Following the lead of other Gulf Cooperation Council (GCC) countries, the Kingdom of Bahrain is moving toward the Bahrainization of jobs and a reduction in the number of foreigners working in the public and private sectors. This step aims to reduce unemployment, which reached 5.4% by the end of 2022, according to official statistics from the Council of Ministers.
In line with the shift in government policy, many companies in Bahrain are now tending to lay off non-Bahraini employees in jobs that can be filled by citizens, according to their specialization.
The unemployment rate in Bahrain ranged between 3.7% and 4% from 2012 until the pandemic’s outbreak, after which it rose to 7.5%. Since then, the government has succeeded in gradually reducing it to 5.4% and aims to further reduce it to below 3.5%.
According to the data of the Bahraini Public Authority for Social Insurance for the year 2022, 50,000 people work in the government or public sector, while 614,000 work in the private sector. The private sector includes 100,000 Bahrainis and 514,000 foreign workers, most notably from Asian countries (primarily India, Bangladesh, Nepal, the Philippines, and Pakistan) and some African and Arab countries.
Despite Bahrain’s intention to restructure the government, employment in the public sector rose from 48,915 in 2021 to 50,375 in 2022—a 3% increase. Over the same period, it increased in the private sector for Bahrainis from 96,934 to 99,945—a 3.1% rise.
Recently Bahrain has taken several steps to reduce the number of foreigners working in the kingdom, who annually transfer nearly 1.2 billion Bahraini dinars ($3.2 billion) to their home countries, constituting more than 8% of Bahrain’s gross domestic product.
About 72% of non-Bahraini employees in the private sector receive salaries and wages falling below 200 BD ($530) per month, working mainly in the carpentry, plumbing, construction, contracting, and construction sectors. Meanwhile, 4% of foreigners working in the private sector receive salaries exceeding 1,000 BD ($2,700) per month.
The minimum monthly wage for Bahrainis in the private sector is 350 BD ($930) for those with a high school diploma, and 450 BD ($1,200) for those with a university degree, while the government has raised the minimum wage for some professions such as medicine and engineering in the private sector.
For years, Bahrain has followed a policy of subsidizing wages for Bahraini citizens in the private sector. The country’s Labor Market Regulatory Authority charges employers a monthly fee of 10 BD ($26.60) for each foreign worker, which is then transferred to the Labor Fund, or Tamkeen.
Tamkeen is a Bahraini-innovated institution that aims to support the wages, training, and rehabilitation of citizens. In addition, it supports startups founded by Bahrainis by paying half of the costs of the equipment they need.
Over the past years, members of the Council of Representatives (the lower house in the Bahraini Parliament) have criticized the government for tolerating such a high percentage of foreigners, who as of 2021 comprised 52% of the total population of 1.5 million.
During its negotiations with the government last May on the 2023-2024 budget, the Council of Representatives succeeded in raising the fees paid by the employer to their foreign workers, in addition to further subsidizing the wages of Bahrainis and their employment in the private sector.