Page 205 - Aamir Rehman - Dubai & Co Global Strategies for Doing Business in the Gulf States-McGraw-Hill (2007)

Building Your Team: Human Capital Strategies for the GCC 187

opportunity is impossible without having the right team. This
chapter will explore the critical question of human capital—a mat-
ter that savvy firms must weigh carefully in designing their
approach to the region.

INEVITABLE RELIANCE: WHY THE GULF
HAS NEEDED FOREIGN WORKERS

Gulf labor markets are, to outside observers, anomalies. The major-
ity of the population of three of the six GCC states—the UAE, Qatar,
1
and Kuwait—are expatriates, and the expatriates’ role has been
unambiguous: to provide labor. This labor pool has included senior
executive and other management and professional functions, as
well as basic work such as manual labor and unskilled services.
Spend a day in almost any Gulf country and you will come across a
great number of foreign workers—including hotel staff, taxi driv-
ers, clerks at fast-food and grocery counters, the people pumping
gas at the corner service station, you name it. Visit a hospital or
clinic and you will find expatriate doctors, nurses, and support
staff. Go to a school or university and many, if not most, of the
teachers will be expatriates; even in Arabic-language schools, many
teachers are Egyptian, Lebanese, Syrian, or Iraqi. And don’t forget
the “invisible” expatriate workers such as domestic help and con-
struction workers, without whom neither the economy nor many
people’s homes could function. Few who live in the GCC states, in
fact, could imagine life without the expatriate labor on which the
countries rely. But how did the Gulf end up with such peculiar labor
dynamics?
The answer lies in the unique circumstances of the GCC’s eco-
nomic development (see Figure 7.1). The oil booms of the 1970s
raised GDP per capita abruptly and caused Gulf economies to
leapfrog, in terms of wealth, ahead of other developing countries
without the requisite intermediate steps. In the course of a single
decade, for example, Saudi Arabia’s per capita GDP went from less
than one-fifth of that of the United States to more than one-quarter
higher than the US level—representing a tremendous compound
annual growth rate of 33 percent.
Most countries that have attained prosperity have done so
through more gradual and conventional means, such as building