Selected Issues Papers

Labor Market Dynamics in Oman: Oman

By Bilal Tabti, Haytem Troug

April 15, 2025

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Format: Chicago

Bilal Tabti, and Haytem Troug. "Labor Market Dynamics in Oman: Oman", Selected Issues Papers 2025, 034 (2025), accessed April 22, 2025, https://doi.org/10.5089/9798229008174.018

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Summary

The prevalent strong preference for public sector employment among young Omanis, coupled with demographic pressures and medium-term fiscal sustainability objectives amid economic diversification away from hydrocarbons, underscores the urgency to pivot towards a more dynamic private sector that attracts Omanis towards private sector jobs. This note delves into recent developments and structural idiosyncrasies in Oman's labor market, highlighting distinct segmentation and limited mobility, which disincentivized upskilling and impeded sectoral labor reallocation. The analysis reveals that comprehensive reforms are needed to narrow the public-private wage gap, boost private sector employment for nationals, and elevate overall productivity. These include aligning wages with productivity, improving vocational training, fostering female labor market participation, and enhancing labor market mobility for expatriate workers. Implementing these measures is pivotal for Oman to realize its Vision 2040 objectives, transitioning towards a knowledge-based economy, and achieving sustainable nonhydrocarbon growth.

Subject: Economic sectors, Employment, Gender, Labor, Labor force, Labor force participation, Labor markets, Public employment, Public sector, Public sector wages, Wages, Women

Keywords: Employment, Human capital, Job creation, Labor force, Labor force demographics, Labor force participation, Labor markets, Labor mobility, Labor mobility, On the job training, Public employment, Public sector, Public sector labor markets, Public sector wages, Wage gap, Wages, Women

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