Over the past few decades, the government of Bahrain has encouraged the private sector to provide employment for Bahrainis and increase their wages. Several initiatives have supported the private sector, particularly the Bahrainisation policy, which stipulates that all private organisations must have a percentage of Bahrainis in their workforce.

Levy system

The government introduced a training levy system in 1979 to promote vocational training of Bahraini workers in the private sector, by making the private sector contribute to the training of Bahraini employees. Private sector employers are currently required to pay a levy of 4% of the salaries of all expatriate employees. Of this levy amount, 75% can be reclaimed on conducting training for Bahrainis.

Bahrainisation policies

The first five-year Bahrainisation plan was introduced in 1989, and aimed to ‘Bahrainise’ jobs in a measured, gradual way so that the process would not adversely affect the competitiveness of the national economy. The focus was on the creation of new jobs in different economic sectors. Similar plans followed.

The Labour Fund is a semi-autonomous yet independent authority which formulates strategic and operational plans to enhance the overall prosperity of Bahrain by investing in Bahraini employability, job creation, and social support. Its main objectives are to support Bahrainis to become the employees of choice, support high quality private sector job creation and help the private sector cope with the impact of labour market reform.

To achieve these objectives, the Labour Fund:

			Invests in the cost and quality competitiveness of Bahrainis (e.g. by reducing the cost of employing Bahrainis relative to expatriates, and investing in the skills and work ethics of Bahrainis).
			Tackles employment barriers for employers and new market entrants through a combination of financial incentives and capability building.
			Supports the private sector's adjustment to new cost structures by providing access to capital to alleviate short-term cash constraints or improve productivity.
			Backs know-how initiatives that support improvements in productivity and decrease reliance on expatriate labour by spreading management and technical knowledge.

The Career Progression Project is a major initiative by the Labour Fund specifically developed to address underemployment or skills deficiencies that hinder career progression opportunities for Bahraini workers in the private sector.