Priority projects: Investing in youth training and entrepreneurship

The provision of employment opportunities for Oman’s young population has become a primary concern of the government in recent years. While the sultanate has escaped the recent political turbulence that has afflicted other parts of the region, Oman’s median age of 24.1 (compared, for example, to a median age of 40.2 in the UK) underlines the need to address the needs of this segment of the population.

The impetus behind a move by Oman to create jobs for young nationals comes from the top: in February 2011 Sultan Qaboos bin Said Al Said, whilst increasing job seekers allowance to OR150 ($391) per month, issued orders for the creation of 50,000 new jobs for Omani citizens. Ministries have been tasked with achieving this goal, but in doing so have been faced with a second challenge: a young workforce which in many cases lacks the training required by the private sector The announcement by the Ministry of Manpower in the first quarter of 2012 that it had inked 39 agreements worth OR3.5m ($9.1m) to train 1235 Omanis in a range of work skills spoke directly, therefore, to this pressing issue. Students are not the only ones who will gain by the scheme – a wide array of private education institutes specialising in fields such as tourism, mechanical maintenance, hairdressing and administration will benefit from the government-sponsored courses, which are expected to last between six and nine months.

Developing Professional Skills

The Ministry of Manpower’s recent initiative is the latest in a long line of programmes aimed at enhancing the skills of its young workforce, and one of the leading agencies involved with this effort for a number of years has been AIESEC Oman. Established in 2007 as an expansion of AIESEC USA, the organisation’s main activity is to work with school students and recent graduates to develop the professional skills required for employment. It achieves this by working with private sector partners, such as Omantel, PwC and Muscat Daily to develop candidates through conferences and events and internships. Since its inception in Oman AIESEC has (as of 2012) engaged with more than 500 members and organised over 100 international exchanges, and it operates a network that includes Sultan Qaboos University, Modern College of Business and Science, College of Banking and Financial Studies, Majan University College, Waljat College, Middle East College of Information Technology, Higher College of Technology, Gulf College and Sohar University.

Project Support

Since 1998 young Omani entrepreneurs have also had recourse to the Fund for Development of Youth Projects, or Sharakah. Established by Royal Decree with the aim of supporting start-ups and small and medium-sized enterprises (SMEs), between 1999 and 2004 it utilised its OR5.37m ($14m) capital to support 23 projects by making equity investments in them. In 2004 the organisation’s mission was reevaluated, and it recommenced operations in 2007 with renewed vigour. Since then it has supported 28 projects, with an average investment in each of them of OR52,000 ($135,515) (as of March 2012). The companies which have benefitted from the re-launched Sharakah fund have generally succeeded in establishing themselves in their respective markets. “In the SME segment it is accepted worldwide, I think, that if you have a 30% success rate out of the portfolio you are doing great. With only one failure officially I would consider us as having a successful portfolio – over 90% of the businesses we have started are sustaining themselves in the market. As of June we have created over 100 jobs as a result of these businesses,” Abdullah Al Jufaili, the general manager of Sharakah, told OBG.

The nature of the sultanate’s demographic profile means that job provision will likely remain a challenge for the government in the foreseeable future, and investment in capacity building will be a staple of the annual budget for years to come. But Oman has already made considerable progress in providing its young population with the skills and opportunities that are needed to thrive in the private sector, as the work of organisations such as AISEC and Sharakah demonstrates.