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Knowledgebase : English > General Questions about Labour Market Reform Project
     
The use of policies to rigorously manage the use of foreign labour is widespread in both the developing and developed world. Singapore, Indonesia, Malyasia, Hong Kong, Japan, most of Europe, and North America, to name a few, have some sort of fee and/o...
The proposed labour policy will have implications on small companies' cost structures. In Bahrain, SME's rely heavily on cheap expat labour. In fact, the overall Bahrainisation level for companies with less than 10 employees is less than 2%. The imp...
Operating costs of the construction industry will increase by 14% as a result of the proposed labour reforms, much of which can be recovered through improving productivity and passing on some of the higher costs to consumers through price increases. A...
Equalizing costs between expats and Bahrainis through the use of labour fees and other policy levers will allow Bahrainis to compete with expats on a level-playing field. As long as Bahrainis are able to demonstrate the required work ethic, good attitu...
Bahrain is undergoing an integrated reform program that will cover labour, economic policy and education and training. Each segment's vision and policies will be evaluated and then a structured implementation plan will be defined and executed. Althoug...
Companies relying heavily on low cost expat labour will be the most affected by the proposed reform policy. Currently, this segment only accounts for 10% of foreign direct investment flows into Bahrain and is composed of companies mostly from the texti...
The data underlying the recommendations are a result of an extensive process of review and corrections. The data have been scrutinized by the relevant ministries and government officials, who have agreed that these are the best available numbers for th...
Potential for leakage is substantial The overall principle of the reform is to apply the policies as consistently and uniformly as possible to limit the opportunities for abuse of the system. That is why the proposed policies will apply equally acros...
The benefits of applying labour fees differentially across industry sectors or expat skill-levels are far outweighed by the costs of administering and enforcing such a segmented system. The current Bahrainisation regime, for instance, has differential ...
The impact assessment describes the cost impact on different industry segments on average. Individual companies may be impacted more or less severely depending on three factors: * Labour intensity of the business (i.e. the portion of total costs co...
A minimum wage would be very costly for Bahrain, and would be ineffective in reducing unemployment among low-skill Bahrainis. * If Bahrain were to enforce a standard minimum wage across both Bahrainis and expats, 80% of the proceeds of the wage in...
The money raised through the proposed labour fees will be collected into a labour fund to be used for specific purposes, including supporting Bahrainis in securing private sector employment and investing in the private sector to assist in the adjusting...
A great deal of time is being invested in identifying how government processes need to be changed and improved to ensure that implementation will occur. The proposed implementation approach puts aside all of 2005 to prepare the government to administer...
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