Monday, October 18, 2010

UAE to adhere to current sponsorship system

The current UAE sponsorship system will remain unaltered, as the country is spending about Dh.50bn per annum to host 4 million foreign workers, said the Minister of Labour, Saqr Gobash Saeed Gobash.

He added that he has not seen a country that did not have a sponsorship system for foreign workers. He revealed that the government is open to improving systems and changing policies to boost local economy.

He said that the Ministry of Labour has been improving the sponsorship system and will continue to do so, whenever it sees benefits from modifying the rules.

The average cost of hosting a worker is estimated to be about Dh.55,000. The cost of a skilled worker is Dh.144,000 while that of an unskilled worker is Dh.33,000, said Dr. Mouawiya Al Awad, Director of Institute for Social and Economic Research, Zayed University. The overall average annual administrative and recruitment costs per worker, are worth Dh.2,674. Total wages and cash and non-cash benefits are an average of Dh.41,000 per worker annually.

But, despite the costs, hiring of foreign workers is an economic advantage over private companies, and to the UAE economy, in comparison to the productivity levels of the workers, the study revealed. The study found that return on investment on foreign labourers is five times more than making the hiring of foreign workers a more attractive option.

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