RIYADH (Reuters) – Foreign banks are flocking to Saudi Arabia as the emirate opens up its bourse and rolls out the world’s biggest stimulus package but they face challenges recruiting, training and ultimately retaining local staff.
Speakers at the Reuters Middle East Investment Summit this week said the Gulf Arab state offers plenty of opportunities for banks and fund managers after the government launched a spending plan of $400 billion and opens up its financial sector.
But finding and developing talent is a challenge, especially in management positions or jobs that need specialist or technical skills such as Islamic banking.
“If you look at the rate the financial services have grown there are probably enough people to cover the ten (Saudi) banks historically… the pool of talent beyond that isn’t there,” said Paul Gamble, head of research at Jadwa Investment. “It reflects the growth of the financial services sector.”
Many Saudis work in retail banking but not so many are investment bankers or senior managers, said John Sfakianakis, chief economist at Banque Saudi Fransi.
“There are job entrants but there is a shortage of senior managers,” he said.
Adding to the woes, the government has set quotas for the number of nationals private firms must hire but the state education system fails to meet job market demands.
Many firms develop trainee programs to lure local candidates and offer them individual career plans and coaching. But retention is an issue as banks compete for a small pool of young talented Saudis who have returned from scholarships abroad.
“We hired staff and taught them but after one year they would move to other companies,” said Hesham Abu-Jamee, chief investment officer at Bakheet Investment Group.
The Saudi unit of Dubai-based investment firm Shuaa Capital has increased staff by 20 percent to 50.
“Good talent comes at a price,” said Omar al-Jaroudi, Shuaa Saudi’s CEO.
“We have developed several retention programs for our staff starting from training to financial compensation to career planning… this will help people think twice before moving,” Jaroudi said.
One advantage is that in Saudi Arabia, one of the world’s most conservative countries and birthplace of Islam, many locals do not want to move abroad but stay with their families.
“They like to travel but don’t necessarily want to go through international careers,” said Sfakianakis.
Haroon Nisar, senior manager for Islamic banking at Riyadh’s Saudi Hollandi Bank 1040.SE, cited a more compelling tactic.
“They just warn that you give them a decent vision… which way their future is heading so they will probably stay for a long time with you.