Balancing Talent and Identity: The GCC’s Labor Market Test

The Gulf Cooperation Council (GCC) labour market is at a pivotal crossroads. The high ratio of expatriate workers, which accounts for almost 78% of the total workforce in this region as of Q2 2024, according to a recent statement from GCC Assistant Secretary General for Economic and Development Affairs, underscores its heavy reliance on foreign labour. While this dependence has greatly fuelled rapid economic growth, it now imposes significant challenges to the ambitious diversification agendas. Across the region, and in an attempt at reducing reliance on foreign labour, governments throughout the GCC are intensifying the adaptation and implementation of nationalization strategies to rebalance the labour market in favour of nationals.   This situation offers a mix of opportunities and risks—on one hand, the potential for more inclusive and sustainable growth, and on the other, the risk that reforms misaligned with market realities could undermine competitiveness. Hence, amid this tension, the challenge of nationalization becomes increasingly urgent.