1 500 young Bahrainis (AME Info 2008).

The BD1 947 500 three-year project is the second retail industry-focused training program that Tamkeen is supporting. This reflects the importance that Tamkeen has placed on the retail sector's jobs potential and growth.

The three year project will be divided into 12-week courses, which will run for 360 hours and BIRD will train approximately 500 candidates during each year of the agreement. The project targets entry-level positions as Cashiers, Sales Assistants, Promoters, Beauty Consultants and Merchandisers.

Bahrainis are increasingly willing to work in modern malls and retail outlets and this Tamkeen programme is timed to harness the acceptance of these opportunities.

Bahrain Training Institute

Through its Commercial Studies and Communication and Language Studies Divisions, BTI offers a number of training services for the wholesale and retail trade sector. These services include:

• High National Diploma in Business Management — a two-year program,

focusing on management, bookkeeping and communication skills

• National Diploma in Business in Business and Finance — specialisations for this two-year program include office administration and accounting

• First Diploma in Business and Finance — a one-year program, with streams in

office administration, sales and bookkeeping

• Cambridge ESOL (English for Speakers of Other Languages) qualifications, including Business English Certificate (BEC) Vantage, BEC Preliminary, and Preliminary English Test (PET) (Bahrain Training Institute 2008c; Bahrain Training Institute 2008b).

Figure 15.3 outlines total number of trainees in BTI’s various training programs for 2006 and 2007.

Figure 15.3 TRAINEE NUMBERS, BAHRAIN TRAINING INSTITUTE

Source: (Bahrain Training Institute 2007).



15.2 International trends in trade

Trends have been identified at two levels:

• ‘Mega-Trends’, which are broad trends that have been underway over a long period of time, and which are global in nature. Two such trends are described: the impact of information technology, and the internationalisation of retailing.

• ‘Retailing specific trends’, while the mega trends are impacting on all

industries, there are also a number of trends, which are more specific to retailing. Ten such trends are described.

Mega-Trends

Impact of information technology. While this is now a well-established feature of the retail business, it is worth mentioning because of the likely impact it will continue to have on employment and skills. The implications of information technology advancement for retailing and supply chains is explored by Abernathy (2000) who describe the technology driven revolution in retail practices as lean retailing which is an approach to re-inventing a long established business practice by using new information technologies to cut out waste and make operations more profitable. Predicted by Abernathy et al almost a decade ago, this has proven an accurate forecast.

Internationalisation of retailing. An elite but influential group of trans-national retailers have rapidly achieved high levels of market share in new markets. The brand strength of these retailers has been fundamental to this. Coe and Hess (2005) identify five dynamics behind this: the centralisation of procurement; logistical upgrading; supply network shortening and new intermediaries; the imposition of quasi-formal contracts; and the development of private standards. Coe and Hess (2005) suggest that these forces are favouring large, well capitalised suppliers. The types of brands being referred to are Wal-Mart, Aldi, Carrefour, IKEA and Tesco.

Nordas et al (2008) in an OECD Trade Policy Working Paper, examine how recent developments in the retail sector affect trade in consumer goods. A particular focus is on internationalisation, finding that although large international retailers have emerged in recent years, most are confined to the national market. In most OECD countries, the retail sector has become more concentrated, and the more so the smaller the local market. Part of the OECD report examines the relative impact of allowing the entry of international retailers. It finds that this can have a positive impact on exports of consumer goods, particularly in developing countries. Entry of foreign owned retailers has been a significant issue in countries like India, where retailers are seeking to enter or expand their operations, but are restricted by arcane regulations.



The fate of global retailers in light of recent economic conditions, post the first phase of the U.S. financial crisis, is explored by A.T. Kearney (2008) in its annual ranking of the top 30 countries for retail development. The report states that the Middle East and North Africa region is the ‘hottest market for modern retail growth today’. The report focuses its discussion of the Middle East on developments in Saudi Arabia, pointing out that modern outlets are attracting shoppers. This is significant for Bahrain because of the ease with which Saudi consumers are able to travel to Bahrain, and also because similar large-scale retail development has been occurring in Bahrain. To an extent, the Bahrain retail sector is not only competing with retailers in Bahrain, but also with those in Saudi Arabia.

Retailing specific trends

In the context of the internationalisation of retailing generally, which is also a feature of retail in Bahrain, ten trends in global retailing have been identified (Deloitte 2008):

• social responsibility — this refers to consumer awareness of the impact of their

buying choices, including the treatment of workers throughout the supply chain

• shift of consumer spending towards Asia — the geographic shift of consumer

spending will shift away from the US and towards Asia

• rise of ‘long tail’ retailing — which is a focus on niche opportunities by smaller retailers

• India — which is viewed as representing the biggest growth opportunity in

retailing

• retailing of services — because the service sector grows faster than the goods sector as economies develop, some retailers have diversified into complementary services

• market investment in developed retailers — which could fast-track the growth

of emerging country retailers to a size and sophistication similar to that in countries with a more mature retail sector

• multi-channel integration — this refers to the rise of online retailing and the

threats and opportunities this brings

• focus on customer experience — this refers to focussing on offering customers an enjoyable retail experience

• retailers as world-class marketers — this refers to marketing emphasis being

increasingly directed towards the retail brand rather than product brands.

The question for this report, is what these trends mean for labour and employment in Bahrain retail and wholesale trade?



There are several possible consequences for skills and employment in Bahrain. The first of these is increased demand for, and emphasis on, skills development in the trade sector. This is likely to be driven by:

• continued uptake of information and communications technology throughout

the wholesale and retail supply chain

• ongoing shift towards the expanding provision of services by retailers

• increasing focus on customer experience.

Also significant, is the dramatic change in the global economic environment that has occurred in the latter part of 2008, and will continue during 2009. This may slow those trends that relate to foreign investment, as international retailers may seek to consolidate established markets and take a more conservative approach to developing new markets.

Bahrain’s growing luxury retail segment is potentially exposed to the deterioration in external economic conditions. Sustaining this market will depend on Bahrain’s ability to continue to attract tourists, particularly from Saudi Arabia, combined with resilient domestic consumer demand.


This section discusses the future labour and skills needs of Bahrain’s trade sector with reference to labour market and qualifications analysis, key results from the employee and employer surveys, and key stakeholder consultation.


In recent years, the importance of wholesale and retail trade to the Bahrain labour market has grown. In the last quarter of 2002, the sector employed 34 664 workers, or 12.2 per cent of the total Bahraini labour force. In December 2007, the number of persons employed in trade had increased to 71 599 (an increase of 91.0 per cent) and the sector represented 14.2 per cent of Bahrain’s workforce.

Males, particularly non-Bahraini males, dominate employment in wholesale and retail trade (see Figure 15.4). They accounted for approximately 91 per cent of the sector’s labour force from 2002 to 2007.

The number of non-Bahraini male trade workers grew from 26 088 in December 2002 to 54 030 in December 2007 (an increase of 107.1 per cent) and their share of total trade employment expanded from 69.6 per cent to 75.5 per cent over the same period. The number of Bahraini males also grew — from 7 774 in 2002 to 11 291 in 2007 (an increase of 45.2 per cent). However, the Bahraini male share of total trade employment dropped over the same period — from 20.7 per cent to 15.8 per cent.

The number of both Bahraini and non-Bahraini females employed in wholesale and retail trade has grown — from 2 473 in December 2002 to 4 033 in December 2007 (an increase of 63.1 per cent) for the former, and from 1 017 in December 2002 to 2 245 in December 2007 (an increase of 94.0 per cent) for the latter. This notwithstanding, the proportion of Bahraini and non-Bahraini females working in the sector remained relatively static over the same period.



Figure 15.4 EMPLOYMENT TRENDS, TRADE, 2002-2007


Employment trends in trade over the next five years are expected to differ slightly from those outlined above. The number of workers employed in the sector is expected to grow from 71 599 in December 2007 to 95 098 in December 2012 — an increase of 32.8 per cent, compared to the 91.0 per cent increase that trade experienced over the previous five years.

Similarly, while the Bahraini share of trade employment dropped from 27.3 per cent in December 2002 to 21.4 per cent in December 2007, it is projected to rise to 22.6 per cent in December 2007. Indeed, while the number of Bahrainis employed in trade is expected to grow from 15 324 in December 2007 to 21 532 in December 2012 (an increase of 40.5 per cent), the number of non-Bahrainis employed in the sector is expected to expand at a slower rate — from 56 275 in December 2007 to 73 566 in December 2012 (an increase of only 30.7 per cent) (see Figure 15.5).

Figure 15.5 EMPLOYMENT TRENDS, BAHRAINIS AND NON-BAHRAINIS, TRADE, 2002-2012

Source: (Allen Consulting Group and Eidos 2008); (General Organization for Social Insurance (GOSI) 2008).



Prospective skills gaps in trade are described further below. In summary qualifications are expected to primarily be required at the secondary school level. Employee survey respondents consider that physical skills, customer communication skills and planning will be important for trade sector employees.


The 2008 survey results show a trade workforce with an enhanced skills profile. 34.8 per cent of trade respondents reported primary or secondary school as their highest level of educational attainment (nearly half the 2006 figure). 58.7 per cent, reported having a Diploma or above, with 31.5 per cent declaring a Diploma as their highest level of educational attainment (see Figure 15.6).

Figure 15.6

QUALIFICATIONS — TRADE


Employer and employee survey results

For its modelling of qualifications in the Bahraini trade sector, this report draws on two data sources: a labour force survey conduced by the Labour Market Regulatory Authority in 2006 and an employee survey conducted by Allen Consulting Group and Eidos in 2008.

Employers

The employer survey comprised of 375 trade respondents, which employ a total of 8836 employees, or 12.3 per cent of the wholesale and retail trade sector. Of these 8836 employees, 64.9 per cent are non-Bahraini and 84.7 per cent are male.

Table 15.1 provides a breakdown of manufacturing respondent employee numbers by first-tier occupational groups and demographics. The largest occupational groups are services and sales people, other occupations and managers and business executives. The smallest are health professionals and education providers.



Bahraini males dominate the business professionals (80.7 per cent) and managers and business executives (59.8 per cent) categories, while non-Bahraini males are predominant in the construction occupations (83.4 per cent), engineers and engineer technicians (75.1 per cent), scientists and science technicians (60.7 per cent) categories. Both Bahraini and non-Bahraini females are primarily employed in services and sales people, other occupation and administrative services positions.

Table 15.1 FIRST-TIER OCCUPATIONAL GROUPS — TRADE

Bahraini Males Bahraini Females Non-Bahraini Non-Bahraini Males Females High-level category

Managers and business executives 25% 5% 9% 4% Scientists and science technicians 1% 0% 1% 0% Engineers and engineer technicians 3% 1% 6% 0% Health professionals 0% 0% 0% 0% Educations providers 0% 0% 0% 0% Business professionals 19% 2% 2% 1% Administrative services 12% 22% 9% 11% Services and sales people 22% 40% 43% 40% Construction occupations 2% 0% 7% 0% Other occupations 16% 30% 23% 43% Total 100% 100% 100% 100%


Table 15.2 provides a breakdown of wholesale and retail trade respondent employees by second-tier occupational groups. Consumer good salesmen and salesmen account for a third of employees, while administration-related positions account for a further 18 per cent. Other occupations identified by respondents include accounting and finance clerks, professionals in accounting, financial science, economics, and systems analysts, and commercial managers.



Table 15.2 SECOND-TIER OCCUPATIONAL GROUPS (PROPORTION 2008) — TRADE

Occupational Groups Proportion of total sector

responses Consumer goods salesmen 22% Salesm en 10% Administrative clerical workers 7% Administrative m anagers 5% Protective workers, guards, & messengers 5% Private sector managers 4% Food industry occupations 3% Private sector section heads 3% Other 2% Transport and road vehicle driving occupations 2% Carpenters and decorators 2% Sales/Purchasing mediation occupations 2% Industrial & office equipment installation 2% Building construction occupations 2%

Source: (Allen Consulting Group and Eidos)

Table 13.4 shows an indicative forecast to 2012 of second-tier occupations that apply to the trade sector. The indicative forecast is based on the following method:


to 117 occupation categories). 74 per cent of trade employers who participated in the survey responded to the second-tier related questions

• for the trade sector, the key second-tier occupation categories were compared

to relevant ILO statistics for the United Kingdom in 2007 as a proxy to provide a benchmark to validate the forecast. A benchmark was unavailable drawn from Bahrain or any other GCC State (International Labour Organization 2007). For the trade sector it is important to note that the benchmark identifies that only around 2 per cent of trade sector employees are classified as professionals (other than mangers), which is reflected in the occupations listed for the trade sector below


trade sector and the outcomes of the stakeholder consultations undertaken as part of the Skills Gaps Research Study

• the key limitations for the results in the trade sector are that the respondents to

the second-tier occupation categories were 74 per cent of the total sector responses. In addition, there is a limitation of using the United Kingdom as a proxy because the trade sector in Bahrain and the United Kingdom will have some differences in workforce needs.




Table 15.3 SECOND-TIER OCCUPATIONAL GROUPS (INDICATIVE FORECAST 2012) — TRADE

Indicative Proportion of total Second-tier occupation forecast 2012 forecast

occupation gap Consumer goods salesmen 6800 32%

Salesmen 3200 15%

Administrative clerical workers Inc ludes: • secretaries • administrative specialists

2200 10%

Administrative m anagers Protective workers, guards, and messengers Private sector managers Food industry occupations Private sector section heads

1500 7%

1400 6%

1200 6%

950 4%

800 4% Other

Inc ludes: • professional human resources occupations • tailors and dress makers • general cleaning workers

750 3%

Transport and road vehicle driving occupations Carpenters and decorators

Sales/purchasing mediation occupations

Industrial and off ice equipment installation

Building construction occupations


600 3%

550 3%

550 3%

450 2%

450 2%

21 400 100%


According to trade sector respondents, the occupational groups that have the highest average monthly wages are managers and business executives and business professionals. Construction occupations and other occupations, in contrast, have the lowest (see Figure 6.7).



Figure 15.7 AVERAGE MONTHLY WAGE (BD) BY OCCUPATION GROUP — TRADE


Survey respondents noted that they currently have vacancies primarily at the services and sales people, engineers and engineer technicians and administrative services levels (Figure 13.14). No vacancies were reported at the education providers and health professionals levels.

Figure 15.8 CURRENT VACANCIES —TRADE


Survey respondents also noted that, over the next five years, they are likely to create the most positions at the other occupations, services and sales people and administrative services levels. Respondents did not indicate that they would create positions at the education providers level (see Figure 15.9).

Figure 15.9 POSITIONS CREATED OVER THE NEXT FIVE YEARS — MANUFACTURING




Respondents were asked to comment on factors that constrained wholesale and retail trade organisations from hiring additional staff.

• 31.5 per cent identified a lack of financial resources (compared to 26.5 per cent

for all survey responses)

• 13.9 per cent identified a shortage of good candidates (compared to 19.9 per cent overall)

• 9.9 per cent highlighted difficulty in attracting good candidates (compared to

13.6 per cent overall)

• 2.9 per cent nominated difficulty in attracting good candidates to the organisation’s location (compared to 6.9 per cent overall)

• 48.5 per cent identified that they were happy with the number of staff they

currently employed (compared to 44.4 per cent overall).

These findings suggest that wholesale and retail trade establishments are generally less constrained in hiring new employees than the broader economy as a whole.

Respondents also noted the change in quality of recruits in the manufacturing sector by nationality compared with two years ago. Approximately 1 per cent of respondents indicated that the skills levels of Bahraini and non-Bahraini recruits had reduced over this period. Considerable proportions of respondents, however, specified that recruits exhibited higher standards of technical and/or generic skills compared with two years ago (see Figure 13.16). The quality of non-Bahraini recruits is generally seen to have improved to a greater extent than Bahraini recruits.

Figure 15.10



Trade respondents rated the importance of skills they look for when hiring employees on a scale ranging from not important to very highly important. Customer communication was rated the highest, followed by work communication, literacy skills and numeracy (see Figure 13.17). Trade employers rated planning skills and problem-solving skills as the least important.



Figure 15.11 IMPORTANCE OF WORK-RELATED SKILLS — TRADE


Trade organisations also identified the top five skills required in the sector, which are outlined in Table 11.6. The most commonly identified skill required in the wholesale and retail trade sector was communications skills (27 per cent of total responses), followed by customer service (13 per cent).

Table 15.4

TOP FIVE SKILLS — TRADE



Customer service 13%

Sales skills 11%

Technical skills 9%



Employee survey

The employee survey comprised 92 participants from the trade sector. These were predominantly male (73.9 per cent) and born outside of Bahrain (70.7 per cent). A majority of trade sector participants (60.9 per cent) earned between BD50 and BD299 per month. About 10 per cent reported earning more than BD700 per month. In comparison, 36.6 per cent of all employee survey respondents reported earning between BD50 and BD299 per month, while 23.1 per cent reported earning more than BD700 per month. This would suggest that earnings in the trade sector are lower overall than other sectors.

When asked to describe their current occupation, a majority of trade sector participants (53.3 per cent) nominated ‘service and sales’. A further 15.2 per cent selected ‘administration services’, while 13.0 per cent chose ‘manager’.



With regard to the duration between completing education and commencing work, the three largest responses were:

• immediately after completion (27.2 per cent)

• within three months of completion (21.7per cent)

• already employed (19.6 per cent).

Approximately 10 per cent of trade sector participants declared that they had taken two or more years to commence work after completing their education.

When asked to report the industry they worked in prior to their current position, 32.6 per cent nominated trade, and a further 9.9 per cent selected business services.

Employee survey respondents also commented on the skills they see as important for their jobs (now and in the future). On average, respondents highlighted that physical skills, customer communication skills and planning skills were highly important. This skills set appears to be typical of the trade sector generally.

In response to a question asking the extent to which a selection of factors influenced the decision of employees to take a job in trade, factors related to remuneration, work environment and work-life balance were highly influential on average (between 3.46 and 3.90 out of 5) for those working in the sector, as shown in Figure 15.12.

Figure 15.12 ATTITUDES ABOUT WORK — TRADE


Establishments survey 2006

In their survey of Bahraini establishments, the Central Informatics Organisation and the Labour Market Regulatory Authority (2006) asked whether there had been ‘any difficulties in employing certain professions during the year 2005’. 13.3 per cent of ‘trade and repair’ establishments reported facing difficulties – the third lowest response (after ‘electricity, water and gas’ and ‘restaurants and hotels’), and significantly less than health-related (51.7 per cent), ‘transportation, storage and communications’ (30.2 per cent) and ‘educational institutions’ (26.8 per cent). This indicates that compared to most sectors, it is relatively easier to find suitable employees in trade.



The 2006 survey also asked establishments if they had any plans ‘to increase their workforce during the upcoming 12 months’. 31 per cent of ‘trade and repair’ establishments indicated that they had such plans – the second lowest response (after ‘electricity, water and gas’), and lower than educational institutions (69.0 per cent), ‘construction’ (49.1 per cent) and health-related (44.8 per cent). This suggests more modest employment growth in the trade sector relative to other sectors.


Two key findings emerged from the stakeholder consultations. First, recruiting and retaining staff is a major problem in the wholesale and retail trade sector.

• The Bahrain Chamber of Commerce and Industry (BCCI) indicated that a key

challenge was the low opinion of trade as a meaningful and long-term career — particularly amongst Bahrainis. This view was confirmed at the Regional Conference on Skills Gaps (November 2008). Given that retail trade is one of the biggest employers for young people, the Conference determined that it is important to encourage and raise awareness of the retail industry as offering long-term career opportunities. The development of excellence in customer services and professionalism should be viewed as important skills.

• The BCCI also noted the high rate of turnover in trade. Staff undertake training

and subsequently exit the sector. The BCCI suggested that retail companies should give employees realistic expectations of what each job entails before training. The BCCI also indicated that succession planning could be used as motivation to help retain staff in trade.

• The General Federation of Bahrain Trade Unions advised that the low salaries

in the retail sector do not attract Bahrainis, hence there is a high proportion of foreign workers.

• BIHR advised that it provides courses in retail, food and beverage and

hospitality. There are over 400 students and 60 per cent are women. Students are paid a BD60 stipend to attend classes. The payment of a stipend suggests that the lure of prospective employment in the trade sector is of itself not a sufficient incentive to attract students.

The second key finding is that students entering the trade sector are not currently prepared to undertake training and have limited, basic skills. Ashrafs, a department store with 250 staff (41 per cent of whom are Bahraini), stated that there is a need for retail skills in: retail management and floor management; technical repairs; sales; store keeping; logistics; and merchandising. While there is a need to develop career opportunities for students, there are however significant problems related to work ethic and English language proficiency.


The results from the employer survey suggest that:

• companies in the wholesale and retail trade sector are finding it somewhat harder to attract quality staff, though not as difficult in comparison with all sectors generally

• finding good candidates appears to be less of a constraint on hiring for

companies in trade, compared with all sectors generally



• quality of recruits in trade has improved over the past two years though this improvement is slightly less than that of all sectors generally.

The trade sector has shortages in three key areas as discerned from the findings of the labour market analysis, surveys. These areas are in:

• retail customer service skills

• human resources skills — to assist in career development and retaining

employees within the trade sector

• soft skills — including motivation to work in the trade sector (especially for Bahraini employees) and to enhance this motivation, attracting skilled candidates to jobs within the sector.



• 7 000 scientist or engineering technicians

• 5 200 other trade positions

• 3 000 managers


• 1 800 business professionals.

Overall, these findings imply that the skills gap facing the wholesale and retail trade sector is less pressing than other sectors, though there is clear room for improvement in the general skills profile of new recruits.

For most positions in the trade sector, secondary/primary level qualifications are required. The employer survey results, however, suggest that there may be more demand for qualifications at the Certificate/Diploma and Bachelor Degree levels.

Employee survey respondents also commented on the skills they see as important for their jobs (now and in the future). On average, respondents highlighted that physical skills, customer communication skills and planning skills were highly important. These responses varied slightly to those of employer survey respondents. On average, they tended to place greater emphasis on customer and work communication skills, literacy skills and numeracy skills.

The key skills gaps identified for the trade sector are summarised in Table 15.5, including the sources from where the skills gaps have been highlighted.



Table 15.5 SKILLS GAPS SUMMARY — TRADE SECTOR

Study input

Soft skills Human resources skills

Retail customer service skills

Labour market analysis ü û û Qualifications analysis û û û Survey of employers ü û û Survey of employees ü û û Survey of graduates û û û Survey of Education Institutes û û û Key stakeholder consultations ü ü ü

Other information sources û û û


15.5 SWOT snapshot

On the basis of the analysis above, a snapshot of the strengths, weaknesses, opportunities and threats to the trade sector in Bahrain has been completed (see Table 15.6). This summarised information will be used to inform action plans for a small number of sectors in Report 4.

Table 15.6 SWOT — TRADE

STRENGTH WEAKNESS • Breadth of educational and training institutes able to

service the trade sector. • Careers in trade generally have a low threshold for entry in

terms of required skills. Consequently, the skills gap facing the sector is less acute than others.

• Given trade’s importance as a source of employment, the sector should be able to command sufficient attention from authorities for desired reforms.

• Bahrain’s location and relationship vis-a-vis Saudi Arabia.

• Unfavourable Bahraini perceptions of trade as a viable career choice.

• Low remuneration levels, which undermine recruitment and retention objectives.

• Male dominance of trade may discourage females from participating in the sector.

OPPORTUNITY THREAT • Increased female participation as a means of meeting

demand for part-time work and expanding the overall Bahraini workf orce.

• Improved collaboration across the sector, given wide agreement on the nature of the problems, and clear benefits from concerted action.

• Global financial crisis and potential downturn in the luxury retail market .

• Increased employee training may exacerbate retention objectives, as staff use their new skills to secure employment in other sectors.





There is an over-riding issue of unfavourable perceptions among Bahrainis about working in the trade sector. This extends to a perceived lack of career pathways.

Males and non-Bahraini’s dominate the trade sector. However, the males and females are undertaking training at the Bahrain Institute of Hospitality and Retail in relatively equal numbers. This could suggest that trained women will find it more difficult than trained men to obtain employment in retail. Or, the relatively even participation of women and men could be an encouraging sign for the future, including a steadily increasing proportion of trained Bahraini women working in the trade sector.

Women may be particularly attracted to this sector if it is viewed as offering employment flexibility and ‘family friendly’ workplace policies. Such policies may include the availability of part time work. Retail is well suited to offering part time employment, given the peaks and troughs in demand that occur during the retail cycle.

There are some relatively specific skills that require further development in this sector. For example, in advanced customer service, English proficiency, retail management, merchandising and technical skills. While there may be a supply of training for these skills, this does not necessarily mean that Bahrainis are choosing to undertake this training in sufficient numbers. Those who undertake training in English language may choose to use this in other employment rather than retail. It would appear that this dilemma may only be resolved by addressing the perceptions that make trade a less attractive employment option than other sectors. Otherwise, trade will continue to rely heavily on non-Bahraini labour.

Remuneration is often relatively low in trade compared to other sectors, both in Bahrain and elsewhere. Given that secondary level education is generally viewed as being sufficient for many of the jobs in trade, it is perhaps inevitable that wages will continue to be relatively low for many jobs. However, if the skill level of trade employees overall increases overtime, remuneration would be expected to rise commensurate with this. The determinants of wage levels in any sector are however relatively complex, and can vary significantly between individual workplaces. Remuneration could be considered further in a collaborative cross-industry trade forum referred to below

The retail component of the trade sector in Bahrain has been expanding through large-scale mixed-use facilities. These developments embody the internationalisation of retailing, and retail brands. Many of these brands target the luxury end of the retail market. These brands could be adversely affected by the global economic downturn, which is expected to continue during 2009. This would not only impact on employment in Bahrain, but on other nations of the region, who have undertaken similar developments.



Part D

Sectoral and skills gaps analysis — petrochemicals and banking and finance



Chapter 16

Petrochemical Sector

16.1 Characteristics of sector

Petroleum and natural gas are the most significant natural resources in Bahrain. Bahrain was the first Gulf state to discover oil and the Sitra refinery was the first established in the region. As a consequence, petrochemicals have been an important component of Bahraini commerce and employment for the past 75 years.

Table 16.1 PRODUCTION (1,000 U.S.BARRELS) 2003–2007

Details 2003 2004 2005 2006 2007 1. Crude oil 68,866 68,585 68,096 66,908 67,262

Bahrain Field 13,720 13,647 13,348 13,085 12,552

Abu Saa fa Field 55,146 54,938 54,748 53,823 54,710 2. Gas* 434,537 428,375 470,413 487,932 507,671

3. Refinery 92,350 92,669 97,716 96,217 97,904

4. Gas Liquids 3,590 3,799 3,863 3,704 3,503

Propane 1,021 1,032 1,065 1,010 944

Butane 922 981 1,015 969 896

Naphtha 1,647 1,786 1,783 1,725 1,663 5. Petrochemical** 1,317 1,287 1,338 1,482 1,373

Ammonia 380 379 401 451 417

Methanol 370 398 376 406 371

Urea 567 510 561 625 585

* million cubic feet ** thousand metric tons Source: National Oil and Gas Authority (NOGA) 2008

Petroleum continues to provide approximately 60 per cent of Government revenues and underpins much of the social and economic policy of the Bahraini government. The petroleum sector is a key driver of the “Bahrainisation” of the workforce. Approximately 85 per cent of employees in the petrochemical industry are Bahraini.

The industry is dominated by four operating companies; the Bahrain Petroleum Company, Bahrain National Gas Company, Gulf Petrochemical Industries Company and the Bahrain Aviation Fuel Company. The Bahraini government wholly or partly owns all. The government’s investment in these companies is managed through a holding company owned by the National Oil & Gas Authority. Table 16.2 describes employment numbers across these four companies.



Table 16.2 TOTAL MANPOWER IN OIL SECTOR AS AT THE END OF DECEMBER 2007

Company name

Bahraini Non-Bahraini Total

No. % No. % The Bahrain Petroleum 2,679 83 533 17 Company (BAPCO)

Gulf Petrochemical Industries 358 83 72 17 Co (GPIC)

Bahrain National Gas Co 366 94 22 6 (BAN AG AS)

The Bahrain Aviation Fuelling 105 98 2 2 Co. (BAFCO )

3,212

430

388

107

Total 3,508 85 629 15 4,137

Source: National Oil and Gas Authority (NOGA) 2007

The industry has a high level of inter-dependency as is reflected in Figure 16.1.

Figure 16.1

BAHRAIN PETROCHEMICAL OPERATIONS

Source: BAPCO 2008

There are a small number of private companies that operate in the petrochemical industry, but none have significant operations. Several foreign companies have representative offices in Bahrain, but seconded expatriates primarily hold senior management positions.



16.2 Petrochemicals in Bahrain

National Oil & Gas Authority (NOGA)

NOGA was established in 2005 with a charter to be responsible for all petroleum and gas related issues. NOGA’s objective is to maintain and develop Bahrain’s oil and gas resources for generation of the highest return to Bahrain financially and socially. It is responsible for establishing and managing all regulatory issues pertaining to the industry. Additionally, it manages and develops relationships with foreign governments and companies on oil and gas related matters.

In 2007, the Bahrain Oil and Gas Holding Company was established as a wholly owned subsidiary of NOGA to acquire and manage the Government’s shareholdings in petroleum companies. Additionally, the interests of the Bahraini government through their participation in the Organisation of Arab Petroleum Exporting Countries (OAPEC) were also allocated to NOGA Holding. Bahraini ownership of these companies varies from 1 per cent to 18.5 per cent. Figure 16.2 depicts the NOGA structure.

Figure 16.2 NOGA STRUCTURE

Source: http://www.noga.gov.bh

NOGA’s regulatory role includes the setting of domestic pricing of petroleum products (gasoline, diesel, asphalt, etc) to Bahraini and non-local users. Petroleum pricing is a fundamental pillar of social and economic policy and as a consequence is subsidised for use in the domestic economy.

NOGA performs an administrative role in the petrochemical industry. In 2008, a Code of Conduct was implemented to ensure NOGA-administered companies act:

• with social responsibility

http://www.noga.gov.bh



• with respect for religious beliefs

• with safe work practices

• with respect for the environment

• with respect for the individual and their confidentiality

• with professional ethics.

NOGA must also ensure that effective succession planning is implemented in its companies to ensure Bahraini’s can assume key positions in petroleum companies.

In recent years, NOGA has been very active in strengthening international relationships. Talks and agreements have been put in place with Iran, Egypt, Thailand and Qatar on various oil and gas matters.

Bahrain Petroleum Company (BAPCO)

BAPCO is the largest company operating in the petrochemical industry in Bahrain. At December 2007, it employed approximately 85 per cent of all people employed in the petrochemical industry in Bahrain. BAPCO is a vertically integrated company with operations in oil and gas exploration and production, oil refining, distribution, and domestic and international sales. BAPCO is wholly owned by the Government of Bahrain.

Exploration and production

Oil and gas production in 2007 was 34,389 barrels per day (bpd) of oil and 1.39 billion cubic feet per day (bcfd) of gas. Additionally, Bahrain was entitled to 149,890 bpd (50 per cent share) from the Saudi Arabia’s Abu Saafa field. Oil production has been comparatively stable for several years, but gas production has been increasing by approximately 5 per cent per annum in recent years.

Production of both oil and gas is expected to rise significantly over the next few years with an intensive program of enhanced oil recovery and the award of offshore exploration acreage to prominent international petroleum companies.

In-field drilling using advanced horizontal and directional drilling and fracturing at the existing on-shore facilities is expected to stabilise and then increase oil production from these fields. The program will be undertaken by 11 international companies. The expectation is that production will increase to approximately 70,000 bpd within a few years.

Additionally, four offshore exploration blocks were gazetted and offered in 2007. The offering attracted interest from eighteen international companies and three of the four blocks were awarded for the offshore regions surrounding Bahrain. The winning bidders, Occidental (a large US oil company) and PTTEP (the exploration arm of the national oil company of Thailand), have committed to a seven year program involving seismic processing and a multi-well exploration drilling program. As a consequence, Bahraini oil production is expected to increase to up to 100,000 bpd in the short-medium term.



Similarly, gas production could be expected to increase significantly. A re-working of the Khuff gas development has commenced. This program alone should increase gas production by 0.5 bcf per day in the next few years and is budgeted to cost approximately US$200 million. The offshore drilling program may also yield gas discoveries.

Refining and marketing

The Sitra refinery is one of the largest refineries in the Middle East. It processes all Bahraini domestic crude production, plus receives approximately 220,000 bpd of Arab Light by pipeline from Saudi Arabia. The 2007 throughput was 260,720 bpd. Sitra produces a full range of refined products rich in highly valued middle distillates (diesel and jet kerosene).

Figure 16.3

REFINED PRODUCT PRODUCTION

Source: BAPCO 2008

Products are exported to markets worldwide as referred to in Figure 16.4.

Figure 16.4

DESTINATION OF PRODUCT EXPORTS

Source: BAPCO 2008



The inauguration of the low sulphur diesel production complex (LSDP) in late 2007 was a key recent development. The US$725 million plant enables the refinery to produce ultra-low sulphur diesel. The design sulphur content has fallen from 7000 parts per million to only 10 ppmm. This specification exceeds the EuroV specification and allows the refinery to supply any market worldwide. The LSDP was the main element of BAPCO’s Strategic Investment Program (SIP). It is expected to generate annual incremental revenue of approximately US$300 million, and be the cornerstone of additional upgrades and market opportunities.

New projects

In addition to the exploration program detailed above, BAPCO has an impressive list of new projects under consideration or in process. The intent of these projects is to broaden the scope of BAPCO’s involvement in the international petrochemical business.

Product storage

Construction of a 500,000 cubic metre, US$95 million storage facility near the Sitra refinery as a merchant tank-farm and to enable expanded trading opportunities. The project would diversify BAPCO’s income and enhance Bahrain’s supply security.

Pipelines

A US$300 million program to replace and relocate the oil pipeline from Saudi Arabia.

Lube base oil

A proposal to produce lubricants and specialty oil for the European and North American markets. The US$400 million project is a joint venture with Neste Oil

Refinery gas desulphurisation

This US$155 million project reduces the sulphur emissions from the Sitra facility thereby improving the quality of air and water emissions.

Sulphur pelleting plant

A consequence of the LSDP project was a significant increase in sulphur capture. The US$37 million sulphur pelleting plant converts the sulphur into a product that enables it to be marketed into the lucrative agriculture fertiliser market.

Several additional projects are intended to increase infrastructure to improve Bahrain’s competitive position. Among these projects are a US$70 million project to upgrade power generation at Sitra, a US$120 million sewage treatment plant and a US$260 million proposal to process off-gas from the refinery and associated oil field gas. The gas project could significantly increase availability of gas and convert a waste product into a valuable product.

Bahrain National Gas Company (BANAGAS)

BANAGAS extracts gas liquids (propane, butane and naphtha) from the raw gas stream and distributes natural gas to domestic customers and gas liquids to international and domestic customers. The company is owned 75 per cent by the Bahraini government, 12.5 per cent by Chevron and 12.5 per cent by the Arab Petroleum Investment Corporation (APICORP).



Figure 16.5 DISTRIBUTION OF GAS CONSUMPTION FOR THE YEAR 2007 (BILLION CUBIC FEET)


Figure 16.6

GAS LIQUIDS 2007 PRODUCTION


LPG production in 2008 increased by approximately 25 per cent due to increased field and refinery production.

Until late 2003, all international marketing of gas liquids was handled by Chevron. Since then, BANAGAS has been responsible for marketing and logistics. In addition to large refrigerated shipments, Bahrain has one of the few Middle East facilities capable of loading LPG pressure ships. This has enabled BANAGAS to be an important supplier to this high value market.

The aggressive expansion of gas and oil exploration and production by BAPCO will result in greater activity by BANAGAS. Studies are underway to examine de-bottlenecking and expansion operations to respond to this greater gas flow. Most of these expansions will be undertaken by the 100 per cent Bahraini government owned BANAGAS Expansion Company. As a consequence, an increasing amount of gas operations will fall under direct Bahraini control and ownership.

Gulf Petrochemical Industries Company (GPIC)

GPIC is one of the largest petrochemical operations in the Middle East. GPIC is a joint venture company equally owned by the governments of Bahrain, Kuwait (Petroleum Industries Company) and Saudi Arabia (Saudi Basic Industries Corporation). Operations are solely based in Bahrain processing local natural gas into ammonia, urea and methanol (see Figure 16.7).



Figure 16.7 PETROCHEMICAL PRODUCTION, 2007


Most of the ammonia is converted into urea. While a small amount of urea is sold in Bahrain, the facility is primarily export-focused supplying much of Singapore’s methanol requirements, and large fertiliser users in USA, Australia and India (see Figure 16.8).

Figure 16.8

GPIC 2007 EXPORT SALES

Source: GPIC 2007

Despite the downturn in world economic activity, GPIC traded profitably in 2008. They are well positioned to capture additional opportunities. GPIC are optimistic that additional gas will become available as a result of the aggressive exploration and enhanced recovery program instigated by BAPCO. GPIC note that while the GCC have large gas reserves, it supplies only 7 to 10 per cent of the world fertiliser market. Conditional on the availability of an increased supply of gas at world competitive prices, GPIC aim to increase the penetration of the fertiliser market.

Bahrain Aviation Fuelling Company (BAFCO)

BAFCO is responsible for all fuelling operations at Bahrain International Airport. It receives fuel from the Sitra refinery by pipeline, operates the storage facility and executes all refuelling activities at the airport. BAFCO is owned 60 per cent by BAPCO, 27 per cent by Chevron and 13 per cent by BP Air. BAPCO, Chevron and BP market to airline customers separately. BAFCO does not undertake marketing activities and operates as a service arm of its owners.

Operations have been rising steadily in recent years (see Figure 16.9).



Figure 16.9 BAHRAIN INTERNATIONAL AIRPORT JET FUEL SALES


BAFCO operate a 24-hour refuelling program with virtually a total Bahraini staff. Training and development is crucial because of the paramount necessity of a safe and efficient operation. All BAFCO staff are required to undergo regular safety courses.

16.3 International trends in petrochemicals

The global financial crisis and the sharp downturn in commodity prices and refining margins may present an opportunity for Bahrain to increase its presence in the value-added segment of the petrochemical industry. The severity of the GFC and its knock-on effect on the availability of credit will cause many potential developers to delay or cancel investment plans. This is a myopic response to the fundamentally positive outlook resulting from the medium-long term growth prospects of China, India and the Persian Gulf due to increased per capita growth. Provided the current program of in-field drilling and exploration is successful, Bahrain could capture significant value added opportunities.

Impact of the global financial crisis

The two key responses to the GFC have been a shrinking of the availability of credit and reduced demand for commodities. The responses are inter-related. A consequence of the number of AA-rated banks falling from 20 in September 2008 to 12 by the start of February 2009 is that syndication of debt is very difficult for lenders to arrange. Similarly, uncertainty of the quality of debt has impacted greatly on trade financing. These have impacted on both the current volume of trade, and a slump in the outlook for demand for commodities. Projects are being delayed or cancelled. A sovereign investor like BAPCO, BANAGAS or GPIC represents a far more secure risk to lenders, and therefore could be advantaged relative to multinational oil companies.



Declining refining and petrochemical margins

The refining and petrochemical industries experience long lead times between conceptualisation of the project and commissioning. As a consequence, projects spurred by high margins and a buoyant economic outlook in the 2004 to 2007 period are now being commissioned. A probable outcome will be a fall in margins as increased production is placed into a shrinking market. The International Energy Agency (IEA) predict that crude distillation capacity will increase by 2 million barrels per day (mmbd) in 2009 and 1.6 mmbd in 2010. This contrasts with their estimate of demand falling by 1 mmbd in 2009. This followed a 0.4 mmbd fall in 2008. The gloomy market conditions will result in reduced investment. Even the IEA forecast of refinery capacity increases of 1 mmbd in each of 2011-2013 might be optimistic in the conditions.

The refinery industry is renowned for its “boom and bust” history. A far-sighted investor could be well positioned for the next boom when the Chinese and Indian economies return to strong growth. The huge populations and low per capita use of petroleum means that when strong economic growth in these countries resumes, petroleum product growth is amplified. This presents an opportunity for a financially secure investor.

Carbon price

The election of President Obama has heralded a change in the US attitude to carbon pricing. As a consequence, coal fired electricity will be pressured relative to gas, nuclear and renewable fuels. Inclusion of the price of carbon in the variable cost of production will advantage Bahrain’s gas based industries. It could also result in Bahraini gas and wind-powered expansions being able to sell carbon credits to high emitting projects elsewhere in the world.

Tightening product specifications

More countries are adopting Euro IV, V and VI specifications on gasoline and diesel fuels. Of particular relevance is the limitation on sulphur content. Meeting this specification through increasingly severe sulphur recovery is expensive. Ultra low sulphur diesel can be produced from natural gas using a Fischer-Tropsch process. While being more capital intensive than conventional refining, the higher upgrading margin of gas relative to oil, and the premium for zero sulphur content, could make the investment attractive.



“Peak Oil”

High oil prices between 2005 and mid-2008 provoked a spirited debate about “peak oil” and whether the world was approaching a point in time where oil supply could not match demand. Oil demand increased at approximately 1 mmbd per annum (365 million barrels per annum) from 2000 consumption of 76 mmbd. Consumption in 2008 totalled over 31 billion barrels. Oil discoveries are thought to be much lower than this level. Industry experts debated when “peak oil” would occur. Various experts opined the timing would be somewhere between 2005 and 2030, with many suggesting the 2012 to 2018 period. Even with a downturn in consumption experienced in the past year, the timing of this peak would only be delayed by one or two years. On this basis, oil, and to a lesser extent, gas remains a commodity that is becoming increasingly scarce. Its pricing will reflect this. It would make sound economic sense to implement investment programs to capture the “scarcity premium”.


This section presents data and information relating to the future skills needs in the petrochemical sector in Bahrain. The data is presented based on:

• economic forecasting and modelling of GOSI, LMRA and NOGA data

collections

• surveys of the major petrochemical employer organisations

• face-to-face consultations with the key government and employer stakeholders in the petrochemical sector, and education and training providers.

Employment forecasts and modelling

Number of employees, 1995-2007

Figures from the General Organisation for Social Insurance (GOSI) indicate that the total number of employees in the petrochemical sector grew from 3302 in 1995 to 3910 in 2007. By 2007, the number of Bahrainis had increased from 2733 to 3193, which was 82 per cent of all employees (National Oil and Gas Authority (NOGA)

9

2007). In 2007, Bahraini males made up 76 per cent of all employees. There were 173 (5 per cent) female employees in 1995. This increased to 303 (8 per cent) in 2007, when Bahrain females constituted 74 per cent of female employees. As Figure 16.10 highlights, the growth in the number of workers has been slow relative to the overall labour market. The average annual growth since 2002 in the petrochemical sector was 4.55 per cent compared with an overall annual average growth in employment in Bahrain of 9.9 per cent. The proportion of Bahrainis in the sector has fallen slightly in recent years (from 84 per cent 2002 to 82 per cent in 2007), while in the same period, the proportion of female employees has remained stable at just under 8 per cent.

9 Note: National Oil and Gas Authority (NOGA) reports a total manpower of 4,137 as at the end of December 2007 and Bahrainisation rate of 85 per cent.



Even though there has been a greater rate of growth (15.9 per cent since 2002) in the number of non-Bahrainis employed in the petrochemical sector relative to that of Bahrainis (two per cent), it needs to be borne in mind that compared with other sectors in the Bahrain economy, the petrochemical sector in Bahrain still employs relatively few non-Bahrainis: 18.3 per cent of employees in the sector in 2007 were non-Bahraini, compared with 70 per cent non-Bahraini employees overall. The Bahraini petrochemical sector also employs a much higher proportion of nationals than its counterparts in other GCC countries. According to NOGA, Bahrainisation in the petroleum sector is the highest in the Kingdom and one of the highest in the GCC oil and gas industry.

The high rate of Bahrainisation in the sector can be attributed to its strong commitment to training and employing Bahrainis. The sector (and in particular its major employer, BAPCO) has played a pivotal role in the development of Bahraini technical and managerial expertise over the past 60 years, ensuring that sector has a reliable supply of highly specialised and well trained professional engineers, managers and technical staff appropriate to its needs. Moreover, many of the nation’s leaders in both public and private sectors were the beneficiaries of BAPCO apprenticeships, scholarships and in-house training programs.

Figure 16.10

EMPLOYMENT TRENDS, BAHRAINI AND NON-BAHRAINI, PETROCHEMICALS, 1995- 2007

Source: General Organisation for Social Insurance, GOSI, 2009; Eidos

Growth rates in the number of employees in the sector have remained consistently low, although the data show some break in the series in 2000 to 2001.

Projected number of employees, 2012

The following projections are based on the assumption that recent linear trends in numbers will be maintained on average over the next 5 years. These projections indicate that in 2012 there will be a total of 4101 employees in the petrochemical sector with 3290 Bahrainis and 811 non–Bahrainis. These projections indicate an increase of 4.9 per cent.



If the country and the petrochemical sector continue along current lines, employment in the sector can be expected to decline as a share of total employment from its present figure of 1 per cent.

Figure 16.11

ACTUAL AND PROJECTED EMPLOYEES IN THE PETROCHEMICAL SECTOR, 1995-2012

Source: General Organisation for Social Insurance (GOSI), 2009; Eidos

Projected needs — by qualifications

Using the projections above and the profile of qualifications in the sector provided by GOSI, Table 16.3 and Table 16.4 show the existing and the required employee profiles of the sector by level of education. Assuming the sector and the country continue along current lines, these indicate that to retain the current qualifications profile of the petrochemical sector, an additional 31 people with Bachelor or above degrees will be needed, with 9 to come from the Bahraini population. At the secondary level, petrochemical activities are likely to employ an additional 18 with a secondary diploma, and 48 with completed secondary studies. It is also estimated that an additional 94 employees with intermediate or below education levels will be required by 2102.

Table 16.3

QUALIFICATIONS, PETROCHEMICAL SECTOR, 2007

Bahraini Non-Bahraini All employees PhD 2 1 3

Master 12 16 28

High Diplomas 1 3 4

Bachelor 274 357 631

Secondary Diploma 286 79 365

Secondary 906 65 971

Other 1712 196 1908 Total 3193 717 3910

Source: General Organisation for Social Insurance 2009; Eidos.



Table 16.4 REQUIRED QUALIFICATION LEVELS, PETROCHEMICAL SECTOR, 2012

Bahraini Non-Bahraini All employees PhD 2 1 3

Master 12 17 29

High Diploma 1 3 4

Bachelor 282 379 661

Secondary Diploma 295 88 383

Secondary 934 85 1019

Other 1764 238 2002 Total 3290 811 4101

Source: General Organisation for Social Insurance 2009; Eidos.

Projected needs — by occupation

Table 1.5 shows the occupational status of Bahrainis and non-Bahrainis employed in the petrochemical sector in 2007. As note above, based on historic trends, the number of employees in the petrochemical sector is not expected to grow significantly - an increase from the GOSI figure of 3910 in 2007 to 4101 is predicted.

Table 16.5

OCCUPATIONS, PETROCHEMICAL SECTOR, 2007

Occupation Bahrainis Non-Bahraini Total Managers and business executives 66 11 77 Scientists and science technicians 66 14 80 Engineers and engineering technicians 381 180 561 Health professionals 36 58 94 Education providers 4 5 9 Business professionals 142 237 379 Administrative services 281 39 320 Services and sales 191 35 226 Construction Other occupations 2026 138 2164 Total 3193 717 3910

Source: Allen Consulting Group and Eidos

Table 16.6 shows the required occupational levels for the sector based on modelling for 2012.



Table 16.6 REQUIRED OCCUPATIONS, PETROCHEMICAL SECTOR, 2012

Occupation Bahraini Non-Bahraini Total Managers and business executives 70 11 81 Scientists and science technicians 70 15 85 Engineers and engineering technicians 396 190 586 Health professionals 38 60 98 Education providers 4 5 9 Business professionals 149 248 397 Administrative services 291 44 335 Services & sales 200 37 237 Construction Other occupations 2072 201 2273 Total 3290 811 4101

Source: GOSI, BAPCO, GPIC, BANAGAS, BAFCO; Eidos

As indicated earlier, one of the largest occupational groups in the petrochemical sector is that of engineers and engineering technicians. It is within this group that the greatest demand and largest number of vacancies exist (about 150 vacancies currently vacant and 586 positions needed in 2012). From Table 16.6 it can be noted that there is a large number of occupations classified as “Other”. Stakeholder consultations and an analysis of GOSI classifications indicate that about 32 per cent of those classified as “other” are manual workers, 25 per cent are plant operators, and 16 per cent are trainees.

Employer surveys and stakeholder consultations

Given that there are only four employers in the petrochemical sector, the information available for employer surveys is limited. The four responses received are representative of the sector. Consultations and surveys covered the entire sector and included the Minister for Oil and Gas Activities (HE Dr Abdul Hussain bin Ali Mirza), the senior management of the National Oil and Gas Authority (NOGA) and the four petrochemical companies (BAPCO, GPIC, BANAGAS and BAFCO).

The survey asked a range of questions of each employer regarding the company’s existing skills profile, vacancies, recruitment difficulties, skills gaps and training activities. Consultations sought information about government and industry policy and development plans and their implications for future skill requirements.



His Excellency, the Minister for Oil and Gas Affairs indicated that a much higher priority is now being given by the Government to the development of the petroleum sector. By reducing its dependence on oil revenues for funding recurrent expenditure, the Government is planning to invest oil revenues in ways that will ensure the future prosperity of all Bahrainis. By investing in the use of new technologies to explore and develop its oil and gas resources and to enhance oil recovery, Bahrain hopes to double its output from 35,000 bpd to 70,000 bpd. Improving the skills and efficiency of Bahraini workers and “raising standards and performance in our schools, vocational institutions and universities” are also major elements in Bahrain’s economic strategy for 2009–2014 (Kingdom of Bahrain 2008).

His Excellency, the Minister argues that even though the Bahrain economy has become increasingly diversified, the petrochemical sector will continue to be the bedrock on which development is based: the sector still accounts for two-thirds of government revenue and one quarter of GDP. Moreover, the sector is well known for the strength of its workforce, its capacity to keep abreast of state-of-the-art technologies and for meeting the stringent safety and environmental standards demanded of the sector. Petrochemical companies have been the pace setter over the past 60 years in the development of the leadership, management and technical capacity of the Kingdom.

The National Oil and Gas Authority (NOGA) is the government agency responsible for oil and gas policy and development, and it works with the petrochemical companies to build training systems and succession plans to develop the talents of their employees. NOGA reports that the number of trainees was 1,883 (54 per cent of its workforce). The budget allocated for the training was BD 8.34 million (i.e. over US$7800 per employee per annum). Given the magnitude of upcoming projects in the petrochemical sector, NOGA sees the need to redouble the efforts being made to upgrade the skill base of employees and to create, via scholarships, a pool of well qualified graduates to meet anticipated needs.

The largest, oldest and most influential employer in the sector is the Bahrain Petroleum Company. The company has played a key role in the development of the Kingdom, and particularly in the development of its human resources. BAPCO’s Apprenticeship Training Scheme became the cornerstone of its Bahraini advancement program.

The company’s enduring commitment to training and succession planning is impressive. For BAPCO, the greatest problem lies in recruiting engineers (especially chemical and petrochemical engineers) and engineering technicians – as noted above there are currently 144 vacancies for positions in these fields, 69 for business professionals, 65 for business services and 28 for health professionals. To help fill these skills gaps, BAPCO continues to provide over 300 scholarships for Bahrainis to study at the University of Bahrain and abroad. Its Skills for the Workplace Training Programme trains young Bahrainis to perform engineering and administrative functions, and its courses offer opportunities for Bahrainis to qualify for UK National Vocational Qualification certification.



For BAPCO, it is important to have multi-skilled staff, and to involve its employees in the design and implementation process of new plants such as the low sulphur diesel production complex. BAPCO is also pressing ahead with an ambitious in- house human resource management and training program, and the development of a fully-fledged apprenticeship scheme with a target of 1,000 apprenticeships.

The Gulf Petrochemical Industries Co (GPIC) is recognised as one of the best manufacturing companies in the Arabian Gulf attesting to the high levels of skill and experience of its operational staff. The CEO sees the Gulf as “the best placed region in the world to produce the basic petrochemical and fertiliser products” and sees GPIC as an “icon of the downstream industry that exceeds all standards on quality, safety, reliability, and social responsibility.”

Pivotal to the management style of GPIC is its reliance on the company’s human resources; the “one team” spirit drives all operations of the company. GPIC has invested heavily in updating the skills and qualifications of its Bahraini staff, increasing the level of Bahrainisation to 83 per cent. In recognition of its achievements in training and staff development, GPIC was listed first among those exempt from occupational training fees, and has won numerous awards for the excellence of its training programs.

Like other employers in the sector, GPIC is facing shortages of engineers and has approached the University of Bahrain to provide sponsorships. The company has an in-house structured training program lasting three to five years for engineers, operators and technicians, and another for the development of existing employees (e.g. supervisors). The company also sends staff to other countries for specialised training to ensure that its operations are state-of-the-art. It is concerned about the quality of candidates for technical and operations positions and has welcomed the establishment of the Bahrain Polytechnic in the hope that it will produce high calibre graduates.

BANAGAS, the Bahrain National Gas Company, is 75 per cent owned by the Government of Bahrain and was formed with the primary objective of processing associated gas into marketable products and supplying gas for local industry. When the company began in 1979, Bahraini personnel represented 48 per cent of its workforce. Extensive development and training programs have been implemented so that Bahrainis now make up 94 per cent of BANAGAS’s workforce. BANAGAS has also been able to achieve its target of maintaining the highest standards of occupational safety and health through regular training. Its safety record has been recognised internationally.

While BANAGAS is satisfied with the Bahraini staff it has been able to recruit and train, it does face some problems in attracting good quality candidates for key areas of its operations – notably engineering and engineering technicians. Moreover, it takes three to five years for graduate engineers to become fully operational in what is a highly specialised and complex technical field. The company is critical of the education and training currently being provided by institutions in Bahrain arguing that:

• engineering graduates from the University of Bahrain lack practical experience

and want the three-month practicum component to be doubled

• the technical training provided by the Bahrain Training Institute is also too theoretical and needs to be more practical



• a much more collaborative approach to the design of courses and conduct of the practicum is needed

• students leaving secondary education do not appreciate the need for stringent

safety standards, and lack the basic skills and attitudes to work needed to be employable

• generally standards are low, especially in the private universities in Bahrain,

and quality assurance and accreditation of institutions and courses need to be much tougher.

BAFCO, the Bahrain Aviation Fuelling Company, is the sole company responsible for refuelling aircraft in Bahrain, and is essentially a service provider operating on behalf of BAPCO, BP and Caltex. Aviation refuelling is subject to stringent safety and quality control procedures, and the company has an outstanding record in meeting ISO and British Standard Institute certification and KPI requirements. To do so, BAFCO staff undergo regular training and refresher courses both in-house and overseas, with employees averaging 2.4 training programs per year.

Whereas refuelling companies in other GCC states are heavily dependent on expatriate workers, BAFCO is almost entirely Bahraini (98 per cent) and most of its employees are highly skilled. The company employs Bahrainis not because they are Bahraini but because they have the necessary skills and qualifications and “we will replace a non-Bahraini only if a Bahraini meets our standards and requirements.”

In summary, consultations with key stakeholders in the petrochemical sector and responses to the employer survey indicate that:

• the pool of qualified labour from which the petrochemical sector draws its

employees is reasonably adequate in most areas with the exception of engineers and engineering technicians

• the largest anticipated future skills gap is in chemical and petrochemical

engineering, with unmet needs for Bahraini nationals with these skills likely to continue for the foreseeable future

• retention rates (95 to 97 per cent) and rates of Bahrainisation (83 to 85 per

cent) are high

• significant investments in training and development mean that skills gaps are small in comparison with other sectors

• vacancies for skilled workers are generally filled using industry contacts and

networks and direct approaches to employees, and to a lesser extent through advertisements or private employment agencies

• areas in which most employees are being hired and vacancies exist are those

demanding a high level of professional and technical engineering expertise

• hiring of additional employees is demand driven

• the major constraint facing employers in the sector is the shortage of good candidates and the difficulty of attracting them to their organisation

• good candidates are “often more likely to join service provider industries” and

government than industrial companies which generally have an image problem and less favourable working conditions for professionals



• extensive in-house and external training is needed for most new employees to be fully productive in the petrochemical sector and to improve productivity and maintain standards of employees

• a systematised national apprenticeship scheme is needed to ensure an adequate

supply of technicians and operators for the sector

• a training institute should be set up for the oil and gas industry (like BIBF for banking and finance)

• greater involvement of the industry in course design and setting standards of

industry–relevant programs in the University, BTI and the new Bahrain Polytechnic.


For the most part, projections and estimated skills gaps have been based on the assumption that conditions in the future will be similar to those operating today and in the recent past. The estimated skills gaps by educational qualifications and occupation levels that are described in Figure 16.12 and Figure 16.13 reflect this assumption. It should be noted that education level serves as a proxy for skills level required. Whereas many of the employees required in 2012 appear to be concentrated at the lower end of the labour market (i.e. “Other occupations” requiring less than a full secondary education), the “Skills Gaps” are predominantly at the middle to upper level, that is, engineers, engineering technicians, managers, scientists and business professionals requiring a degree or diploma.

Figure 16.12 ESTIMATED SKILLS GAPS IN THE BAHRAIN PETROCHEMICAL SECTOR




Figure 16.13 ESTIMATED OCCUPATION GAPS ON THE BAHRAIN PETROCHEMICAL SECTOR


The economic modelling suggests that the petrochemical sector in Bahrain is unlikely to undergo the same contraction in employment experienced by other countries worldwide and the private sectors in the Bahrain economy, particularly those with a high number of foreign workers with low skill levels (e.g. construction).

The magnitude of skills gaps in the sector and the demand for skilled labour in the future are dependent on two interacting factors:

• the global economic environment — the financial fallout from the global

recession and its impact on the demand for, and price of, oil, gas and petrochemical products (such as ammonia, urea and methanol)

• Bahraini government and petrochemical company policies, initiatives and

investments.

In the petrochemical sector, the level of Bahrainisation is high (83 per cent) and attrition rates are low (3 to 4 per cent). For the most part, the Bahrainis in professional and technical positions have the qualifications and skills required, and are provided with the training needed to upgrade their knowledge and skills. The scenario planning exercise for this project assumed a base case, negative and positive scenarios. Under scenario 2, falling demand and difficulties in achieving oil and gas price targets may lead to a modest reduction in the estimated skills gaps set out in Figure 16.13 (of the order of 5 per cent by 2012). If under scenario 3, the current economic recession proves to be short-lived and upstream and downstream investments underway begin to bear fruit, demand for skilled labour will be higher than predicted (of the order of 10 per cent).

16.6 Future pressures facing the petrochemical labour market

The main problems facing the petrochemical sector in Bahrain are:



• difficulty in recruiting good candidates with appropriate technical qualifications and experience (petrochemical, chemical, mechanical, civil engineers; engineering technicians; geophysicists; geologists; technical services, supervisors and middle level management)

• image and working conditions less favourable than Public and Banking sectors

leading to loss of highly qualified and experienced personnel

• education and training provided by existing institutions in Bahrain does not match the needs of the petrochemical section, is not industry driven

• poor quality of English, Maths, Science and Technology teaching and

shortfalls in the number of engineering and science graduates and qualified technicians

• absence of a recognised qualifications framework, and quality assurance

mechanisms yet to be effective in facilitating reforms in the education and training system aimed at raising standards and skill levels of school leavers and graduates

• uncertainty about the impact of changing economic conditions on oil prices

and demand and their impact on production requirements and the labour market

• uncertainty about future supply of oil and gas both in terms of Bahrain’s

current offshore exploration and recovery program, and from GCC neighbours

• constant upgrading of the safety, environmental and technical standards demanded of the industry and rapid advances in technologies used upstream and downstream in the petrochemical sector.

On the basis of the analyses above, a snapshot of the strengths, weaknesses, opportunities and threats to the petrochemical sector is presented below (see Table 16.7)



Table 16.7 SWOT — PETROCHEMICALS

Strength Weakness • Highly eff icient and productive

petrochemical companies and workforce • Strong leadership and managem ent

teams • Sector in Bahrain is smaller, m ore

flexible, robust than many com petitors • Majority of employees are Bahraini, wel l

qualified and highly skilled • High technical standards set and

maintained in production • Heavy investment in training and

upgrading the skills base of employees • Ambitious offshore program of

exploration and development of oil and gas reserves

• Skills gaps in specialised fields of engineering, operations and maintenance

• Low share of oil revenues reinvested had led to aging infrastructures

• Bahrain lacks a national apprenticeship scheme

• Education-training system is not aligned with the needs of the sector

• Education standards are low and school leavers lack the skills and work ethic needed to be productive

• Diff icult to attract good candidates given better conditions and status in Banking

• New employees require lengthy in- house and specialised training to be productive and innovative.

Opportunity Threat • Government and company investments

in offshore exploration, extraction, processing and new technologies will lead to dramatic increases in production, efficiency and competit iveness

• Co-ordinated and more coherent development programs link Bahrain more closely to the global and regional econom y

• Food, water and energy shortages create high demand for oil, gas and fertilisers, and for reliable sources of supply

• Education and training system fails to implement reforms: supply of quality candidates and skills gaps become more acute

• Petrochemical sector forced to seek non-Bahrainis for experience and qualifications that align to its needs

• Economic downturn depresses oil and gas prices, demand for petrochemicals weakens

• Exploration program yields are meagre and supply of Bahraini oil and gas dwindles

• Political turmoil in GCC threatens supply from neighbours


16.7 Possible solutions for Bahrain

The evidence and analysis presented in this chapter suggest that the petrochemical sector in Bahrain is likely to weather the turmoil created by the financial and economic challenges facing the sector and nations that have surfaced in recent months. The sector is well positioned to address its most pressing skills gaps, given its longstanding investments in scholarships and training, exploration and processing, and the strategic role being played by industry and government leaders.

To address the challenges confronting the sector set out above, Bahrain will need to consider providing additional support to ensure the effective implementation of initiatives being taken by Bahraini petrochemical companies. In particular, it will be necessary to:



• develop a national apprenticeship program and more targeted national scholarship program to ensure an adequate supply of technicians and engineers to meet the needs of the petrochemical sector

• develop a petrochemical-specific qualifications framework and quality

assurance accreditation system to cover technical and vocational as well as university level institutions and programs, modelled on those utilised in OECD countries and major oil and gas companies

• make course and institutional accreditation for BTI, the new Bahrain

Polytechnic, the University of Bahrain and private institutions conditional on extensive involvement of appropriate industries (such as the petrochemical companies) in the design, teaching, practicum component and standards of courses and qualifications

• set high standards for entry into, and graduation from education and training

programs and close down institutions and courses not meeting them

• invest in R&D in niche areas within the sector where Bahrain has a strategic advantage in the Gulf, and support joint venture research and training programs with institutions and centres working in these areas

• enhance co-operation with GCC countries so that Bahrain becomes the focus

of research and specialised training in these niche areas, beginning with a Centre within the new Bahrain Polytechnic or the School of Engineering in the University of Bahrain and eventually to a specialised Institute serving the GCC region

• ensure that the media, public information programs and career counselling in

education and training institutions are well informed about the opportunities available in, and the importance for Bahrain, of the petrochemical sector and work with government to improve its image

• invest in improving the conditions of work and opportunities for specialised

training, advancement and research within the sector to ensure that it attracts and retains outstanding graduates.



Chapter 17

Banking and finance


The finance and banking sector in Bahrain is significant in terms of the number of companies, contribution to the economy and number of employees. There were 415 financial institutions based in Bahrain as of December 2008 (Central Bank of Bahrain 2009b). In 2007, financial corporations in Bahrain contributed BD1 576.39 million to the country’s GDP (23 per cent) (Central Informatics Organization 2008). The Central Bank of Bahrain (Central Bank of Bahrain 2009a; Central Bank of Bahrain 2009b) has recently estimated the contribution of the sector even higher, at 27 per cent of GDP.

The sector comprises banking, insurance, investment business firms, capital market, specialised licensees and the funds industry. A snapshot of the sector is provided in Table 17.1 outlining the size of each sub-sector.

Table 17.1 SNAPSHOT OF THE BANKING AND FINANCE SECTOR IN BAHRAIN

Sub-sector Characteristics Sub-sector Characteristics Banking Total assets of US$253.2 billion Specialised • 15 firms

124 institutions comprising: licensees • 19 money changers • 24 retail banks • 9 locally incorporated banks • 15 branches of foreign banks • 64 wholesale banks • 36 representative of fices • 26 Islamic banks (included in above)

with assets of US$24 billion

Insurance 167 firms in total Funds industry • 2 616 authorised funds with a net • 37 firms in the domestic market with asset value (NAV) of US$17.1 billion

gross premiums of US$361 million • 141 local funds with a NAV of comprising: US$6.94 billion comprising:

• 26 locally incorporated firms – 83 conventional funds • 22 overseas insurance firms – 58 Islamic funds

Investment business firms

48 firms Capital market Market capitalisation US$19.95 billion • 14 brokers • 52 companies • 38 mutual funds • 15 bonds

Source:(Central Bank of Bahrain 2009a).



The financial sector in Bahrain employed about 12 000 people in 2007. According to an annual survey conducted by the Central Bank of Bahrain 1 731 new jobs were created in the country's financial services industry during 2008, taking total employment in the sector to 13 922. This figure represents a year-on-year increase of more than 14 per cent. Over the past three years (2005-2008), the financial sector has added 5 659 jobs, representing an almost 70 per cent increase over the 2005 figure of 8263 (Bahrain Monetary Agency 2009; Central Bank of Bahrain 2009b).

Although contributing roughly a quarter of the GDP, the banking and finance sector comprised only 2.4 per cent of the total Bahrain workforce in 2007 (Figure 17.1) (Central Bank of Bahrain 2009a; Central Bank of Bahrain 2009b).

Figure 17.1

BANKING AND FINANCE AS A PROPORTION OF GDP AND LABOUR FORCE (2007)

Source: (Central Informatics Organization 2007; Central Informatics Organization 2008)

The role of the financial services sector as an important pillar of Bahrain’s economy extends well beyond the sector itself: it significantly contributes to job creation in other sectors. The UK Joint Money Laundering Steering Group (Joint Money Laundering Steering Group 2006) estimated that roughly every job in the financial sector generates two more in other related industries (see Box 17.1).

Box 17.1 HOW MANY JOBS DOES THE FINANCIAL SERVICES SECTOR GENERATE?

Why are financial centres seen as an important part of the answer to the Gulf region’s employment deficit? While relatively few people are employed directly within the narrow range of international financial market operations, the industry requires physical and technological infrastructure (bringing in construction and IT projects and services), ultra- modern communications, accounting and legal professional services, hotels, restaurants, and travel — to name just some of the wide range of spin-off activities. One popular rough estimate is that every job in the financial sector generates two more in other related industries. The GCC labour market is currently around 16–17 million, of which about 5–6million are domestic residents, mostly employed in the government sector. The target for net job creation may be around 2–3 million over the next 10–20 years. Domestic residents are being encouraged to take up private-sector employment as state-sector jobs cannot expand any further; thus some 2–3 million suitable private-sector jobs will be required to avoid rising unemployment rates. The potential in the financial sector and related services may be for as many as one million extra jobs over the long run, but improved local skills may also mean that expatriate staff can be replaced gradually, raising the potential number of extra jobs for residents to perhaps 1.5–2 million over the next decade. This would go a long way to meeting job targets for the GCC.

Source: (Royal Institute of International Affairs (Chatham House) 2008).



This employment generation effect was also confirmed in interviews conducted in other sectors during the course of the Skills Gaps Research project. In the business services sector in particular, a majority of interviewees commented on the importance of the banking sector as a source of business. This applied in particular to legal and accounting service providers.

Around a third of the workforce in the financial sector is non-Bahraini and the proportion of Bahraini nationals in the workforce declined from 74.5 per cent in

10

2005 to 68.1 per cent in 2007. This downward trend continued in 2008 (to 66.7 per cent) despite the fact that 57 per cent of the new jobs created in 2008 went to Bahrainis, with 43 per cent going to foreign workers. The absolute number of Bahrainis employed in the financial sector has risen from 8 298 in 2007 to 9 283 in 2008 (Bahrain Monetary Agency 2009; Central Bank of Bahrain 2009b).

According to the Central Bank of Bahrain (Central Bank of Bahrain 2009b), the employment of Bahraini women has increased by 12 per cent during 2008, accounting for 37 per cent of all Bahrainis employed by financial institutions (and a quarter of the total workforce across all sectors in 2008).

The banking industry remained the largest employer within the financial services industry, with banks accounting for 9 582 (69 per cent) of all financial sector jobs in 2008. The banking sector created 974 new jobs, representing 56.3 per cent of all new jobs created by the financial services industry in 2008. Bahrainis comprised 6 916 (72.2 per cent) of the banking jobs in 2008, with Bahraini women, numbering 2 605, accounting for 27.2 per cent of all jobs in the banking sector.

The insurance industry also posted a strong increase of 24.5 per cent in employments, with insurance firms employing a total of 1 378 people in 2008, up from 1 107 in 2007. The Bahraini workforce in the insurance sector grew 18 per cent to 854, from 719 in 2007, with Bahraini women totalling 322, thus representing 37.7 per cent of the Bahraini workforce in the insurance sector.

In 2005 Bahraini nationals comprised the largest proportion of the total workforce in commercial banks (85 per cent), however, were not as strongly represented in insurance firms (69 per cent), investment banks (70 per cent) and Offshore Banking

11

Units (OBUs) (71 per cent). In addition, foreign nationals were concentrated in more senior positions outnumbering Bahraini nationals at the executive manager and senior manager levels in all sub-sectors, with the exception of local commercial banks. Women were also significantly underrepresented in senior management categories, filling just eight per cent of positions (Ernst & Young 2005).

10 Number based on Ernst & Young (2005) report.

11 The Ernst and Young 2005 surveys divided the banking and finance sector into the following sub sectors: commercial banks, investment banks, off-shore banking units, specialised banks, and insurance companies. These categories will be used throughout this chapter when drawing upon the Ernst and Young study data.



In the Ernst & Young employer survey, a number of organisations reported that Bahrainis had replaced foreign nationals in critical positions in the previous five years. In particular, four information technology (IT) manager positions and four senior human resource positions previously held by foreign nationals had been filled by Bahraini nationals. Despite this, employers also reported a large number of senior positions in their organisation had been continuously held by foreign nationals in the same period. From these data, it appears that foreign nationals are strongly represented in the positions of risk manager, chief executive officer and IT manager in particular (Ernst & Young 2005).

In the survey and workshops, employers in the banking and finance sector noted three primary reasons for the under-representation of Bahrainis in senior management:

• skills gaps — a lack of local workforce with appropriate skills and expertise

• cost — Bahrainis have high salary expectations and foreign nationals are more

cost-effective to employ

• workforce culture — there is a perceived unwillingness from Bahraini nationals to take up positions, coupled with issues with work ethic and attitudes to work (Ernst & Young 2005).


Skills are developed to support the banking and finance sector through two mechanisms — education and professional training. These are discussed below using data from the Ernst & Young report.

Education

Undergraduate courses in banking and finance are provided at the University of Bahrain, including through their Islamic Banking Center. These include:

• Bachelor of Science in Banking and Finance

• Bachelor of Science in Insurance

• Business Administration

• Accounting & Finance

• Business information systems.

CEOs in the insurance sector also reported that basic academic insurance courses are readily available in the market.

Ernst & Young recorded few findings about education. The one notable finding was that banking CEOs reported a general feeling in the banking community that the quality of graduates is declining and that graduates do not possess some basic skills — for example, quantitative analysis skills and English language skills (Ernst & Young 2005). This observation is consistent with the findings of interviews conducted with senior employer representatives in other sectors.



Professional training

Across the banking and finance sector the average training budget in 2005 was BD148 201, representing two per cent of total human resources budgets. Training budgets have increased modestly since 2003, from 1.6 per cent of human resources budgets. Investment banks and the insurance sub-sector had the highest training budgets in 2005 (3.5 per cent and 3.1 per cent of total human resources budgets respectively) and also recorded the strongest growth in training budgets since 2003. This suggests a stronger focus on skills formation in these sub-sectors (Ernst & Young 2005).

The stated training budgets include a one per cent levy paid to the Bahrain Institute of Banking and Finance (BIBF). The BIBF is the key training body for the banking and insurance sectors in Bahrain providing a range of training courses as well as sponsorship for banking and finance sector employees to undertake advanced academic qualifications. A brief overview of the services provided by the BIBF is in Box 17.2.

Box 17.2 BIBF TRAINING AND EDUCATION PROGRAMS

The BIBF has six learning centres: • Banking Learning Center — offers courses in the areas of Domestic Banking, Credit

and Credit Analysis, Finance and Economics, International Banking, Treasury and Capital Markets.

• Center for Islamic Finance — offers a range of courses in Islamic finance as well as specialist postgraduate qualif ications.

• Insurance Learning Center — offers a wide range of insurance and risk management courses to assist participants in their professional development.

• Center for Leadership and Management — courses designed to improve competencies by developing knowledge, skills and attitudes. Also offers courses covering fundamental and practical aspects of marketing, sales, public relations and marketing communications in correlation with market dem and.

• Accounting and IT Center — accountancy training in addition to tuition in preparation for examinations leading to internationally recognized professional accounting qualifications. IT courses in MS Office applications, internet applications, information systems, business continuity planning and IT project management.

• Academic & Executive Learning Center — provide world class postgraduate academic programs through strategic partnerships with reputable and accredited universities in the United States and the United Kingdom.

Source: (Bahrain Institute of Banking and Finance 2009).

Employees in the banking and finance sector reported through the Ernst & Young (Ernst & Young 2005) survey that the most common training they had received was technical skills training. Experience from other countries, such as the UK and India, however, shows that in the financial services industry there is great demand for graduates with extensive soft skills rather than technical skills which are considered as trainable. A majority of organisations participating in the study say they experience difficulties in recruiting people with the right skill set (KPMG Consulting (KPMG) 2007).



In October 2007, Tamkeen and Ernst & Young jointly started an initiative aimed at training Bahraini finance professionals. The training push was based on findings from the Human Resources Development Fund (HRDF)/ Ernst & Young study that more than 1 340 banking and investment specialists will be required by 2009 to fill expected job vacancies in the financial sector. Tamkeen committed BD1.6 million for the project over four years with the training being provided by Ernst & Young (Ernst & Young 2005).

Successful applicants for the training program are trained as Certified Accounting Technicians (CAT), Certified Management Accountants (CMA), Professional Risk Managers (PRM), and to receive a qualification from the Association of Chartered Certified Accountants (ACCA). The program is open to school graduates (CAT only), BSc graduates and existing employees who wish to pursue career opportunities in the finance and accounting field. Interest in the program was much greater than expected, with four times as many Bahrainis applying for the training than expected. By the time it concludes in 2011, the program is expected to have produced 700 qualified Bahraini finance and accounting professionals. The program is the first of its kind to sponsor such a large number of Bahrainis to study for professional rather than academic qualifications (Tamkeen 2007; AME Info 2008)

Training barriers

CEOs of banking and insurance firms noted in the workshops that training budgets were inadequate compared with international standards. Despite this, the most commonly reported barrier to accessing training from the survey was an inadequate number of courses available locally in the specialisations that required skill development. According to Ernst & Young, 50 per cent of HR managers reported this was a barrier compared with less than 20 per cent who cited budgetary constraints as a barrier. Lack of courses in Arabic was mentioned as another problem by three per cent of respondents (Ernst & Young 2005).

Employers reported a number of areas for which there were insufficient training offerings in Bahrain and the Middle East. These training gaps varied by sub-sector, however, strategic human resources (HR) was common across all. The training gaps reported by employers are presented by sub-sector in Table 17.2.



Table 17.2 SPECIALISATIONS WITH INSUFFICIENT TRAINING OFFERED LOCALLY

Sub-sector Specialisation

Commercial banks • Credit analysis

• D erivatives • Treasury • Risk m anagem ent • Operations managem ent • Investment analysis • Public relations • Strategic HR managem ent • Islamic sharia • IT

Investment banks • Product development

• Strategic leadership • Change management • Project managem ent • Strategic HR managem ent • Corporate finance • Financial controls

OBUs / Specialised banks • Internal audit

• Strategic banking • Strategic HR managem ent • Credit analysis • Financial modelling • Legal – international law • Portfolio analysis • Risk m anagem ent • Leadership

Insurance • Leadership

• IT security • Strategic HR managem ent • R einsurance

Source: (Ernst & Young 2005).

Notably, many of the BIBF courses cover these areas, however, CEOs from banks noted in the workshops that BIBF training courses were good for junior and middle management but were geared too low for senior staff. In addition, some CEOs reported that the BIBF courses were:

• too academic in nature with insufficient practical focus

• rather of a lecture-type training with no focus on vocational training (‘need for

simulation modelling’)

• in need of instructors from the financial industry with practical experience.



Similarly, CEOs from insurance companies believe BIBF training courses to be adequate when it comes to providing primary and secondary insurance skills, but insufficient in providing tertiary and specialised skills and insurance management skills for senior management staff.

17.3 International trends in finance and banking

The global financial crisis and its impacts on the global banking sector

Financial markets around the world have been in great turmoil since mid 2007. What first started as a crisis in the US real estate and mortgage market (the so- called ‘sub-prime crisis’) has later turned into the global ‘credit crunch’ and a ‘liquidity crisis’. Due to their exposure to structured debt and derivatives, investors and banks around the world have suffered significant losses. As a result of their reduced capital, they have been faced with a reduced ability to lend. The situation became worse with the collapse of US investment banking giant Lehman Brothers and other large international banks triggering a massive rise in risk aversion in global financial markets, which is reflected in a variety of indicators, including a rise in risk premiums and steep falls in global stock markets (Al Maraj 2009).

In the short term, the shrinking and increasingly risk-averse global capital pool, together with the market’s demand for higher banking capitalisation, means that many investment projects will have to be postponed. In the longer term, the lack of investment means a global slowdown in growth and can even lead to a global recession (on 10 March 2009, IMF chief Dominique Strauss-Kahn described the global financial crisis as ‘the great recession’, excluding any chance of a global recovery before 2010. ‘The IMF expects global growth to slow below zero this year, the worst performance in most of our lifetimes’) (Islam Online).

Increased risk-averseness, less available credit and slowing or negative growth will particularly affect the areas of the world that are dependent on foreign capital for the development of infrastructure and industry, such as Latin America, emerging Europe and the Balkans. This also means a decline in demand for goods and a resulting decline in manufacturing with particular negative effects on Asian countries that are home to much of the world’s manufacturing (especially China), and on commodity-producing states which provide the basic materials used in the construction of manufactured goods, such as Latin America.

The shortage of capital is also likely to have a further devastating effect on the banking sector. As the capital pool shrinks, liquidity becomes a serious problem for banks as they struggle to meet reserve requirements and avoid contagion (STRATFOR 2008).

Impacts on Bahrain and the Gulf region

Fears of a liquidity shortfall have also loomed over Gulf banks: Many GCC countries have young banking sectors that have been affected by tightening global liquidity and disappearing capital. Despite the fact that banks in the Middle East are not strongly integrated with the international financial system, a feedback loop from real economic slowdown (i.e. deterioration in credit quality) on national GCC banking systems is possible. Particular vulnerabilities are seen in countries where banks have large exposure to international trade, tourism, housing and real estate (World Bank 2008a).



Bahrain has in the past capitalised greatly on its location at the heart of the oil-rich Gulf region and has used its proximity to massive capital flows to build a powerful banking sector. This proliferation of banks has been shaken by the financial crisis, but it is expected that they can evade a serious crisis because the GCC states have avoided incurring massive amounts of debt (STRATFOR 2008). Since the beginning of the financial crisis the Bahrain All Share Index, from a high of 2 900 points on 16 June 2008, has experienced a significant correction to 1 580 points on 15 March 2009 reflecting a decrease of 45 per cent (Bahrain Stock Exchange 2009). Stock markets in other GCC countries show similar developments and they are predicted to remain volatile in the region (World Bank 2008b).

Some GCC States decided to provide support to their banking sectors, either in the form of recapitalisation funds, or by providing blanket guarantees of deposits, or by a combination of both. The Central Bank of Bahrain is controlling the sector’s involvement in the volatile real estate market as a precaution, and has been adjusting interest rates to maintain liquidity, which appears to be achieving the desired goal (STRATFOR 2008; World Bank 2008b). An overview of policy measures taken by GCC countries is provided in Table 17.3.



Table 17.3 POLICY RESPONSES BY GCC COUNTRIES (AS OF DECEMBER 2008)

Country Monetary policy Banking system liabilities

Financial system capital

Bahrain Verbal assurance of liquidity provision Already had deposit No known measures. if needed. insurance. Broadened collateral eligibility. Verbal assurance of

banks’ soundness.

United Arab Emirates Special new $14 billion central bank 3-year guarantee on all $7 billion in long-term lending facility for banks. deposits and interbank deposits in local banks. Eased reserve requirements (lower loans of UAE banks (12 penalty rate on reserve shortages). Oct. 2008); later extended

to foreign banks.

Qatar Verbal assurance of liquidity provision Verbal assurance of Qatar Investm ent if needed. banks’ soundness. Authority (QIA) takes 10-

20% stakes in local banks (about $5 billion total).

Saudi Arabia Liquidity injections to interbank market Deposit guarantee. $2.5 billion deposit in

($5 billion during 20-21 Oct. 2008). Saudi Credit Bank (low

Assurance of additional available income household credit liquidity through repo facility. provider). Lowered reserve requirements from 13% to 10% to 7%.

Oman Lower reserve requirements (additional Already had deposit No known measures.

instruments counted as reserves). insurance. Postponed planned tightening of loan Verbal insurance of banks ’ to deposit ratio. soundness.

Kuwait 150 basis point cut in benchmark Emergency deposit Kuwait Investm ent

discount rate during 7-29 Oct 2008. guarantee for Gulf Bank, Authority (KIA)

Introduced new maturity repos (1 day later extended to all allocations to local and 1 month) at rates below interbank Kuwait banks. investment funds. rates (19 Nov. 2008). Verbal assurance of Raised loan to deposit ration from 80% banks’ soundness. to 85%.

Source: (World Bank 2008b).

Compared to other parts of the world, particularly developed countries, however, the impacts of the global financial crisis on Bahrain and other GCC countries are considered to be limited and manageable, primarily owing to the fundamental strength of these countries. Because of the oil wealth and carefully managed economies, GCC States are largely insulated from the global credit crunch (Shura Council 2008; Smith 2008).

Surplus revenues generated over the past few years through robust oil prices and investment income generated so far this year and last have produced massive current account surpluses and these are still available to fund major state infrastructure projects.

Mark Hanson, Chief Executive of Global Banking Corporation (GBCORP)(Smith 2008).



GCC States are capital-rich with all of them having current account surpluses (e.g. Kuwait: 42 per cent of GDP as of December 2008). Being creditor nations, i.e. net providers of capital to the rest of the world, GCC States remain much less vulnerable to a shrinking global capital pool than net capital importers. Bahrain, with a budget surplus of 3.4 per cent is much more limited in recapitalising its system than, for example, Kuwait. Nevertheless, it is able to maintain flexibility in dealing with financial issues as they arise (STRATFOR 2008) (see also Box 17.3).

Box 17.3 THE ROLE OF SOVEREIGN WEALTH FUNDS (SWF) IN ABSORBING CREDIT SHOCKS

One of the most important mechanisms for accumulating capital — because of its political and f inancial implications — is the Sovereign Wealth Fund (SWF). These pools

12

of capital serve to offset debt and deal with almost any other problem GCC states may encounter, such as a fall in oil prices. SWFs are massive investment funds that make strategic investment choices for the GCC states. GCC SWFs maintain holdings that range from Saudi Arabia’s relatively modest US$5.3 billion to Abu Dhabi’s massive US$875 billion nest egg (and Abu Dhabi has even more money socked away in other SWFs). Bahrain’s SWF, the Bahrain M umtalakat Holding Company, was established in 2006. It currently maintains holdings of US$14 billion. SWFs are invested primarily in the equity markets of developed nations, and some have taken sizable stakes in Western businesses. In addition to the SWFs, the GCC states also maintain large caches of reserves.

These pools of capital allow the GCC states to exercise great flexibility, especially during credit crunches. Gulf oil is controlled by the monarchies that rule each state, and these strong governments not only can draw on their large reserves but also can run their yearly budgets with substantial built-in surpluses. This gives the governments a great deal of room to intervene in the local markets to compensate for the effects of the financial crisis.

Source: (STRATFOR 2008).

Furthermore, the fact that the Bahraini banking sector is unlikely to be very severely affected by the global financial crisis can not only be attributed to the prudential management of the banks, the Central Bank’s interventions and the role of SWFs. It is also due to the relatively large number of Islamic banking institutions which, by nature, distance themselves from the kind of market speculation that takes place in western banks and do not embark on projects that entail financial risks. Islamic institutions do not rely on bonds and stocks, nor do they engage in debt trading as buying and selling of debts is prohibited under Sharia law. Due to this conservative approach, Islamic banks did not accumulate any “toxic assets”, and as a result, have no problems with major write-offs. While it is inevitable that even Islamic banks will be affected by the financial crisis to a certain degree as they are part of the wider global financial system, it is only their profits that can be affected, not the capital (Al-Hamzani 2008)

12 Despite their budget surpluses and status as net capital exporters, GCC countries do maintain external debt. Bahrain has net external debt (including both public and private foreign capital borrowing) of 53 percent of GDP. Much of this debt has been caused by massive infrastructure and development projects such as Bahrain’s efforts to grow its financial sector (STRATFOR 2008).



Emergence of Middle East as banking centre

Long before the discovery of oil, the strategically located GCC States served as a hub for the major East–West trading routes, thus creating a strong tradition of trading activity, travel and hospitality. However, over the last century, Gulf economies were being transformed by the rising global importance of oil. Economic growth has generated new needs and led to the development of new industries and infrastructure, including ports and airports, local utilities and services, tourism, communications and media, property development and wealth management.

The historical and geographical advantages of the Middle East, which resulted in an early formation of trade and international relations, are responsible for the growth in trade-related activities and finance. Kuwait, for example, set up a wealth fund as early as 1953 and established financial market operations including a stock market in the 1970s on the back of the beginning oil boom.

Bahrain, having lower rates of own oil production, is the least oil-dependent of all six GCC States (in terms of oil/GDP ratio). It has started to pursue growth strategies very early in non-energy sectors: building on its advanced education system, Bahrain expanded in travel and transport, and started its efforts to take the lead in regional finance and insurance markets in the 1970s. To date, it remains a regional leader in banking and insurance (STRATFOR 2008).

The importance of the Gulf region as a financial hub became manifest when major international banks, such as Japanese Nomura, UK Standard Charted and US Citibank, started in 2008 (before the financial crisis) to move key investment banking personnel into the region and opened up large trading floors (Platt 2008). In the future, the Gulf region’s position as a major banking and finance centre is likely to be strengthened further as investments will continue to be attracted by natural resources and trade routes (see Box 17.4).



Box 17.4 SHIFT IN GLOBAL POWER TOWARDS THE EAST AND NATURAL RESOURCES

The new patterns of world trade and investment that emerge from a fundamental rebalancing of consumption and saving will look very different from the old system focused on Western financial centres such as the US. Successful globalisation has always followed its customers and banks will follow natural trade routes. We are moving to a multi-polar world where the Western financial centres could be bypassed. China, for example, will invest where it needs to, to build its econom y. This will include more regional investment and direct investments in natural resources around the globe. Financial institutions will have to adapt to meet this new reality. G lobal banking will shift towards a system based on facilitating investment flows linked to trade routes and natural resources. Banks are conduits for moving money around: they facilitate flows of capital. In future money will follow natural resources. There will be a greater focus on what you have in terms of resources, rather than what you can create through financial innovation. Emerging market nations have recognised their new position of power and are demanding a seat at the table, with the G20 emerging as a key group pushing for change in the world’s financial systems. New financial institutions from these countries will emerge to challenge the hegemony of the weakened Western banks. The importance of sovereign wealth funds, Chinese banks and Gulf Cooperation Council (GCC)-based private equity and real estate investors will continue to grow. In some cases these non- traditional players will provide an exit route for Western governments looking to sell down their stakes in the banking system and, in time, will purchase major or controlling stakes in the state-owned banks. There will be political resistance to these investments, but economics will prevail.

Source: (PricewaterhouseCoopers 2009).

Rise of Islamic banking

Modern Islamic commerce and the Islamic financial system came to life in 1963 with the establishment of the first Islamic bank in Egypt. Islamic financial institutions strictly follow Islamic sharia law rather than conventional western banking and insurance practices. The main objective of economic activities in Islam is making financial profits without neglecting other human beings or exploiting their needs. Under this law, for example, conventional insurance is not accepted as it contains elements such as uncertainty, gambling and interest (‘riba’) that are contradictory to Islamic principles. Islamic banking requires transactions be structured in alternative ways since the rules ban interest and trading in debt (Patel 2002; Galal 2008; Garas 2008).

Over the past two decades the world has seen an enormous growth of Islamic financial institutions. This growth was primarily due to (1) the launch of new Islamic banks which not only entered traditional Islamic financial markets in GCC countries, Southeast Asia and Pakistan, but also increasingly operate out of western financial centres such as London; (2) the conversion of some conventional banks into Islamic banks; and (3) the establishment of Islamic units within other conventional banks. According to Moody's Investors Service, finance that complies with Islamic law currently (as at end of 2008) accounts for around $700 billion of assets and is growing at 10 to 30 per cent a year. Today, more than 280 Islamic banks exist in 48 countries, along with 300 Islamic fund units in conventional commercial banks in many Muslim or non-Muslim countries (Galal 2008; Garas 2008; Grose 2008)



The financial crisis seems to have further contributed to the surge in Islamic financing. While the western banking system is caught in a liquidity crisis, many Islamic institutions, which draw on the petrodollar surpluses of GCC countries, are still able to lend money to businesses and others in demand of loans (see Box 17.5).

Box 17.5 BOOM OF ISLAMIC BANKS IS AN UNEXPECTED BYPRODUCT OF THE GLOBAL FINANCIAL CRISIS

A Moody's report released in November 2008 shows that Islamic banks have been fairly resilient. No Islamic financial institution has acknowledged investing in Bernard Madoff's US$50 billion Ponzi scheme, and Saleh Al Tayar, Secretary General of the Franco-Arab Chamber of Commerce, said the US$4.9 billion hit taken by Societe Generale SA from what it calls unauthorised trading by Jerome Kerviel couldn't have happened in an Islamic institution. ‘If global banking practices were based on Islamic practices then we wouldn't be seeing the kind of crisis we are living through now’, he said. Islamic financial institutions work on a philosophy of prohibiting transactions considered immoral and promoting greater social justice by sharing risk and reward. Investing in casinos, pornography, alcohol, tobacco, arm dealers or anything to do with pork is out: long-term investments in projects considered to benefit society are in. Interest paym ents, short selling and contracts considered excessively risky are also prohibited. That rules out some of the products that got Western finance into so much trouble such as sub- prime mortgages, collateralised debt obligations or credit default swaps.

Source: (Joyner 2008).

It seems, however, that further growth of Islamic finance may be hampered by the global skills shortage, with the number of specialists with adequate Islamic finance skills currently not keeping up with the increased demand for these professionals. Particularly GCC countries, Malaysia, Pakistan and Indonesia are in need of “professionals who are not only qualified, but have the relevant experience too” (Bokhari 2008).

GCC countries have traditionally been a key market of Islamic banking and finance. An enormous surplus in funds in Gulf countries as a result of high oil prices in the mid 1970s encouraged them to seek investment opportunities while abiding by Islamic law. Bahrain has since evolved to be the financial hub with the largest number of Islamic banking and financial institutions. Bahrain is home to 26 Islamic banks and 68 local Islamic funds. In these times of a global financial crisis, Bahrain’s Islamic lending facilities appear to be faring better than interest-based lending facilities (Galal 2008; STRATFOR 2008; Central Bank of Bahrain 2009a)

Regional competition

A number of other countries in the Gulf region have begun to expand their service sector with the goals to maintain or improve the employment situation, and expand their GDP. Particularly UAE and Qatar have recently developed their financial sector. This competition is also reflected in the increased building and development activities in the region, including the development and redevelopment of property and financial centres (Royal Institute of International Affairs (Chatham House) 2008).



Emerging trends – overview

The 2005 Ernst & Young study for the HRDF, through surveys of employers and employees within the banking and finance sector, as well as face-to-face interviews and workshops with senior executives and other key stakeholders, identified the following key emerging trends in the Bahraini banking and insurance industry (see Table 17.4).

Table 17.4 EMERGING TRENDS IN BANKING AND INSURANCE

Banking Insurance • Globalisation and open markets • New products and developments, especially

Islamic products • Customer service becoming the increasingly

differentiating factor • Information technology and eBanking • Increased focus on the development of human

resources • Emerging competition from the GCC f inancial

centres • Basel II — greater focus on risk management and

compliance • Focus on relationship banking and high net- worth

relationship banking • Focus on investments — asset management, real

estate investment, portfolio managem ent

• Opening up of the market — for both conventional and Takaful

• Compulsory medical insurance for expatr iates likely to be implemented over the next five years

• Likely growth in property insurance

Source: (Ernst & Young 2005).

17.4 Employer survey results

The employer survey comprised nine organisations from the banking and finance sector out of the 14 organisations that were selected as part of the Skills Gaps Research Study, representing 64 per cent of the total possible banking and finance survey pool. These responses represent approximately 1 740 employees or about 13 per cent of the banking and finance labour market. Of the survey responses, around 85 per cent of employees were Bahraini and 15 per cent non-Bahraini, which shows the high level of Bahraini employment in the sector. Further, around 63 per cent of employees in the sector were male.

Surveyed employers grouped employees in their organisation by position and demographic group. Positions held within the banking and finance sector differed according to gender and nationality. Table 11.3 shows banking and finance sector positions by demographic group. Surveyed employer responses indicate that non- Bahrainis were more likely to be managers and business executives or business professionals than Bahrainis, and that females were more likely to work in administrative services and sales than male employees.



Table 17.5 HIGH-LEVEL OCCUPATIONS — BANKING AND FINANCE SECTOR

High-level category







Total 100% 100% 100% 100%


Considering these occupations further, when asked to provide information on occupations at more detailed level (second-tier level), employers identified most employees in the sector as bank tellers (15 per cent), administrative clerical workers (10 per cent) and commercial and financial business managers (eight per cent) (see Table 11.4).

Table 17.6

SECOND-TIER OCCUPATIONS — BANKING AND FINANCE

Second-tier occupation Proportion of total sector responses

Bank teller (front office) 15% Administrative clerical workers 10% Commercial & f inancial business managers 8% Other managers 8% Sales and purchasing occupations 6% Information systems technicians 4% Heads of sections 4% Protective workers, guards and messengers 4% Secretaries 3% Professionals in corporate banking 3% Financial consultant (front office) 3% Administrative development specialists 3% Administrative m anagers 2% Professionals in accounting 2% Accounting and finance clerks 2% Professionals in insurance — underwriter 2% Professionals in private banking 2% Professionals in retail banking 2% Supervisors of sections 2% Professionals in internal audit 2% Investment analysts 2% Professionals in risk management (credit and operational) 2% Manpower (human resources) specialists 2%




In addition to the occupations listed in the table above, respondents identified a large number of other occupations present in the banking and finance sector including, professionals in finance, professionals in compliance/legal, professionals in asset management, professionals in equities, legal clerks and professionals in economics. Definitions for the occupations identified in the table below are provided in Appendix B.

Banking and finance sector respondents also identified the top five skills required in the sector, which are outlined in Table 11.6. The most commonly identified skill required in the banking and finance sector were risk management skills (11 per cent of total responses).

Table 17.7 TOP 5 SKILLS — BANKING AND FINANCE


Risk management skills 11%



Human resources skills 8%

Treasury and investment skills 8%

Source: Allen Consulting Group and Eidos).

Respondents also noted the change in quality of recruits in the banking and finance sector by nationality compared with two years ago. Figure 11.9 shows that neither Bahraini nor non-Bahraini recruits were of lower quality than two years ago. Overall, however, Bahraini recruits had improved marginally more than non-Bahraini recruits in terms of quality:

• for combined technical and generic skills, while 89 per cent of employers

agreed that Bahraini recruits improved in this area, 67 per cent found that the quality of non-Bahraini employees had improved over the period

• for generic skills, 78 per cent of employers agreed that Bahraini recruits

improved in this area, compared to 56 per cent for non-Bahraini employees.

Figure 17.2





Employers also rated the importance of work-related skills in the banking and finance on the scale ranging from not important to very highly important. In the banking and finance sector, work communication skills were the most important skills, rated as very highly important by respondents, as were customer communication skills, management skills, problem solving skills and persuasive skills. Figure 11.10 displays the importance of skills relative to one another in the banking and finance sector.

Figure 17.3 IMPORTANCE OF WORK RELATED SKILLS


17.5 Skills gap analysis

Findings from the HRDF/Ernst & Young (2005) report

The Ernst & Young (2005) study identified skills gaps in both the banking and insurance industry. For the sake of completeness, the findings are quoted in Table 17.8. It is, however, recommended that this information be used with caution for the following three reasons:

• The financial crisis has brought about considerable changes in the financial

sector, including a change in the occupations and skills in demand (examples are provided in the next sub-section).

• The ‘skills gaps’ identified in the Ernst & Young report covered almost the

whole range of financial services. However, the report does not provide any information on priority or the dimension of the skills gaps.



• The information provided does not only include skills gaps but also extends to occupations, functions, services and products in the financial industry, with significant overlaps and potential for confusion. Dealers and traders, for example, are not a skill but an occupation for which skills such as numerical and analytical skills and resilience (along with experience) are necessary. A credit analyst will need financial (statement) analysis and, depending on their

13

specialisation, project finance skills, while risk managers need risk modelling and management techniques. On the other hand, knowledge of and experience with derivatives and structured products, for example, are crucial for dealers, traders, operations, risk management, legal, financial controls, internal audit and compliance.

Table 17.8

SKILLS GAPS IN THE BANKING AND INSURANCE INDUSTRY

Banking Insurance Core skills gaps

Support functional skills gaps

• Investment (asset/wealth m anagem ent)

• D ealers • Operations • Credit analysis • Islamic/Sharia products • Project finance • D erivatives • Traders • Asset managem ent/wealth

m anagem ent

• Underwriting • Reinsurance • Investment analysis • Portfolio managem ent

• Risk m anagem ent • Legal • Financial controls • Human resources • Internal audit • Information technology • C ompliance • Marketing and sales • Strategic financial planning

• Risk managem ent • Information technology • Compliance • Financial management • Financial controls • Human resources

Source: (Ernst & Young 2005), p. 110.

It appears important to point out that certain skills are not occupation-specific but will be needed across a whole range of occupations or functions in the financial industry, such as numerical and analytical skills. While some skills can be acquired through formal training, others are rather acquired through experience. Occupations for which experience is more critical than formal training, for instance, include traders and dealers. Communication and organisational skills and other soft skills are necessary throughout all occupations. In addition, CEOs and senior managers surveyed by Ernst & Young reported a perceived lack of managerial and leadership skills (Ernst & Young 2005).

13 A distinction would need to be made, for example, between operational risk, market risk and credit risk management/managers.



Ernst & young found that approximately 1 340 new employees will be needed in the banking and insurance industry by 2009. In reality, however, as described earlier, the financial sector has added 5 659 jobs over the past three years (2005- 2008), representing an almost 70 per cent increase in employment (Ernst & Young 2005).

Table 17.9 lists some of the qualifications suitable for a selection of the skills/occupations/functions in demand in the financial sector in Bahrain.

Table 17.9 SKILLS GAPS AND RESPECTIVE QUALIFICATIONS — COMMONALITIES

Skills gaps Qualification Risk managem ent* Financial controls Compliance and internal audit Credit analysis**

Investment banking and analysis Investment analysis and portfolio managem ent

Information technology Marketing and sales Strategic human resources managem ent

Underwriter Dealer Operations

Chartered Accountancy (CA)/Certified Public Accountant (CPA) * CPA supported by FRM for risk managem ent ** CPA could be substituted by an MBA in finance,

accounting, banking or engineering

Chartered Financial Analyst (CFA)

MBA with respective specialisation

Basic graduation with experience

Source: (Ernst & Young 2005), p. 121.

Potential skills gaps derived from recent developments

Recent developments, such as the global financial crisis including the collapse of major international financial institutions and the rise of Islamic banking, have changed the financial labour market significantly. As a consequence of these developments, some skills and occupations will be no longer in demand or demand is declining (e.g. asset securitisation) while demand for others will increase considerably. Impacts will be felt in the Bahraini financial sector as well.

The global financial crisis contains many lessons for the financial industry (but also for regulators). In particular, it underscores the need for sound risk management, effective internal controls and strong corporate governance at financial institutions (Al Maraj 2009; PricewaterhouseCoopers 2009). All of these elements are essential to ensure the stability of individual financial institutions and of financial systems:

• Corporate governance: The importance of sound corporate governance is one

issue brought to prominence by the recent global financial turmoil as the failure of internal monitoring and control in financial firms was an important cause of the crisis.



• Risk management: As a result of the financial crisis, it appears that risk regulation will undergo a major change if not a complete overhaul, with major implications on risk management practices in financial companies. The financial crisis points to the need for high standards of risk management in financial firms, and most will need to step up efforts in improving their risk management practices.

As a result, the skills that are likely to be in high demand in future are:

• Internal control skills: Financial institutions will increasingly seek to employ

internal control or audit managers who will be involved in, or leading, audits, ensure operational risks are being managed and implement policies, procedures and initiatives to stimulate internal control and monitor risk exposure. Relevant skills include auditing, internal control, finance management, management control, and/or risk management skills, as well as knowledge of accounting, SOX (Sarbanes Oxley regulations) and Code of Practice (information security).

• Basel II skills and knowledge: People with these skills will be needed to

implement the regulations relating to risk and capital management requirements designed to ensure that a bank holds capital reserves appropriate to the risk the bank exposes itself to through its lending and investment practices.

• Stress testing skills: As stress testing is increasingly being taken up by

governmental bodies around the world as a regulatory requirement financial institutions will need more people with relevant stress testing skills, including numerical and analytical skills, understanding of the role of stress testing in a bank’s risk management framework, understanding of the key industry and regulatory issues relating to stress testing, strong grasp of the macroeconomic environment as it relates to financial markets, and knowledge of investment banking products and processes. Stress testing helps to ensure adequate capital allocation levels to cover potential losses incurred during extreme, but plausible, events.

• Liquidity risk management: Liquidity risk is the current and prospective risk to

earnings or capital arising from a bank’s inability to meet its obligations when they come due without incurring unacceptable losses. The ability to measure and monitor liquidity exposure and liquidity ratios is fundamental to the success of banks and they will therefore need employees with liquidity risk analysis capabilities who understand and can apply liquidity risk principles, instruments and indicators. Knowledge of banking/treasury and balance sheet risk in corporate treasury or finance management is also often desirable.

As another result of the financial crisis, loan work out/restructuring skills are likely to be in high demand as banks are expanding their teams working on troubled and distressed loans. Such skills include credit analysis, finance and accounting skills, linked with direct experience working on covenant breaches, crisis management and insolvency.



Furthermore, recent research findings point to an already great and rising skills gap relating to the use of complex financial instruments, such as derivatives and structured products. While the use of such products is expected to increase over the next years, ‘the skillsets of staff [...] have to some degree failed to keep up with growing sophistication’ (KPMG Consulting (KPMG) 2008b). According to the survey, one in five fund managers and 23 per cent of hedge fund managers who have invested in complex financial instruments admitted to having no in-house specialists with relevant experience. The same is true for about 32 per cent of institutional investors. ‘If the fund management industry is to retain the trust of investors, it would seem imperative for it to both develop the necessary skills and then offer these skills to investors’ (KPMG Consulting (KPMG) 2008b)Relevant skills include technical skills across a wide range of markets and instrument types, knowledge of financial and investment theory, economics and statistics, analytical and documentation skills.

The rise of Islamic finance points to another skills gap in the Bahraini banking and insurance industry. Potential occupations for which there is increasing demand include Sharia compliance officers, Islamic finance/Sukuk debt capital markets specialists and investment bankers, Islamic finance structurers and business development managers, alongside all other regular banking, insurance and ancillary professions (financial controller, risk manager, CEO, legal counsel etc.). General Islamic finance related skills include a knowledge of and experience in Islamic banking and Takaful principles, instruments and products.

17.6 Future labour market and skills issues and possible solutions

Global and regional developments that took place in recent years and months have changed the labour market landscape enormously (see Box 17.6). Accordingly, the skills gaps that become evident from such developments will have changed, thus requiring different training and employment strategies.

For instance, it may not be possible — at least in the short to medium term — to fill all risk-management related vacancies with Bahraini nationals due to an insufficient number of people with the appropriate skills sets. The same may hold true for Islamic finance specialist until training programs in Bahrain are able to produce a sufficient number of people with relevant skills. Alternatively, incentives must be created for graduates from existing Islamic finance training programs in Malaysia and Hong Kong or the Islamic Fiqh Academy (IFA) in the Kingdom of Saudi Arabia to settle and apply their skills in Bahrain. Particular benefits for the sector and the country as a whole may be derived from efforts to match the needs of the financial industry with the increasing aspiration for high-quality education and employment of young Bahrainis (see Box 17.6).

The increasing regional competition also means that Bahrain will need to aim to distinguish itself from rivals, for example, by offering high-quality training opportunities to Bahraini nationals (who are then more likely to seek employment and apply their skills within the country compared to those trained outside Bahrain), attractive remuneration packages, and a high quality of living in general.



Box 17.6 OPPORTUNITIES ARISING IN THE FINANCIAL SECTOR LABOUR MARKET

How do the GCC financial markets interact with and serve the needs and aspirations of the wider population and, from this, what can we infer about the level of commitment to the success of the sector? How does the high level of expatriate staff impact on perceptions of this sector and job opportunities? The important opportunity here is to provide more and better jobs for the future, offering greater scope for career development and an international role to younger generations now coming through the education and training system. The GCC states all have very young and still fast-growing populations. Including immigration, annual population growth is 1.3 per cent in Bahrain (compared with 0.3 per cent for the UK and 0.1 per cent for Japan). Even excluding immigration, local population growth is still relatively high. Both the UN and the World Economic Forum (WEF) have called for urgent government action not only in the Gulf but across the Middle East to create jobs for the large number of young people who are entering the workf orce.

Source: (Royal Institute of International Affairs (Chatham House) 2008; Al Maraj 2009).

17.7



Appendix A

Survey methodology

A.1 Baseline study review

Tamkeen (formerly Labour Fund) in the Kingdom of Bahrain commissioned the Allen Consulting Group to undertake a market-wide comprehensive study

• to analyse the current skills inventory in Bahrain’s labour market to determine

existing skills gaps

• to assess future and emerging skills requirements.

In the course of this consultancy, the Skills Gaps Research Study provided a detailed analysis of existing and emerging skills gaps, shortages, requirements, and trends that assist in re aligning Bahrain’s educational and training systems to more effectively respond to labour market needs and demands.

More specifically, the baseline study aimed to identify skills deficiencies and gaps in the Bahrain labour market via separate surveys of employees, employers, graduates, and education and training providers.

Figure A.1

FRAMEWORK FOR THE PURPOSE OF SURVEY DESIGN


A.2 Survey design

In contrast with previous surveys of the Bahraini market, these surveys were designed not only to relate occupations to skills sets but also to examine motivational factors inherent in the choices of job seekers and employees. That is, the intention was to:



• compare employer versus employee responses related to the relative importance of work-related skills and attitudes

• identify potential mismatches in the methods used by employers to recruit

employees

• assess the extent to which Bahraini graduates with desirable qualifications are will to enter the labour market (particularly where the supply of skills in the industry falls short of demand).

As illustrated in Figure A.1, survey analyses considered demographic, educational, and employment related concomitants of supply and demand for labour at a distinct

14

point in time (late 2008). With that in mind, variables surveys included the following:

incorporated into the

• demographic (age, gender, country of birth, marital status)

• socio-economic (family wealth indicators)

• qualifications and work-related skill set.

Job satisfaction (status, income, achievement, social, work/home balance, etc.)

• occupation

• organisation (size, type, sector)

• salary (estimated monthly income0

• mobility (time to obtain first job, number of jobs, promotions/transfers, ways

of looking for work)

In addition, a number of items were intended to supplement time series outcomes

• current number of employees

• employees leaving occupational groups in the last 12 months

• employees being hired in last 12 months in occupational groups

• number of employees hired who had worked in the same occupational group previously

• calculate the net replacement rate for workers in various occupational groups

and in various industry sectors.

A.3 Data collection methodology

The intention was to administer education and training authority and employer surveys as structured interviews with key officials. Graduate students and employee surveys were to be administered by arrangement with officials. The surveys were administered in a variety of ways: hard copy, email and telephone. They were conducted in both the English language and Arabic language depending on the preference of the respondent.

14 Employees report on what is; whereas graduating students report on what is expected.



A.4 Employer survey

As illustrated in Table A.1, a sampling frame was developed based on business registrations data, from GOSI and the LMRA, which took into account industry sector and size. The aim was to sort by industry, then size with the intention of

15

collecting 30 to 35 responses in each of the cells in Table A.1.

Sampling instructions indicated that all should be approached where there were fewer than 30 organisations. Where there were more than 30, the collecting agency should sort by business name and select each nth one, where n = the number in the cell/30 till 30 is achieved. Further, if an organisation cannot be access (has ceased business) replace it with the next one on the list.

The person to be approached to coordinate the organisational response should be the company director or human resource manager. If a business is in more than one industry, there may be a requirement for separate responses for each industry (if that is the way the business is organised). Responses were to be collected by sending forms ahead of time to enable them to collate data, with a personal follow up to check on completion and obtain further qualitative responses.

Table A.1

SAMPLING FRAME ACHIEVED FOR EMPLOYER SURVEY

Industry sector Small

1-9 employees

Medium

10-99 employees

Large

100+ employees

Total

Business services 30 29 8 67

Construction 26 83 24 133

Education 6 7 2 15

Health 10 2 1 13

ICT 27 12 0 39

Manufacturing 22 31 15 68

Public administration 0 3 4 7

Telecom munications 3 5 1 9

Tourism and hospitality 21 19 12 52

Trade 271 85 19 375

Transport and logistics 14 7 5 26

Total 430 283 91 804


In addition, the sample of the employer survey can be considered in terms of the proportion of each sectors’ labour market. This analysis of the survey sample is detailed in Table A.2.

15 Thirty to 35 responses achieve the theoretical number to ensure the normalcy of distribution. However, some industries are dominated by a very small number of large employers (for example, telecommunications, education and health) while others have a number of small employers.



Table A.2 SECTORS OF THE BAHRAIN ECONOMY — 2007

Economic sector Number of employees

Proportion of labour market

Number of survey

responses

Labour force

surveyed

Proportion of

surveyed

Proportion of sector

labour

Education (private) 4829 1.4% 15 533 0.8% 11.0%

Education (American Institute of Certified Public Accountants (ACIPA))

16 282 4.9% 0 0 — —

Health (private) 734 0.2% 13 447 0.7% 60.9%

Health (American Institute of Certified Public Accountants (ACIPA))

Public Administration (health/education)

8829 2.7% 0 0 — —

14 119 4.2% 7 4337 6.5% 30.7%

Construction 115 582 34.4% 133 24 751 37.2% 21.4%

ICT 3301 — 39 331 0.5% 10.0%

Telecommunications 2412 0.7% 9 1384 2.1% 57.4%

Transport and Logistics

11 272 3.4% 26 7161 10.8% 63.5%

Business Services 2822 0.8% 67 5131 7.7% 181.8%

Manufacturing 63 439 18.9% 68 9588 14.4% 15.1%

Tourism and H ospitality

Trade (retail and wholesale)

11 selected economic sectors

23 518 7.0% 52 3964 6.0% 16.9%

71 599 21.4% 375 8836 13.3% 12.3% 335 437 100.0% 804 66 463 100.0% 19.8%

Petrochemical — — 4 3859 — —

Banking and finance — — 9 1743 — —

Note: ICT employees are excluded from the total, as these employees are a sub-sector of a number of other sectors (the majority being in the trade and manufacturing sectors). Source: (Allen Consulting Group and Eidos); (Labour Market Regulatory Authority 2008a); (Civil Service Bureau (CSB) 2008a); (General Organization for Social Insurance (GOSI) 2008)

Important to note is that the sample of employers responding is representative of the group of employers from which it was selected, i.e., the overall picture emerging from employers in any given sector is not distorted by having too few responses relative to the number in that category.



When considering the results of employer surveys, it is important to note that the results should be interpreted as a moment in time and the resulting information on employer behaviour should be used accordingly. Further, the survey results should be considered in the context of the reliability of surveys of employers. Recent research in Australia suggests that ‘it is in employers’ interests always to have more of any given skill available: their views cannot be expected to take account of the personal and social costs of oversupply of particular skills’ (Phil Lewis 2008). Therefore, there should be a balance between the views of employers, employees and students (in this case graduates) on necessary skills and skills gaps.

Further, a number of employers identified that they were unwilling to provide the information requested (or did not have the information available) for various reasons.

One reference that is made throughout this report is a reference to employer and employee reactions to a series of variables that make up a definition of attitudes to work. The complete list of these variables is provided in Box A.1.

Box A.1 ATTITUDES TO WORK — VARIABLES

Variables that make up a definition of attitudes to work include: • Easy work load • Good relationship with supervisor or manager • Good training provisions • Job where you can use initiative • Income increases with experience • Friends at work • Good physical working conditions • Same gender as employees • Same nationality as employees • Aligns with traditional beliefs • Work conflicts resolved well • Income is predictable • Treated with respect • Hours of employment flexible • Working as part of a team • Promotion opportunities • Secure job into future • Income sufficient to reward effort • High personal income • Motivating work • Predictable hours of work • Good work life balance • High work status • Close to hom e • Health insurance • Child tuition coverage • Pension benefits • Educational qualif ication




A.5 Employee survey

The sampling approach was to use the organisations being sampled in the employer survey and seek a number of staff from each. The aim was to obtain 30 to 35 employee responses in each of the cells as represented in Table A.1 above.

Table A.3 SAMPLING FRAME ACHIEVED FOR EMPLOYEE SURVEY

Industry sector Small

1-9 employees

Medium

10-99 employees

Large

100+ employees

Total

Business services 18 68 66 154

Construction 10 23 84 117

Education 3 34 28 65

Health 1 6 25 32

ICT 1 7 12 20

Manufacturing 4 16 77 97

Public sector 0 10 52 62

Telecom munications 2 18 12 32

Tourism and 1 14 10 25 hospitality

Trade 10 21 21 52

Transport and 0 4 33 37 logistics

Other 6 11 19 36

Total 56 232 441 729


As indicated in Table A.3, in only seven cases did the data collection process achieve the minimum outcome of 30 or more responses per sell with organisation size taken into account. In terms of achieving a sample of 100 per industry, this proved to be the case in only 2 of the sectors. It is not surprising that the numbers in the 1 – 9 employee category set are small — most employees in most sectors work in large or medium sized enterprises, e.g., there are virtually no small education, health, telecommunications, public sector enterprises, i.e., the sample of employees reflects where the employees are in each sector.

A.6 Education and training providers survey

Sampling instructions indicated that all the Bahraini universities (10) were to be survey (pilot was 3) and all colleges, institutes (between 50 to 60) were to be survey (pilot was10). The person to be approached was the president of the university, institute director or head of student enrolments. As with employers, responses were to be collected by sending forms ahead of time to enable the institutions to collate data, with a personal follow up to check on the responses and obtain further qualitative responses.



Table A.4

SAMPLING FRAME ACHIEVED FOR EDUCATION AND TRAINING PROVIDERS (BY INSTITUTION)

Training institution

Public Semi-

Government

Private

Total

University 1 1 3 5

College 1 0 0 1

Other 0 1 4 5

Total 2 2 7 11


A.7 Graduates Survey

Sampling instructions indicated that graduates should be approached at the relevant educational and training institutes through the head of the student body. It was also agreed that graduates would be approached at the Careers’ Exhibition (supported by Tamkeen) in November 2008.

Strata for sample included graduates whether working or not, as follows:

• private institutions — approximately 300 graduates (sample 100 (pilot 10))

• public institutions — approximately 400 graduates (sample 100 (pilot 10))

• overseas institutions — number of graduates per year not known (sample 50 if

possible (pilot 5)).

Table A.5

SAMPLING FRAME ACHIEVED FOR GRADUATE SURVEY (QUALIFICATIONS ACHIEVED IN BAHRAIN)

Graduate survey Non- Bahraini

Bahraini

Total

Prim ary/secondary school 6 24 30

Certificate/D iploma 12 168 180

Bachelor degree 2 6 8

Postgraduate degree 1 19 20

Masters Degree 0 2 2

PhD 1 5 6

Total 22 224 246


As neither the graduate nor the employee survey enquired about the type of training institution attended but rather about the level of qualification achieved Table A.5, an assumption can be made that the majority of these graduates were enrolled in private institutions.



Table A.6

SAMPLING FRAME ACHIEVED FOR GRADUATE SURVEY (QUALIFICATON ACHIEVED ELSEWHERE)

Graduate survey Non- Bahraini

Bahraini

Total

Prim ary/secondary school 1 1 2

Certificate/D iploma 2 9 11

Bachelor degree 6 23 29

Postgraduate degree 1 2 3

Masters degree 1 9 10

PhD 0 2 2

Other 0 2 2

Total 11 48 59


Table A.6, provides information about overseas study. While some of these responses undoubtedly overlap those from Table A.5, one reasonable conclusion is that the number of completed surveys approximate that specified by the sampling frame (sample 50 if possible).

Three research questions emerge from the completion of the four surveys:

• In which skilled and semi-skilled occupations in Bahrain are there mismatches

between the demand for and supply of labour?

• How must the Bahraini education market adjust in order to further the goals of Bahrainisation?

• What other adjustments must take place in the Bahraini economy to enable

this?



Appendix B

Second-tier occupation definitions

B.1 Second-tier occupation definitions

Table B.1 outlines a simple definition for the second-tier occupations drawn from the employer results and outlined in each Chapter 5 through Chapter 15. These definitions have been drawn from three key sources, including:

• the International Labour Organization’s International Standard Classification

of Occupations (ISCO) (International Labor Organization 2001)

• the Bureau of Labour Statistics in the United States, using the 2000 Standard Occupational Classification (SOC) system (Bureau of Labor Statistics (US) 2000)

• National Occupational Classification — Statistics (NOC–S) drawn from

Statistics Canada (Statistics Canada 2006)

These definitions are provided to assist in linking the identified second-tier occupations for each sector and the functionality of the jobs in each identified sector.

Table B.1

ISOC, SOC AND NOC DEFINITIONS OF OCCUPATIONS AND OCCUPATIONAL CATEGORIES

Occupation Definition

HEALTH SECTOR

Nurses Nursing professionals assist medical doctors in their tasks and provide nursing care for the sick, injured and others in need of care.

Medical sciences assistants

X–ray and medical planning technicians

Medical laboratory technicians

Carry out advisory, diagnostic, preventative and curative medical tasks more limited in scope that those carried out by medical doctors. For example, they may advise communities and individuals on birth control, hygiene ,diet and other preventative measures. Medical equipment operators control technical equipment used to diagnose or treat illnesses or disorders.

Performs routine medical laboratory tests for the diagnosis, treatment and prevention of disease. For example, they may prepare materials for experiments, tests and analysis, and assist with performing these tests.

Drug technicians Performs tasks connected with research in drug and medicines, as well as with the development of

practical applications of research results.

Pharmacy technicians Performs tasks connected with research in medical sciences, as well as with the development of practical applications of research results. For example, they may prepare materials for experiments, tests and analysis, and assist with performing these tests.

Traditional m edicine technicians

Professionals in medical science

Health professionals who diagnose and treat patients using traditional medicine methods such as naturopathy. Generally work in private practices, clinics and hospitals. Occupations in this major group are primarily concerned with diagnosing and treating health problems in humans and animals. May be involved in providing health and medical science related services such as pharmacy, nutrition, physiotherapy, and occupational therapy.




Surgeons Treats diseases, injuries and deformities by invasive methods, such as manual manipulation or by using instruments and appliances.

Professionals in pharmacology

Studying and conducting experiments concerning the effects of drugs and other substances on the tissues, organs and physiological processes of human beings.

Pharmacists Apply pharmaceutical concepts and theories by preparing and dispensing or selling medicaments

and drugs. For example, they may be involved in dispensing medicaments and drugs in hospitals, or dispensing and selling them in pharmacies, and testing drugs to determine identity, purity and strength.

Administrative m anagers

Oversee and implement administrative procedures, establish work priorities and co-ordinate the acquisition of administrative services such as office space, supplies and security services.

Secretaries Perform secretarial duties utilising specific knowledge of medical terminology and hospital, clinic, or

laboratory procedures. For example, they may be in charge of scheduling appointments, billing patients, compiling and recording medical charts, reports and correspondence.


Performs general office clerical duties requiring limited knowledge of office management systems and procedures. For example, daily tasks may include a combination of answering telephones, bookkeeping, office machine operation and filing.

Other managers Plan, organise, direct, control and evaluate the delivery of health care services, such as diagnosis

and treatment, nursing and therapy, within institutions that provide health care services. For example, they may be in charge of formulating policies, managing daily operations and planning the use of materials and human resources.

Supervisors of sections

Occupation in this group are primarily concerned with supervising a specific area of work conducted by workers engaged in providing health care services directly to patients and providing support to health care delivery.

Dieticians Conduct research and improve or develop concepts and operational methods concerning the

preparation and application of diets for general and therapeutic purposes. For example, daily tasks may include developing nutritional methods and diets and testing them, planning and directing the preparation of therapeutic and other diets for individuals or groups.

General cleaning workers

Private sector m anagers

Keep buildings in clean and orderly condition. Perform heavy cleaning duties, such as cleaning floors and removing rubbish and medical waste. Plan, direct or co-ordinate medicine and health services in private hospitals, clinics, managed care organisations, private health agencies, or similar organisation s. For example, daily tasks may include managing daily operations and planning the use of materials and human resources.

Dentists Conduct research, improve or develop concepts, therapies and operational methods, and apply

medical knowledge in the field of dent istry. For example daily tasks may include making diagnoses, advising and necessary dental treatments , giving surgical, medical and other forms of treatment for particular types of dental and oral diseases and disorders.

Dentist technicians Performs simple tasks to assist dental professionals or associated professionals in their duties.

For example, daily tasks may include assisting dentists by adjusting lights and passing tools and materials as requested, sterilising surgical and other instruments and equipment.

Heads of sections Plan, direct or coordinate an area of medicine and health services in hospitals, clinics, m anaged

care organisation, health agencies or similar organisations, in consultation with managers of other departments or sections.

For example, daily tasks may include supervising other workers and representing the department/section in its dealing with other parts of the organisation or with outside bodies.

Physical therapy Treats disorders of the bones, muscles and parts of the circulatory or nervous system by

manipulation methods, and ultrasound, heating, or similar techniques.



Occupation Definition BUSINESS SERVICES SECTOR Professionals in law Provide clients with legal advice on a wide variety of subjects and plead cases or conduct

prosecutions in courts of justice, or instruct barristers or advocates to plead in higher courts of justice.

Professionals in Provide advice on accounting matters and perform accountancy services or audits. accounting For example, daily tasks may include planning and installing budgetary, accounts controlling and

other accounting policies and systems and preparing tax returns.

Professionals in Conduct research to improve or develop economic concepts, theories and operational methods economics used to understand and describe the behaviour of national and international markets for goods,

services and labour, and advise on or apply the knowledge to draw up economic policies and to formulate solutions to present or projected economic problem s. Examples of daily tasks include advising on economic policy and course of action, preparing scholarly papers and reports, and studying and advising on various economic aspects such as fiscal and pricing policies, employment, income and productivity.

Professionals in Develop, implement and evaluate human resources and labour relations policies, programs and human resources procedures, and advise managers and employers on personnel matters.

Professionals in Sell or solicit advertising, including graphic art, advertising space in publications, custom made advertising, media signs, or TV and radio advertising time. writers and planners

Architect engineers A person qualified as both an architect and an (usually civil) engineer.

Accounting technicians Assist in planning the collection, processing and presentation of mathematic, statistical or actuarial

data and in carrying out these operations. Examples of daily tasks may include using standard computer software packages to perform mathematical, actuarial statistical accounting and related calculations, and preparing accounting results for presentation in graphical or tabular form.

Information systems Research, develop and implement information systems development plans, policies and procedures technicians and provide advice on a wide range of information systems issues.

Examples of daily tasks include modifying, integrating and testing computer systems.

Architect technicians May work independently or provide technical assistance to professional architects and civil design engineers in conducting research, preparing drawings, architectural models, specifications and contracts and in supervising construction projects.

Legal clerks Assist other legal professionals and various business professionals in connection with legal m atters.

Examples of daily tasks include examining legal records, and preparing documents relating to transfer of real estate, stocks or other matters requiring formal registration.

Accounting and Obtain, compile and compute statistical or actuarial data or perform clerical tasks relating to finance clerks financial transactions.

Daily tasks may include preparing financial documents, and calculating interest or brokerage charges and stamp duties payable.

Private sector sections Plan, direct and coordinate an activity of an organisation or enterprise which is concerned with heads providing external business services, under the guidance and consultation with managers of other

departments or sections, directors and chief executives.

Administrative Oversee and implement administrative procedures, establish work priorities, and co-ordinate the specialists acquisition of administrative services such as office space, supplies and security services.

Industrial managers Plan, direct and coordinate policies concerning personnel and the industrial relations activities of

the enterprise or organisation, in consultation with managers of other department or sect ions. Examples of daily tasks include overseeing health, safety and related programs ad act ivit ies, controlling expenditure and ensuring the efficient use of resources.

Private sector Plan, direct and coordinate those activities of a privately–owned organisation or enterprise which managers are concerned with providing external business services, under the guidance and consultation with

managers of other departments or sections, directors and chief executives.

Tourism managers Advise clients on travel options and tour packages, make bookings and reservations, prepare tickets and receive paym ent.




Other managers Plan, direct and coordinate activities of production, operation and/or personnel involved in the provision of business services.



Oversee and implement administrative procedures, establish work priorities and co-ordinate the acquisition of administrative services such as office space, supplies and security services. Compile, verify, record and process forms and documents, such as applications, licenses, permits, contracts and registrations, in accordance with established procedures, guidelines and schedules.

Secretaries Perform a variety of secretarial and administrative duties in law off ices, legal departments of large

firms, real estate companies, land title offices, municipal, provincial and federal courts and government.

Salesmen Establish business contacts, sell business services such as advertising space in the m edia,

transport services, and other facilities, credit and other business inf ormation. Examples of daily tasks include obtaining information about services to be sold and needs of prospective buyers and negotiating contracts on behalf of seller or buyer and explaining terms of sale and payment to client.

Professionals in financial science

Gas & oil cookers & heater maintenance


EDUCATION SECTOR

Primary/Intermediate education teachers

Professionals in education

Professionals in secondary education

Professionals in handicapped education

Professionals in high education

Professionals in education in private institutions


Collect and analyse financial information such as economic forecasts, trading volumes and the movement of capital, financial backgrounds of companies, historical performances and future trends of stocks, bonds and other investment instruments to provide financial and investment or financing advice for their company or their company's clients. Their studies and evaluations cover areas such as takeover bids, private placements, mergers or acquisit ions. Oil and solid fuel heating mechanics install and maintain oil, gas, coal and wood heating systems in residential and commercial buildings. Examples of daily tasks include operating and monitoring heating and ventilation systems. Occupations in this group are primarily engaged in constructing, repairing and renovating buildings and engineering works, and in subdividing and developing land. For example, daily tasks may include undertaking carpentry, plumbing, pipefitting, m asonry, plastering, cement finishing, tile setting, roofing, glazing, painting, insulating, and installing floor covering. Teach basic subjects such as reading, writing and arithmetic or specialised subjects such as a second language at public and private pr imary/elementary schools. Occupations in this group are primarily concerned with teaching. Prepare and teach academic, technical, vocational or specialised subjects at public or private secondary schools. Included in this group are also heads of departments and secondary school librarians. Teach physically or mentally handicapped children, young persons or adults, or those with learning difficulties, at a given level of education. College, university and higher education teaching professionals teach their subjects at some or all levels after the termination of secondary education conduct research and improve or develop concepts, theories and operational methods, and prepare scholarly papers and books. Occupations in this group are primarily concerned with the provision of education services through private institutions. Perform general office clerical duties requiring limited knowledge of office management systems and procedures. For example, daily tasks may include a combination of answering telephones, bookkeeping, office machine operation and filing.

Civil servant clerks Perform the receipt, recording, service and return of civil documents in compliance with department

policy and applicable laws, procedures and time requirements.

Secretaries Perform a variety of administrative duties in support of managerial and professional employers. Examples of daily tasks include scheduling meetings, taking and making calls and word–processing and typing.





Educational lab technicians

Education methods technician


Protective workers, guards, and m essengers

Plan, organise, direct, control and evaluate departments responsible for corporate governance and regulatory compliance, records management, security services, admissions and other adm inistrative services. Conduct research and develop or advise on teaching methods and aids. For example, daily tasks may include conducting research into current developments curricula, teaching methods and other educational practices, and advising on necessary changes and possible improvements. Develop instructional material, co-ordinate educational content, and incorporate current technology in specialised fields that provide guidelines to educators and instructors for developing curricula and conducting courses. Conduct research and develop or advise on teaching methods and aids. Examples of daily tasks may include conducting research into current developments curricula, teaching methods and other educational practices, and advising on necessary changes and possible improvements. Supervise and coordinate the activities of educational professionals and administrative support staff in private education institutions. Occupations in this group are primarily concerned with guarding property against theft and vandalism; controlling access to buildings; and maintaining order and enforcing regulations within a given education institution.

Professionals in law Provide clients with legal advice on a wide variety of subjects and plead cases or conduct

prosecutions in courts of justice, or instruct barristers or advocated to plead in higher courts of justice.

Kindergarten teachers Organise group and individual play and educational activities to support and promote physical,

mental and social development of children below primary school age.

MANUFACTURING SECTOR

Building construction Occupations in this group are primarily engaged in constructing, repair ing and renovating buildings and engineering works, and in subdividing and developing land. For example, daily tasks may include undertaking carpentry, plumbing, pipefitting, masonry, plastering, cement finishing, tile setting, roofing, glazing, painting, insulating, and installing floor covering.

Metal productions Primarily engaged in manufacturing ornamental and architectural metal products such as ducts,

sheet metal, fire escapes, studs etc.

Moulding mechanics Set up, operate, or tend metal moulding, casting or core–making machines to mould or cast metal products.

Engine operators Operate and maintain various types of engines and auxiliary equipment to provide heat, light, power

and other utility services for commercial, industrial and institutional buildings and other work sites.

Electrical equipment and instruments assembly

Equipment and instruments assembly

Mechanical equipment and assembly occupations


Electronics assemblers and fabricators assemble and fabricate electronic equipment, parts and components. Occupations in this group are primarily concerned with assembling and fabricating transportat ion equipment; machinery; electronic equipment; electrical products; furniture and fixtures; fabric, fur and leather products; and other products requiring assembly or fabrication. Assemblers in this occupational group assemble a wide variety of mechanical products such as trucks, buses, snowmobiles, garden tractors, automotive engines, transmissions, outboard motors, gearboxes, hydraulic pumps and sewing machines. Primarily concerned with supervising a specific area of work of workers engaged in processing metals, petroleum, chemicals, rubber and plastics, food and beverages, textiles, workers engaged in assembly and fabrication of transport equipment and other products requiring assembly or fabrication.

Salesmen Sell various goods on a wholesale basis including installations, equipment and technical products

and related services, and provide specialised information as required.


Perform general office clerical duties requiring limited knowledge of office management systems and procedures. For example, daily tasks may include a combination of answering telephones, bookkeeping, office machine operation and filing.





Administrative specialists

Accounting and finance clerks


Administrative m anager

Oversee and implement administrative procedures, establish work priorities and co-ordinate the acquisition of administrative services such as office space, supplies and security services. Obtain, compile and compute statistical or actuarial data or perform clerical tasks relating to financial transactions. Daily tasks may include preparing financial documents, and calculating interest or brokerage charges and stamp duties payable. Plan, organise, direct, control and evaluate the operations of a privately–owned manuf actur ing establishment or of a production department within a manufacturing establishment, under the direction of a general manager or other senior manager. Plan, organise, direct, control and evaluate departments responsible for corporate governance and regulatory compliance, records management, security services, admissions and other adm inistrative services.

Other managers Plan, organise, direct, control and evaluate the operations of a manufacturing establishment or of a

production department within a manufacturing establishment, under the direction of a general manager or other senior manager.

Industrial engineer Design, develop, test, and evaluate integrated systems for managing industrial production

processes including human work factors, quality control, inventory control, logistics and material flow, cost analysis, and production coordination.

Civil engineering and survey technicians


Apply theory and principles of civil engineering in planning, designing, and overseeing construction and maintenance of structures and facilities under the direction of engineering staff or physical scientists. Provide technical support and services to scientists, engineers and other professionals in relation to various types of engineering research, as well as with the design, manufacture, assembly, construction, operation, maintenance and repair of machines, structures and systems.

PUBLIC ADMINISTRATION SECTOR

Professionals in law Provide clients with legal advice on a wide variety of subjects and plead cases or conduct

prosecutions in courts of justice, or instruct barristers or advocated to plead in higher courts of justice.

Professionals in insurance

Professionals in systems analysis

Professionals in accounting

Professionals in econom ics

Human resources specialists

Trade and construction positions

Advise on and sell life, accident, automobile, liability, endowment, f ire, marine and other types of insurance to new and established clients. Provide assistance to users of computers and standard software systems at installation and when problems occur, install new computer programs on particular hardware and operating systems configurations, install new peripheral units, and maintain and update existing programs by m aking minor changes and adjustments to them. Provide advice on accounting matters and perform accountancy services or audits. For example, daily tasks may include planning and installing budgetary, accounts controlling and other accounting policies and systems, and preparing tax retu rns. Conduct research to improve or develop economic concepts, theories and operational methods used to understand and describe the behaviour of national and international markets for goods, services and labour, and advise on or apply the knowledge to draw up economic policies and to formulate solutions to present or projected economic problem s. Examples of daily tasks include advising on economic policy and course of action, preparing scholarly papers and reports, and studying and advising on various economic aspects such as fiscal and pricing policies, employment, income and productivity. Develop, implement and evaluate human resources and labour relations policies, programs and procedures and advise managers and employers on personnel matters. Occupations in this group are primarily concerned with carpentry, plumbing, pipefitting, masonry, plastering, cement finishing, tile setting, roofing, glazing, painting, insulating, and installing floor covering.

Service workers A person who works in the service sector of the econom y.




Unskilled workers Workers with limited to no technical skills or training.

Engineers Perform technical tasks connected with various types of engineering research, as well as with the design, manufacture, assembly, construction, operation, maintenance and repair of machines, structures and systems.

Civil and survey engineers

Perform engineering duties in planning, designing, and overseeing construction and maintenance of building structures, and facilities, such as roads, railroads, airports, bridges, harbours, channels, dams, irrigation projects, pipelines, power plants, water and sewage systems, and waste disposal units.

Electrical engineers Design, develop, test, or supervise the manufacturing and installation of electrical equipm ent,

components, or systems for commercial, industrial, military, or scientific use.

Electronics engineers Research, design, develop, and test electronic components and systems for commercial, industrial, military, or scientific use utilising knowledge of electronic theory and materials properties. D esign electronic circuits and components for use in fields such as telecommunications, aerospace guidance and propulsion control, acoustics, or instruments and controls.

Chemical engineers Design chemical plant equipment and devise processes for manufacturing chemicals and products,

such as gasoline, synthetic rubber, plastics, detergents, cement, paper, and pulp, by applying principles and technology of chemistry, physics, and engineering.

Industrial engineers Design, develop, test, and evaluate integrated systems for managing industrial production

processes including human work factors, quality control, inventory control, logistics and material flow, cost analysis, and production coordination.


Plan, organise, direct, control and evaluate departments responsible for corporate governance and regulatory compliance, records management, security services, admissions and other adm inistrative services.

Civil servant clerks Performs the receipt, recording, service and return of civil documents in compliance with

department policy and applicable laws, and communicates with attorneys and the courts regarding schedules, procedures and time requirements.





Oversee and implement administrative procedures, establish work priorities and co-ordinate the acquisition of administrative services such as office space, supplies and security services. Performs general office clerical duties requiring limited knowledge of office management systems and procedures. For example, daily tasks may include a combination of answering telephones, bookkeeping, office machine operation and filing. Provide technical support and services to scientists, engineers and other professionals in relation to various types of engineering research, as well as with the design, manufacture, assembly, construction, operation, maintenance and repair of machines, structures and systems. Occupations in this group are primarily concerned with supervising a specific areas of work conducted by workers engaged in planning, developing and administering policies and programs in areas such as science, health care, education, recreation and sports, and areas unique to government.

Heads of sections Plan, direct and coordinate an area of activity of an enterprise or organisation concerning

government administration and other operations, public education services, heath and social work services, recreational, cultural and sporting events and services, and operations, in consultation with managers of other departments and sections. Examples of daily tasks include planning, directing and coordinating government operations concerning public service activit ies, such as various government business regulations, civil service administration, and public order and safety activities.

TRADE SECTOR

Consumer goods salesmen

Sell, rent or lease a range of technical and non-technical goods and services directly to consumers.

Salesmen Buy and sell commodities, usually in bulk, at auctions of the spot or future markets.

For example, daily tasks may include establishing contact between buyers and sellers of commodities, obtaining cargo space and fixing and collecting freight charges from clients.





Performs general office clerical duties requiring limited knowledge of office management systems and procedures. For example, daily tasks may include a combination of answering telephones, bookkeeping, office machine operation and filing.

Secretaries Perform a variety of administrative duties in support of managerial and professional employers.

Examples of daily tasks include scheduling meetings, taking and making calls and word–processing and typing.



Protective workers, guards and m essengers


Food industry occupations


Oversee and implement administrative procedures, establish work priorities and co-ordinate the acquisition of administrative services such as office space, supplies and security services. Plan, organise, direct, control and evaluate departments responsible for corporate governance and regulatory compliance, records management, security services, admissions and other adm inistrative services. Occupations in this group are primarily concerned with guarding property against theft and vandalism; controlling access to buildings; and maintaining order and enforcing regulations within a given business. Plan, direct and coordinate those activities of a privately–owned enterprise which are concerned with trade, under the guidance of more senior managers and managers of other departments of sections. For example, daily tasks may include supervising other workers, and overseeing the implementation of operational and administrative procedures. Occupations in this broad occupational group are primarily concerned with the manufacturing and wholesaling of food products and/or food preparation and serving. Plan, direct and coordinate those activities of a privately–owned enterprise which are concerned with trade, in consultation with managers of other departments of sections and under the broad guidance of directors. For example, daily tasks may include ensuring the efficient use of resources and fulfilment of trade quotas, and representing the department in its dealings with other parts of the enterprise or with outside bodies.

General section heads Plan, direct and coordinate those activit ies of an enterprise which are concerned with trade, in

consultation with managers of other departments of sections and under the broad guidance of directors. For example, daily tasks may include ensuring the efficient use of resources and fulfilment of trade quotas, and representing the department in its dealings with other parts of the enterprise or with outside bodies.

Professional human resource occupations

Tailors and dress m akers

General cleaning workers

Transport and road vehicle driving occupations

Carpenters & decorators

Sales/Purchasing mediation occupations

Industrial and office equipment installation


Develop, implement and evaluate human resources and labour relations policies, programs and procedures and advise managers and employers on personnel matters. Make suits, dresses and other garments from textile fabrics, leather or any other material, carry out alterations and repairs, or participate in the manufacture of ready–to–wear garments. Clean and refurbish building exteriors, carpets, chimneys, industrial equipment, ventilation systems, windows and other surfaces, using specialised equipment and techniques. Occupations in this group are primarily concerned with operating trucks, buses, subway trains, street cars and taxis; operating trains; working in railway yards and maintaining tracks; crewing ships and operating boats; operating locks; and loading and unloading aircraf t.

Cut, shape, assemble, erect, maintain and repair various types of wooden structures and f ittings. For example, daily tasks may include constructing, erecting and installing heavy–framed wooden structures on building sites and assembling and altering wooden fixtures. Occupations in this broad occupational category are primarily concerned with selling goods and services and providing personal, protective, household, and tourism and hospitality services. Fit, install, examine, service and repair engines, agricultural or industrial machinery and equipment. Occupations in this group are primarily concerned with carpentry, plumbing, pipefitting, masonry, plastering, cement finishing, tile setting, roofing, glazing, painting, insulating, and installing floor covering.




TRANSPORT AND LOGISTICS SECTOR

Transport and road vehicle driving occupations

Airport services occupations

Airline cabin crew occupations

Occupations in this group are primarily concerned with operating trucks, buses, subway trains, street cars and taxis; operating trains; working in railway yards and maintaining tracks; crewing ships and operating boats; operating locks; and loading and unloading aircraf t. Occupations in this group are primarily engaged in providing services to ensure the safety and comfort of passengers aboard aircraft or within the terminal. Examples of occupations include flight attendants, baggage porters, air traffic controllers and aircraft equipment safety inspectors. Render personal service to ensure the comfort and safety of passengers, serve meals and beverages and coordinate housekeeping activities on aircraft.

Pilots Control the operation of mechanical, electrical and electronic equipment, in order to navigate

aircraft for transporting passengers, mail and freight and perform related pre–flight and in–f light tasks.

Engineers and engineering technicians


Perform technical tasks connected with various types of engineering research, as well as with the design, manufacture, assembly, construction, operation, maintenance and repair of machines, structures and systems. Perform engineering duties in planning, designing, and overseeing construction and maintenance of building structures, and facilities, such as roads, railroads, airports, bridges, harbours, channels, dams, irrigation projects, pipelines, power plants, water and sewage systems, and waste disposal units.

Mechanical engineers Perform engineering duties in planning and designing tools, engines, machines, and other

mechanically functioning equipm ent. Examples of daily tasks include overseeing installation, operation, maintenance, and repair of such equipment as centralised heat, gas, water, and steam system s.

Electronics engineers Research, design, develop, and test electronic components and systems for commercial, industrial,

military, or scientific use utilising knowledge of electronic theory and materials properties. Design electronic circuits and components for use in fields such as telecommunications, aerospace guidance and propulsion control, acoustics, or instruments and controls.

Industrial engineers Perform engineering duties in planning, designing, and overseeing construction and maintenance of

building structures, and facilities, such as roads, railroads, airports, bridges, harbours, channels, dams, irrigation projects, pipelines, power plants, water and sewage systems, and waste disposal units.



Provide technical support and services to scientists, engineers and other professionals in relation to various types of engineering research, as well as with the design, manufacture, assembly, construction, operation, maintenance and repair of machines, structures and systems. Perform general office clerical duties requiring limited knowledge of office management systems and procedures. For example, daily tasks may include a combination of answering telephones, bookkeeping, office machine operation and filing.

Supervisor of sections Occupations in this group are primarily concerned with supervising trades and transport workers.

Heads of sections Plan, direct and coordinate an area of activity of an enterprise which is concerned with providing transportation services, in consultation with managers or other department or sections. Examples of daily tasks include controlling expenditure, representing the department in its dealings with other parts of the enterprise or with outside bodies, and the supervising of other workers.



Logistics and freight occupations

Operate and maintain various types of stationary engines and auxiliary equipment to provide heat, light, power and other utility services for commercial, industrial and institutional buildings and other work sites. Plan, direct and coordinate those activities of an enterprise which are concerned with providing transportation services, in consultation with managers or other department or sections. Examples of daily tasks include controlling expenditure, representing the department in its dealings with other parts of the enterprise or with outside bodies, and the supervising of other workers. Occupations in this sector are primarily engaged in transporting passengers and goods, warehousing and storing goods and providing services to these establishments. The modes of transport include road (trucking, transit and ground passenger), rail, water, air and pipeline.




Ship captains Command or supervise operations of ships and water vessels, such as tugboats and ferryboats that travel in and out of harbours, estuaries, straits, and sounds and on rivers, lakes, bays and oceans. Required to hold a licence in most countr ies.

Professionals in flying and navigation

Sea navigation technicians

Occupations in this category are primarily engaged in piloting and navigating the flight of multi– engine aircraft in regularly scheduled services for the transport of passengers and cargo. Command and navigate ships and similar vessels, and perform related functions on shore. For example, daily tasks may include navigating vessels into and out of ports, and ensuring safe loading and unloading of cargo.

Salesmen Sell services to businesses or individuals, and provide specialised information as required.

Examples of daily tasks include soliciting orders and selling services to retail, industrial, wholesale and other establishments, and providing prospective customers with general and specialised information about the service’s use.



Sell, rent or lease a range of technical and non-technical goods and services directly to consumers. Directly supervise and coordinate the activities of transportation and material–moving machine and vehicle operators and helpers.

Industrial managers Supervise and coordinate the activities of production and operating workers, such as machine

setters and operators, assemblers, fabricators and plant and system operators.

Transport, road vehicle and agricultural equipment repair

Mechanical equipment and instrument assembly

Occupations in this group are primarily concerned with installing, diagnosing, or repairing electronic, electrical and mechanical equipment for the transport and agricultural sectors. For example, daily tasks may include working with diesel engines for all both private and commercial transportation, or repairing avionics equipment such as radar, radio navigation and missile control systems in aircraft. Occupations in this group are primarily concerned with installing, overhauling, repairing or maintaining industrial machinery, refrigeration and air-conditioning equipment, railway rolling stock, aircraft and elevators .

Secretaries Perform a variety of administrative duties in support of managerial and professional employers.

Examples of daily tasks include scheduling meetings, taking and making calls and word–processing and typing.

INFORMATION COMMUNICATIONS TECHNOLOGY SECTOR



Electronics technicians Apply electrical and electronic theory and related knowledge, usually under the direction of

engineering staff, to design, build, repair, calibrate, and modify electrical components, circuitry, controls, and machinery for subsequent evaluation and use by engineering staff in making engineering design decisions



M echanical technicians

Accounting finance clerks

Sell, rent or lease a range of technical and non-technical goods and services directly to consumers. Provide technical support and services to scientists, engineers and other professionals in relation to various types of engineering research, as well as with the design, manufacture, assembly, construction, operation, maintenance and repair of machines, structures and systems. Apply theory and principles of mechanical engineering to modify, develop, and test machinery and equipment under direction of engineering staff or physical scientists. Obtain, compile and compute statistical or actuarial data or perform clerical tasks relating to financial transactions. Daily tasks may include preparing financial documents, and calculating interest or brokerage charges and stamp duties payable.

Mechanical engineers Perform engineering duties in planning and designing tools, engines, machines, and other

mechanically functioning equipm ent. Examples of daily tasks include overseeing installation, operation, maintenance, and repair of such equipment as centralised heat, gas, water, and steam system s.




Electronics engineers Research, design, develop, and test electronic components and systems for commercial, industrial, military, or scientific use utilising knowledge of electronic theory and materials properties. D esign electronic circuits and components for use in fields such as telecommunications, aerospace guidance and propulsion control, acoustics, or instruments and controls.



Admin & administrative developm ent specialists

Research, develop and implement information systems development plans, policies and procedures and provide advice on a wide range of information systems issues. Examples of daily tasks include modifying, integrating and testing computer systems. Performs general office clerical duties requiring limited knowledge of office management systems and procedures. For example, daily tasks may include a combination of answering telephones, bookkeeping, office machine operation and filing. Oversee and implement administrative procedures, establish work priorities and co-ordinate the acquisition of administrative services such as office space, supplies and security services.

CONSTRUCTION SECTOR


Equipment & instruments assembly



Protective workers, guards & messengers





Civil engineering & survey technicians


Occupations in this group are primarily concerned with carpentry, plumbing, pipefitting, masonry, plastering, cement finishing, tile setting, roofing, glazing, painting, insulating, and installing floor covering. Occupations in this group are primarily concerned with assembling and fabricating transportation equipment; machinery; electronic equipment; electrical products; furniture and fixtures; fabric, fur and leather products; and other products requiring assembly or fabrication. Perform general office clerical duties requiring limited knowledge of office management systems and procedures. For example, daily tasks may include a combination of answering telephones, bookkeeping, office machine operation and filing. Provide advice on accounting matters and perform accountancy services or audits. For example, daily tasks may include planning and installing budgetary, accounts controlling and other accounting policies and systems and preparing tax returns. Occupations in this group are primarily concerned with guarding property against theft and vandalism; controlling access to buildings; and maintaining order and enforcing regulations within a given business. Sell, rent or lease a range of technical and non-technical goods and services directly to consumers. Plan, direct and coordinate those activities of a privately–owned enterprise which are concerned with construction work, under the guidance of more senior managers and managers of other departments or sections. Examples of daily tasks include planning and directing daily production operations, overseeing the application of work and safety procedures, and ensuring the efficient use of resources and the fulfilment of production quotas. Provide technical support and services to scientists, engineers and other professionals in relation to various types of engineering research, as well as with the design, manufacture, assembly, construction, operation, maintenance and repair of machines, structures and systems. Plan, organise, direct, control and evaluate departments responsible for corporate governance and regulatory compliance, records management, security services, admissions and other adm inistrative services. Apply theory and principles of civil engineering in planning, designing, and overseeing construction and maintenance of structures and facilities under the direction of engineering staff or physical scientists. Perform engineering duties in planning, designing, and overseeing construction and maintenance of building structures, and facilities, such as roads, railroads, airports, bridges, harbours, channels, dams, irrigation projects, pipelines, power plants, water and sewage systems, and waste disposal units.






Stationary engineers and auxiliary equipment operators operate and maintain various types of stationary engines and auxiliary equipment to provide heat, light, power and other utility services for commercial, industrial and institutional buildings and other work sites. Plan, direct and coordinate those activities of a privately–owned enterprise which are concerned with construction work, in consultation with managers of other departments or sections. Examples of daily tasks include planning and directing daily production operations, overseeing the application of work and safety procedures, and ensuring the efficient use of resources and the fulfilment of production quotas.

Electrical technicians Apply electrical and electronic theory and related knowledge, usually under the direction of

engineering staff, to design, build, repair, calibrate, and modify electrical components, circuitry, controls, and machinery for subsequent evaluation and use by engineering staff in making engineering design decisions.

Architect engineers Person qualified as both an architect and an (usually civil) engineer.

TELECOMMUNICATIONS SECTOR

Salesmen Sell various goods and services on a wholesale or retail basis including installations, equipment and

technical products and related services, and provide specialised information as required.

Sales/purchasing m ediation


Installation, maintenance and repair occupations

Occupations in this broad occupational category are primarily concerned with selling goods and services. Sell, rent or lease a range of technical and non-technical goods and services directly to consumers. Repair, test, adjust or install equipment such as industrial machinery, vehicles, and electrical and electronic equipment.

Financial analysts Collect and analyse financial information such as trading volumes and the movement of capital,

financial backgrounds of companies, historical performances and future trends of stocks, bonds and other investment instruments to provide financial and investment or financing advice for their company or their company's clients.

Examples of daily tasks include studying and evaluating takeover bids, private placements and mergers and acquisitions.

Human resource specialists

Market research analysts



Develop, implement and evaluate human resources and labour relations policies, programs and procedures and advise managers and employers on personnel matters. Engage in studying, advertising on and applying operational methods relating to various aspects of business undertakings such as marketing, advertising, public relations, or steps to be taken in setting up and running a business. Examples of daily tasks include planning, advising on or directing production of advertising campaigns and conducting research and determining or advising on existing levels of sales for particular products or services. Plan, direct and coordinate the activities of a privately–owned enterprise which are concerned with providing communications services to external businesses and individuals, in consultation with managers of other departments or sections, or more senior managers. Examples of daily tasks include supervising other workers and establishing and directing operational and administrative procedures. Occupations in this group are primarily concerned with supervising a specific area of work conducted by workers engaged in installing, maintaining, testing and repairing industrial and private use telecommunication services such as repairing and maintaining power transmission and telecommunications lines, and maintaining television services .

Commercial managers Plan, direct, and coordinate those activities of an enterprise which are concerned with com m ercial

telecommunications services, under the guidance of more senior managers and managers of other departments or sections. Examples of daily tasks include supervising other workers, and ensuring the fulfilment of commercial sales quotas.





Occupation Definition Heads of sections Plan, direct and coordinate an area of activity of an enterprise which is concerned with providing

telecommunications services to external businesses and individuals, in consultation with managers of other departments or sections. Examples of daily tasks include representing the department in its dealings with other parts of the enterprise or with outside bodies, supervising other workers and establishing and direct ing operational and administrative procedures.

Other managers Plan, direct and coordinate the activities of an enterprise which are concerned with providing

communications services to external businesses and individuals, under the guidance of more senior managers and managers of other departments or sections.


Secretaries



Perform general office clerical duties requiring limited knowledge of office management systems and procedures. For example, daily tasks may include a combination of answering telephones, bookkeeping, office machine operation and filing.

Perform a variety of administrative duties in support of managerial and professional employers. Examples of daily tasks include scheduling meetings, taking and making calls and word–processing and typing.

Research, develop and implement information systems development plans, policies and procedures and provide advice on a wide range of information systems issues. Examples of daily tasks include modifying, integrating and testing computer systems.

Provide technical support and services to scientists, engineers and other professionals in relation to various types of engineering research, as well as with the design, manufacture, assembly, construction, operation, maintenance and repair of machines, structures and systems.

TOURISM AND HOSPITALITY SECTOR Salesmen Establish business contacts, sell business services such as advertising space in the media, tourism

and hospitality services (such as accommodation, travel packages) services, and other facilities, credit and other business information. Examples of daily tasks include obtaining information about services to be sold and needs of prospective buyers and negotiating contracts on behalf of seller or buyer and explaining terms of sale and payment to client.

Consumer goods Sell, rent or lease a range of technical and non-technical goods and services directly to consum ers. salesm en

Stewards Travel attendants and travel stewards ensure the comfort and safety of passengers, serve meals

and beverages and render personal services, usually on aircraft and onboard ships. They may plan and coordinate housekeeping and social activit ies

Food and beverage Preparing ingredients and performing other duties to prepare or serve food and beverages. staff

Tourist services clerks This broad occupational group are primarily concerned with quoting fares and rates, m aking

reservations, issuing tickets, processing cargo shipments, checking baggage and perform other related customer service duties to assist travellers. They can also be involved in escorting individuals and groups on trips, on sightseeing tours and providing background information on interesting landmarks on these tours.

Tourism managers Hospitality, shop and related services managers plan, organize and direct the operations of

establishments which provide accommodation, hospitality, retail and other services

Protective workers & Occupations in this group are primarily concerned with guarding property against theft and messengers vandalism; controlling access to buildings; and maintaining order and enforcing regulations within a

given business.




Manpower specialists Develop, implement and evaluate human resources and labour relations policies, programs and procedures and advise managers and employers on personnel matters.


Mechanical & office precision instrum ents m aintenance


Plan, direct and coordinate the activities of a privately–owned enterprise which are concerned with providing tourism and/or hospitality services Examples of daily tasks include supervising other workers and establishing and directing operational and administrative procedures. Service and repair off ice mechanical and electrical equipment. They are employed by repair shops, appliance service companies. Examples of daily tasks include repair ing photocopy machines and fax machines. Plan, direct and coordinate those activities of a privately–owned enterprise which are concerned with providing tourism and/or hospitality services, in consultation with managers of other departments of sections and under the broad guidance of directors. For example, daily tasks may include ensuring the efficient use of resources and fulfilment of service quotas, and representing the department in its dealings with other parts of the enterprise or with outside bodies.

Heads of sections Plan, direct and coordinate an area of activity of an enterprise which is concerned with providing

tourism and/or hospitality services, in consultation with managers or other department or sections. Examples of daily tasks include controlling expenditure, representing the department in its dealings with other parts of the enterprise or with outside bodies, and the supervising of other workers.


Food industry occupations

Plan, organise, direct, control and evaluate departments responsible for corporate governance and regulatory compliance, records management, security services, admissions and other adm inistrative services. Occupations in this broad occupational group are primarily concerned with the manufacturing and wholesaling of food products and/or food preparation and serving.

Waiters Waiters serve food and beverages in commercial dining and drinking places, clubs, institutions and

canteens.

Sales and purchasing Occupations in this broad occupational category are primarily concerned with selling goods and services and providing personal, protective, household, and tourism and hospitality services.

Industrial managers Supervise and coordinate the activities of production and operating workers, such as machine

setters and operators, assemblers, fabricators and plant and system operators.

Civil servant clerks Perform the receipt, recording, service and return of civil documents in compliance with department policy and applicable laws, procedures and time requirements.



Perform general office clerical duties requiring limited knowledge of office management systems and procedures. For example, daily tasks may include a combination of answering telephones, bookkeeping, office machine operation and filing. Occupations in this group are primarily concerned with supervising a specific area of work conducted by workers engaged in tourism and/or hospitality services.


tourism and/or hospitality services, in consultation with managers or other department or sections. Examples of daily tasks include controlling expenditure, representing the department in its dealings with other parts of the enterprise or with outside bodies, and the supervising of other workers.

BANKING AND FINANCE SECTOR

Bank teller (front office)


Commercial & financial business managers

Bank tellers deal directly with clients of banks in connection with receiving, changing and paying out money. Examples of daily tasks include receiving money or cheques from clients, crediting and debiting clients’ accounts and changing money from one currency to another. Perform general office clerical duties requiring limited knowledge of office management systems and procedures. For example, daily tasks may include a combination of answering telephones, bookkeeping, office machine operation and filing. Plan, organise, direct, control and evaluate the activities of financial establishments or operational departments within such establishments. They oversee business development and manage overall performance in accordance with established strategic directions and policies.

Other managers Plan, direct and coordinate activities of production, operation and/or personnel involved in the



provision of banking and finance services.

Sales and purchasing occupations


Occupations in this broad occupational category are primarily concerned with promoting and providing financial services. Conduct research, develop and implement information systems development plans, policies and procedures, and provide advice on a wide range of information systems issues.


banking and finance services, in consultation with managers or other department or sect ions. Examples of daily tasks include controlling expenditure, representing the department in its dealings with other parts of the enterprise or with outside bodies, and the supervising of other workers.

Protective workers, guards and m essengers

Occupations in this group are primarily concerned with guarding property against theft and vandalism; controlling access to buildings; and maintaining order and enforcing regulations within a given business.

Secretaries Perform a variety of administrative duties in support of managerial and professional employees. Examples of daily tasks include scheduling meetings, taking and making calls and word–processing and typing.

Professionals in corporate banking

Financial consultant (front office)

Administrative developm ent specialists



Accounting and finance clerks

Professionals in insurance — underwriter

Professionals in private banking

Professionals in retail banking


Professionals in internal audit

Occupations in this group are primarily concerned with providing financing, cash management and other banking services custom-tailored for large corporations or firms. Advise clients on financial plans utilising knowledge of investment strategies, securities, insurance, pension plans, and real estate. Duties include assessing clients' assets, liabilities, cash flow, insurance coverage, and financial objectives to establish investment strategies. Oversee and implement administrative procedures, establish work priorities and co-ordinate the acquisition of administrative services such as office space, supplies and security services. Plan, organise, direct, control and evaluate departments responsible for corporate governance and regulatory compliance, records management, security services, admissions and other adm inistrative services Provide advice on accounting matters and perform accountancy services or audits. For example, daily tasks may include planning and installing budgetary, accounts controlling and other accounting policies and systems and preparing tax returns. Obtain, compile and compute statistical or actuarial data or perform clerical tasks relating to financial transactions. Daily tasks may include preparing financial documents, and calculating interest or brokerage charges and stamp duties payable. Review individual applications for insurance to evaluate degree of risk involved and determine acceptance of applications. Advise clients with significant personal wealth on financial plans, utilising knowledge of tax and investment strategies, securities, insurance, pensions plans and real estate. Examples of daily tasks include assessing clients' assets, liabilities, cash f low, insurance coverage, tax status, and financial objectives to establish investment strategies. Occupations in this group are primarily concerned with servicing individual customers who use local branches of larger commercial banks. Examples of daily tasks include checking savings and cheque accounts, issuing mortgages, personal loans, debit cards, credit cards and so forth. Occupations in this group are primarily concerned with supervising a specific area of work conducted by workers engaged in banking and finance services. Compute, classify, and record numerical data to keep financial records complete. Perform any combination of routine calculating, posting, and verifying duties to obtain primary financial data for use in maintaining accounting records. May also check the accuracy of figures, calculations, and postings pertaining to business transactions.

Investment analysts An investment analyst undertakes research to provide ideas and information to fund managers. The

information they provide enables the fund manager to make decisions relating to the investment portfolios that they manage.



Manpower (human Develop, implement and evaluate human resources and labour relations policies, programs and resources) specialists procedures, and advise managers and employers on personnel matters.

Risk manager – An Operational Risk Manager oversees an institution’s operational risk including the risk of loss Operational risk resulting from inadequate or failed internal processes and systems, human factors, or from external

events. Risk manager – Market risk

Risk manager – Credit risk

Market risk managers analyse and manage the risk of losses arising from adverse movements in market prices and factors (e.g. equity risk, interest rate risk, currency risk, commodity risk). Using the Value at Risk methodology they model, for a given trading portfolio, the maximum amount that a bank could lose over a specific time period with a given probability.

Credit Risk Managers analyse the risk of loss due to a debtor's non-payment of a loan or other line of credit, i.e. the risk that loans will not be repaid. They rank potential and existing customers according to risk, and then apply appropriate risk mitigation strategies.

Source: Definitions compiled from (International Labor Organization 2001); (Bureau of Labor Statistics (US) 2000); and (Statistics Canada 2006).



Appendix C

Labour market analysis — information sources

C.1 Sources used as part of the labour market analysis

Civil Service Bureau (CSB), Kingdom of Bahrain, Spreadsheet of employees by ministry and citizenship, 2002 to 2008.

General Organisation for Social Insurance (General Organization for Social Insurance (GOSI)), Kingdom of Bahrain, Extract from GOSI database as at June 2008.

Labour Market Regulatory Authority (LMRA), Kingdom of Bahrain, based on data from Bahrain Labour Market Indicators website http://www.lmra.bh/blmi."

Labour Market Regulatory Authority (LMRA), Kingdom of Bahrain, based on data from Bahrain Labour Market Indicators website http://www.lmra.bh/blmi." Tables A, A1, A2, A06, A07

Labour Market Regulatory Authority (LMRA), Kingdom of Bahrain, based on data from Bahrain Labour Market Indicators website http://www.lmra.bh/blmi. Establishment survey on wage structure and distribution, March 2006.

Labour Market Regulatory Authority (LMRA), Kingdom of Bahrain, based on data from Bahrain Labour Market Indicators website http://www.lmra.bh/blmi. Table 04.

http://www.lmra.bh/blmi






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