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Labour force and employment regulations

In 2003 the labor force in Kuwait was 1.4 million. More than 81% of the labor force were non-nationals numbering 1.14 million. Overall, the labor force grew by 7.3% over the last 12 months. Both the Kuwaiti and expatriate segments experienced lower growth compared to the previous year, increasing by 4.5% and 8%, respectively, though the slowdown was especially noticeable among nationals.

Among Kuwaitis, the net increase in employment during the year ending exceeded 11 thousand, 90% of which was absorbed by the public sector. The number of new jobs, which decresed by 27%, remained below the number of Kuwaiti entrants into the labor market. As a result, the number of unemployed Kuwaitis is increasing.

In 2003 the Kuwaitis registered to receive unemployed compensation reached 9.9 thousand, up by 38% from a year ago. This represents an employment rate among Kuwaitis of 3.6%. While this figure appears relatively low, it may non-the-less reflect high unemployment since the figure excludes that have been seeking unemployment for under six months. Though fresh university graduates and other new entrants into labor market represent a large part of those seeking work they are not eligible to obtain unemployment compensation within the first six months.

At the same time, the figure may overestimate actual unemployment by counting registrants who have no intention of working. Indeed, during the first half of 2003, over 17 thousand Kuwaitis submitted applications for employment with the Civil Service Commission, a number that far exceeds the number expected to have entered the labor market. Of the applicants, roughly 90% were women, which may indicate that many applicants outside the labor market have applied for jobs with the sole intention of collecting unemployment compensation.

The employment of Kuwaiti nationals in the private sector accelerated over the past three years, no doubt driven at least in part by incentives provided by law 19/2000. The law introduces a number of incentives to Kuwaitis working in the private sector. The quotas were specified in decision number 904/202. The net increase in the number of Kuwaitis employed in the private sector during the 12 months ending June 2003 reached 1,150 jobs versus 980 jobs the previous year.

The net increase in expatriate employment during the same period was very similar to the figure seen the previous year. Net new jobs totaled 84.2 thousand, with the increase during the first half of 2003 exceeding that seen during the second half of 2002 by 31%.

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