The Middle East region faces the critical challenge of creating 80 million jobs by 2020, according to the findings of a new survey.
“At the heart of the problem is youth unemployment – a quarter of young people in the region lack jobs and twice as many women as men are looking for work across the region,” the survey conducted by PwC Middle East, revealed .
The Middle East is home to a wide pool of talented and young population. More than half of the region’s population is under 24 years of age. In this new period of optimism three quarters (77%) of Middle East CEOs expect to increase headcount over the next 12 months. That’s the highest figure of any region in the world (the same as last year) and far above the global average of 50%.
Nearly 95% of Middle East executives said that improving diversity and inclusion across the workforce, and at board level, was important for their business.
In its latest edition of the survey, PwC Middle East sought the opinion of 51 Middle East CEOs, 49% of which anticipate improvement in the global economy, a marked increase on the 22% who expressed the same optimism last year.
A surprising 96% of Middle East CEOs are entering 2014 either somewhat (30%) or very confident (66%) confident about their own prospects for growth in the next 12 month; a percentage that is significantly higher compared to the global level (39%).
The region’s resilience to local and global shocks and the growing adaptability of its economies to political turmoil played a major role in building the sense of optimism among Middle East leaders. This stems from the majority of CEOs now being well versed in dealing with periods of change and upheaval.
Concrete examples to attribute this sense of optimism are the accelerating pace at which mega projects and infrastructure development, most notably in the GCC, is becoming more apparent. However, there still does remain a marked difference between the optimism voiced by business leaders in the GCC and those in the Levant.
“The Middle East economy today stands ready to ride a fresh wave of CEO optimism about economic growth,” commenting on the survey findings, Hani Ashkar, PwC Middle East Senior Partner, said.
“Securing success in the short term will involve smart handling of well-known existing issues such as retaining talent, growing while maintaining a lean operation and handling an evolving economic, political and social landscape. But the real challenges lie ahead as CEOs prepare their companies for a technology-driven future that creates new types of markets, workforce and consumers,” he added.
While 35% of global CEOs believe innovation in new products and services is the main driver of business growth for their companies over the coming 12 months, regional CEOs said that the main driver for their growth stem from the increasing share of business in existing markets, followed by innovation in new products and services (30%); a big jump from 2013, were only 9% were prepared to put faith in developing new products and services.
There was more unanimous agreement on potential economic and policy threats to the growth of the region, where around two-thirds of Middle Eastern CEOs pinpointed three main factors: lack of stability in capital markets (72%), government response to fiscal deficits and debt burden (70%), and a slowdown in high-growth markets (66%). As for business threats, roughly two-thirds of CEOs identified availability of key skills (70%), bribery and corruption (70%), and cyber threats (68%) as the key threats.
Regional CEOs surveyed acknowledged that to achieve success they would need to evolve their business strategies to meet the needs of a rapidly changing society. These CEOs identified mega trends that they believe will have an impact on their organisation in the next five years; over 80% found that technological advances such as the online economy, social media, mobile devices and big data would have a major impact. 68% identified a shift in global economic power, 57% highlighted demographic shifts while 51% also pointed to the effect resource scarcity and climate change will have on the region and the world.
“For the future, CEOs tell us that they expect four major global trends – rapid technological advances, shifts in economic power, demographic changes and resource scarcity and climate change – will have a major impact on the future of their businesses. Finding ways of turning these global trends to their advantage will be the key to future success,” Hani, added.