Saudi Arabia Opens a Business Center to Employ Its Women

Even though nearly 57 percent of the country's college graduates are women, only about a fifth of them enter the workforce. A new project might change that. 

A Saudi saleswoman works at a jewellery shop in Jeddah. (Susan Baaghil/Reuters)

It’s hard for women in Saudi Arabia to find good work. For many businesses, cultural norms and strict gender segregation make hiring women seem like more trouble than its worth. Banks, factories and other companies have to create separate sections for their female employees, separate entrances, and in many cases they have to install women’s bathrooms. Even then, any workplace where women interact with men outside their family can become highly controversial. (Earlier this year, the kingdom’s religious officials issued a fatwah against women working as grocery cashiers.)

But companies like India’s IT and business services giant Tata Consultancy Services are starting to change that. Today, Sept. 25, Tata Consultancy announced the launch of its “all-female services center” in Riyadh. Companies like General Electric, which will have a minority stake in the venture, and Saudi Aramco, a state-run oil firm, will outsource back-office operations like human resource or finance management to the center.

“In India, there has been huge opportunity for our industry to liberate underused talent and, while Saudi isn’t on the same scale, there is still a big opportunity to help people, especially women, find good professional jobs,” Natarajan Chandrasekaran, chief executive of Tata Consultancy, told the Financial Times. The operation will employ 400 women next year, and should eventually staff 3,000 women.

Saudi women are indeed a pool of underused talent. They account for about 57 percent of university graduates, but only 20 percent of those women are likely to enter the workforce. As Saudi Arabia works to transform itself from an oil-dependent economy to one more reliant on services and a private sector comprised of Saudis and not expatriates, women could help fill jobs. King Abdullah realizes this; over the last few years he has gradually loosened restrictions that require women to get permission to work from their male guardians, such as their husbands or fathers. Today, more women are employed than ever before, according to government data—647,000 as of last year, compared to 505,000 in 2009.

But while more women have started working in real estate and law, they are not well represented in the country’s business community, and not nearly as well paid. They work as store clerks, in food preparation, or in medicine or academia, often for as little as half of the wages men earn. According to the Ministry of Labor, women in the private sector earned on average salary of 2,824 riyals (about $750) compared to 5,685 riyals for men in 2011.

Female-only operations like the Tata center are a first for the country, Chandrasekaran says. That the center hasn’t been severely criticized yet may be a sign of opening. He told the FT, “This has got the full support of the government, and lots of businesses too.”