2007

Kingdom of Bahrain Labour Fund – Strategic Plan

1. Situation & Aspiration

2. Labour Market Behaviour

3. Strategic Intent

4. Proposed Initiatives

1. Situation & Aspiration

- Quality of Life Index - Measuring our success

2. Labour Market Behaviour

3. Strategic Intent

4. Proposed Initiatives

The quality of life (the living standards) in Bahrain has scored moderate in comparison to similar economies. Accordingly, the Labour Fund’s key aspiration is to elevate Bahrainis standards of living.

Currently, Bahrain’s Quality of Life Index falls within the lowest quartile when compared to similar economies.

High

Targeted Position US A

Quality of Life Index

Cyprus Kuwait

Bahrai n

Qatar

Therefore, the target is to enhance living standards beyond its current standing and to be among the best in the world.

UA E

Low

© Planning & Development – Labour Fund (2007)

Ireland

Low

High GDP US$ (PPP)

Source: Economic Intelligence Unit – Quality of Life Index 2005

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2007

2010

Executive Management

2010

Job Opportunities

© Planning & Development – Labour Fund (2007)

To raise Bahrainis standard of living, it is important that value added jobs are being occupied by Bahraini Human Capital.

Middle Management

2007

2007 2010

Raising Bahrainis standard of living would require:  Improving the skills set of Bahraini human capital  Position Bahrainis in higher level jobs.

Supervisory Level

2007 2010 Subordinate Level 0

200

500

800 1100 1400 Average Wages (BD per Month)

4000

5000

5

1. Situation & Aspiration

2. Labour Market Behaviour

- Labour Market Driving Forces -Labour Market Policies -Talent Pool -Market/Business Performance

3. Strategic Intent

4. Proposed Initiatives

© Planning & Development – Labour Fund (2007)

Understanding the challenge of the labour market driving forces is the key to derive the Labour Fund’s strategic plan.

Value Added Jobs

In order to comprehend the labour market dynamics and challenges, a thorough assessment and analysis must be considered in:

1- Labour Market Policies 2- Talent Pool 3- Market conditions & performance

Labour Market Policies

7

Labour Market Driving Forces 1 – Labour Market Policies 2 – Talent Pool 3 – Market/Business Performance

Improving the labour market policies would require setting skill standards and enforcement mechanisms.

© Planning & Development – Labour Fund (2007)

Symptoms

Conditions

Strategic Thrust

 Defined skill standards  Deficiencies in labour law implementation and enforcement

- Absence of formalised skill standards - Recruitment process not linked to competencies

- Improper implementation of Labour Law

Insufficient enforcement and standardisation within the labour system

Current market behaviour indicates lack of:

Improve Labour Market Policies

- Absence of enforcement

Source: 1st Consultative Labour Fund Strategy Forum (December 2006); Labour Market Survey LF (2006)

9

Labour Market Driving Forces 1 – Labour Market Policies 2 – Talent Pool 3 – Market/Business Performance

Enhancing current low Bahraini penetration in vital sectors through upscaling talent, defining standards, and would result in positioning Bahrainis in valueadded jobs.

© Planning & Development – Labour Fund (2007)

Symptoms

Conditions

Strategic Thrust

- Limited career progression - Low wages / benefits - Low work ethics / discipline

- Absence of formalised skill standards - Absence of career development / planning culture

Skill Gap Deficiencies

Optimise Talent Pool

Talent pool assessment indicates Bahrainis are performing low due to low skills and low work ethics and a lack of other factors such as:

 Growth planning  Quality  Defined skill standards have a negative impact as well.

- Talent pool low skills

- Training infrastructure deficiencies

Source: 1st Consultative Labour Fund Strategy Forum (December 2006); Labour Market Survey LF (2006)

11

Providing career counselling, awareness, and channelling are of significance in order to resolve career path and placement challenges.

© Planning & Development – Labour Fund (2007)

Symptoms

Conditions

Strategic Thrust

Bahrain faces structural labour market issues due to lack of:  Job channelling  Career counselling

- Ineffective employment channelling - Long periods of job search

Limited Career Awareness

Optimise Talent Pool

Resulting in ambiguities in employment opportunities for Bahrainis in higher level valueadded jobs.

- Absence of career guidance

Source: 1st Consultative Labour Fund Strategy Forum (December 2006); Labour Market Survey LF (2006)

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An intensive awareness campaign to correct cultural issues is of essence in order to increase penetration in low attractive jobs.

© Planning & Development – Labour Fund (2007)

Symptoms

Conditions

Strategic Thrust

Low job penetration is due to:  Cultural resistance  Gender disparity Is resulting in missing opportunities to place Bahrainis in value-added jobs.

- Gender Disparity

Low Bahraini Penetration

Optimise Talent Pool

- Cultural resistance

Source: 1st Consultative Labour Fund Strategy Forum (December 2006); Labour Market Survey LF (2006)

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Labour Market Driving Forces 1 – Labour Market Policies 2 – Talent Pool 3 – Market/Business Performance

Supporting the private sector to overcome growth challenges will help in fuelling business and employment opportunities.

© Planning & Development – Labour Fund (2007)

Symptoms

Conditions

Strategic Thrust

- Slow privatisation / underutilisation of infrastructure - Slow development of sectors - Under-utilisation of foreign trade agreements - Limited promotion of sectors - Limited marketing efforts - Unclear investment guidance -Undefined direction for sector development

Stagnating Business / Employment Opportunities

Enable Enterprise Growth

Enterprise growth is hindered by challenges related to: Limited business growth and opportunities Government promotional and investment strategies Limited market access

External Issues

- Limited market access - Minimal cross-sector linkages - Limited access to financing

Source: 1st Consultative Labour Fund Strategy Forum (December 2006); Labour Market Survey LF (2006)

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Resolving corporate structural bottlenecks would ensure sustainable and robust business environment which would result in supplying solid value added job opportunities.

© Planning & Development – Labour Fund (2007)

Symptoms

Conditions

Strategic Thrust

- Low technology infusion - Low competitiveness - Absence of R&D - Limited e-commerce - Deficiency in service quality

- Low corporate leadership

Low Business Performance

Enable Enterprise Growth

Internal Issues

Corporations in Bahrain are faced by structural challenges related to performance excellences key issues include; Leadership Strategic direction customer focus Technology infusion Which are resulting in low competitiveness.

- Absence of market leader - Few large players

Source: 1st Consultative Labour Fund Strategy Forum (December 2006); Labour Market Survey LF (2006)

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An assessment of sectors based on GDP contribution, labour intensity, wages, acceptance, and sustainability has revealed that transport & communication, manufacturing, trade…

Transport & Communication

Finance © Planning & Development – Labour Fund (2007)

-

0

+

-

GDP

GDP

Labour

Labour

Wage

Wage

Acceptance

Acceptance

Sustainability

Sustainability

-

Manufacturing 0

+

-

GDP

GDP

Labour

Labour

Wage

Wage

Acceptance

Acceptance

Sustainability

Sustainability

Source: Labour Fund Analysis - 2006

0

Trade 0

+

+

Selected sectors have shown: High GDP contribution Labour intensity Average wages Acceptance; and Sustainability However, the finance sector has not been considered due to its maturity and continued sustainable growth.

17

… social & personal services …

Social & Personal Services © Planning & Development – Labour Fund (2007)

-

0

Real Estate & Business

+

-

GDP

GDP

Labour

Labour

Wage

Wage

Acceptance

Acceptance

Sustainability

Sustainability

Electricity & Water -

0

+

Construction +

-

GDP

GDP

Labour

Labour

Wage

Wage

Acceptance

Acceptance

Sustainability

Sustainability

Source: Labour Fund Analysis - 2006

0

0

+

Only health care of the social and personal services has been selected for its potential to growth due to government intentions to privatize the sector. Real estate, electricity & water, and construction have not been selected due to their low performance.

18

© Planning & Development – Labour Fund (2007)

…as well as tourism have the greatest potential for growth.

Tourism has been selected due to its high potential for growth regardless of its low GDP contribution. -

Tourism 0

Agriculture & Fishing +

-

GDP

GDP

Labour

Labour

Wage

Wage

Acceptance

Acceptance

Sustainability

Sustainability

Source: Labour Fund Analysis - 2006

0

+

While on the other hand, the agriculture and fishing sector has been eliminated to its insignificant GDP contribution and limited potential for growth.

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Bahrain has been experiencing an economic boost mainly fuelled by major projects in key economic sectors. As a result, the Labour Fund should focus on developing talent and establishing strategic links with the upcoming projects.

By 2011, a total of 108 projects , with an estimated value of BD 9.2 billion* (US$ 24.4 billion) are expected to be launched in Bahrain.

45 40

Number of planned projects

© Planning & Development – Labour Fund (2007)

Planned Projects up to the year 2011

35

Transport &

30

Communication

25

Trade

20

Social & Personal

15

Services

10

Tourism

These projects are expected to create approximately 44,000 new jobs over the next 5 years.

Manufacturing

5 0

0 4500

500

1000

1500

2000

2500

3000

3500

4000

Investment ($ Million)

* MEED estimates total investment size at BD 10.7 billion (US$ 28.5 billion) Source: Labour Fund Analysis, Zawya and MEED (2006)

20

© Planning & Development – Labour Fund (2007)

Large-scaled firms are potential employment channels for value-added jobs, hence, enlarging smaller firms is a key strategic direction for the Labour Fund

2501 - 3000

550

470

2001 - 2500

1501 - 2000

410

Size of Company (Number of 1001 - 1500 Employees)

501 - 1000

0 - 500

The wage analysis indicated that Bahrainis tend to earn higher wages as the size of the firm increases.

350

290

250 Average Wages (BD per month )

Source: Labour Fund Analysis, General Organisation for Social Insurance (2005)

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The Labour Fund should ensure that employment pushes are being driven towards value added and financially rewarding jobs.

© Planning & Development – Labour Fund (2007)

High Wage Occupation Categories (Targeted High-end Wages in BD) Manufacturing Maintenance

Transport

Plant Operations

Pilots Aviation Engineers

Inventory Control Engineers

Value-added jobs have been selected on the basis of the highest financially rewarding job categories in the selected sectors.

Air Hosts

Production Procurement

Technician

Telecoms Health

Surgeons GPs

Telecom Engineers Systems Administrator Software & Network Engineers Data Managers

Nutritionists

Operators

Physical Therapists Nursing Pharmacists

Tourism & Lifestyle Recreation

Retail Operations

Trade

Logistics Management

Facilities Management

Source: Labour Fund Analysis, General Organisation for Social Insurance (2005)

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© Planning & Development – Labour Fund (2007)

The Labour Fund would also focus on developing the most rewarding and demanded occupations across sectors

Occupation Clusters Executive

Human Resource

Management

Management

Engineering

Finance

Distribution & Customer Support

In addition to sector specific occupations, the Labour Fund would also focus on crosssectoral occupations due to:  High demand  Rewarding careers

Types of Occupations • Project Supervisory • Program Manager • Administration

• Recruitment • Performance Management • Training • Staff Development

• Electric & Electronic Engineering • Maintenance Engineering • Mechanical Engineering • Civil Engineering • Network & Software Engineering • Process Engineering

• Financial Controlling • Accountancy • Internal Auditing

Source: Labour Fund Analysis, General Organisation for Social Insurance (2005)

• CRM • Communications • Sales • Product Marketing • Branding

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1. Situation & Aspiration

2. Labour Market Behaviour

3. Strategic Intent

- Problem Definition & Ethos - Guiding Principals

4. Proposed Initiatives

PROBLEM DEFINITION & ETHOS

Stagnating wages are fuelling the expansion of the PROBLEM DEFINITION STATEMENT

lower class and diminishing standards of living due to low skill development, low business performance, and poor policy enforcement and standardisation

LABOUR FUND ETHOS

The Labour Fund aspires to improve living standards for Bahrainis through three key pillars: optimising talent, enabling enterprise growth, and improving labour market policies

GUIDING PRINCIPALS

VISION

A Distinguished Career for Prosperous Living

To be an enabler and driver in offering rewarding employment opportunities to attain prosperous living for Bahrainis MISSION

We will work towards developing talented Bahraini competencies, enabling enterprise growth, and improving policies and standards This will be achieved through investing in human capital, supporting growth and development of business activities, and collaborating with key policy and decision makers

OBJECTIVES & STRATEGIES

OBJECTIVES

STRATEGIES



Optimising talent



Enabling enterprise growth



Improving labour market policies



Capitalise & develop value-added Bahraini talent & skills in rewarding careers



Support, develop & attract new industries



Enhance & leverage existing industries

1. Situation & Aspiration

2. Labour Market Behaviour

3. Strategic Intent

4. Proposed Initiatives - Initiatives

Improving, standardising and enforcing labour market policies would assist in resolving the existing challenges

© Planning & Development – Labour Fund (2007)

Strategic Thrust

Objectives

- Systems Standardization

Improve Labour Market Policies

- Policy Enforcement and Utilization - Information Preparedness

Initiatives

National Skills Standardization Program

Two initiatives were developed to assist in improving labour market policies: • National skills standardisation program; and • Employment standards index

Employment Standards Index

29

In order to resolve the challenges, the talent pool can be optimised by tackling skill gaps, career awareness and low Bahraini penetration

© Planning & Development – Labour Fund (2007)

Strategic Thrust

Objectives

Talent Pool Optimization

Skill Standards Enforcement

Initiatives - International Apprenticeship Program - Work Ethics Training & Awareness

-Talent Management Training

Talent Pool - Human Capital Program Development

- Talent Resource Utilization - Knowledge Enforcement

- Specialised Training for Skill Gaps -Training for Career Progression

- Career Market Acceptance & Awareness Campaign

In order to meet the objectives required to improve & develop the talent pool, the Labour Fund has identified a number of initiatives that need to be successfully completed: • International apprenticeship program • Work ethics training & awareness • Talent management training • Specialised training for skill gaps • Training for career progression • Career market acceptance & awareness campaign

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In order to resolve the challenges, enterprise growth can be nurtured by tackling the lack of business and employment opportunities

© Planning & Development – Labour Fund (2007)

Strategic Thrust

Objectives

Market/Resource Optimization

Enterprise External Issues

Sector Profiling

Initiatives

- Diversifying Businesses

- Attracting Investment & Sourcing Talent

- B2B e-Marketplace Venture Proliferation

-Venture Capital Investment

The following initiatives have been identified to over come the issue of stagnating business and employment opportunities:

•Diversifying Businesses operating in Bahrain •Attracting Investment in various sectors •Developing local talent •Improving services provided to businesses operating in Bahrain •Setting up a venture capital fund to promote start up businesses or assist existing businesses to expand and mature

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In order to resolve the challenges, enterprise growth can be nurtured by tackling the lack of business and employment opportunities

© Planning & Development – Labour Fund (2007)

Strategic Thrust

Objectives

Enterprise Competitiveness

Initiatives

- Corporate Performance Excellence (QualityCorp)

Enterprise Internal Issues

Enterprise Management

- Enterprise Growth Management Program

The following initiatives have been identified to over come internal issues facing enterprises: •Improve business competitiveness •Improve the performance of companies and generate extra revenue that can be used for training of employees

•Allow companies to develop and mature

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