Strategic Responses of the Private Sector Employers towards Jobs Localization: A Case of Saudi Arabia

Abstract

Employers in the private sector in Saudi Arabia are under increasing institutional pressure to localize jobs. The strategic responses of employers to these pressures vary, so this study came to identify those responses and the factors that affect them using the Oliver (1991) classification of strategic responses Model. The study was applied to the industrial sector using a questionnaire distributed to a sample of 470 industrial establishments.

The results showed that the large size of the organization has a positive impact on increasing job localization is not supported. However, the results reinforced the study's predictions that the high percentage of foreign employees in leadership positions reflects negatively on the extent of the employer's commitment to localization. The results also confirmed that if the effectiveness of formal oversight of employers increased to ensure the extent of commitment to localization, the more responsive they were to lot of jobs. And that the more employers monitor the localization practices and standards in the same industrial, the greater the commitment of employers to Saudization.

The study also found that the importance of the employer's expectations of the Saudis'  technical and practical capabilities when he makes decisions regarding the localization of jobs and that these capabilities actually reflect on productivity .

Finally, the results of the study supported the hypothesis that the degree of the employer's commitment to localizing jobs is only a reflection of the balance of power between the size of  The institutional pressure exerted on them to localize jobs and the amount of perceived technical capabilities that they expect from employing Saudis.

The study presented a set of recommendations and suggestions at the practical level, perhaps the most important of which is the need to enhance partnership and cooperation with the private sector for the success of job Localization efforts and the need for employers to give their opinion and advice when setting new localization standards and laws by the relevant authorities. Also the importance of localization ratios for major companies periodically announce. and developing a strategy for localization of leadership positions in the private sector, as well as a strategy for activities and professions, which suffers from a shortage of qualified Saudi nationals in the private sector, or the unwillingness to work in them. Regarding future research, the study recommends that researchers study the multiple strategies that organizations use to respond to institutional pressures and explore the causal factors for strategic choice for different variables and contexts.