Skills shortage a concern for Saudi’s big-ticket events

• Giga-projects need expertise
• Urgent skills gap grows
• Events face staff shortage

Saudi Arabia’s tourism and hospitality sector is suffering a skills shortage which it urgently needs to address before hosting some of the world’s biggest events, the CEO of one of the kingdom’s giga-project companies said.

Of these events, perhaps the biggest is the 2034 World Cup. But before that lies a host of others as the world’s largest oil exporter seeks to diversify its economy and create more jobs. That includes the 2029 Asian Winter Games and Riyadh Expo 2030.

“The kingdom has a tremendous need in industries that we never mastered,” Jerry Inzerillo, CEO of Diriyah Gate Development Co., said during a panel discussion this week hosted by the Washington-based Atlantic Council.

“Where we didn’t have the expertise up until a few years ago – [in] design, marketing, entertainment, tourism – we have to train.” 

In partnership with the sovereign Public Investment Fund, Inzerillo is overseeing the $64 billion Diryiah giga-project, a mixed-use development west of the capital, Riyadh, that draws on traditional Najdi architecture typical of eastern Saudi Arabia. 

Diriyah is one of five, multi-billion dollar, state-supported, so-called giga-projects, requiring in total as much as $1 trillion of investment. They are central to Crown Prince Mohammed bin Salman’s Vision 2030 strategy of transforming the Saudi economy and society.

Despite “spectacular talent” in the Gulf’s most populous state, a shortage of skills is the single biggest issue that “keeps me up at night,” Inzerillo said during the virtual event. His company employs 3,200 people, more than 80 percent of whom are Saudi nationals.

Delayed one year because of the Covid pandemic, Expo 2020 Dubai attracted more than 24 million in-person visits over its six-month period from 2021. More than 3.4 million attended the 2022 FIFA World Cup in Qatar.

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The Saudi government has increasingly been requiring companies to hire more local nationals, set quotas in this respect, and penalise non-compliance. 

As a result, Saudi unemployment, especially among women, has fallen from almost 12 percent in 2015 to 7 percent last year.

Half Saudi Arabia’s population of 21 million local citizens is under the age of 30.

However, Saudisation — as the quota policy is known — has pushed staffing costs up as companies compete to hire a limited number of trained Saudi professionals.

“Projects competing with one another can create an inflationary environment,” President at engineering company Bechtel, Justin Siberell, said at the same event.