On March 18, 2011, Saudi King ‘Abdulla announced the implementation of new socioeconomic reforms which mainly include: immediate payment of two months’ salary to all governmental employees as compensation for the rise in living costs; monthly payment of SR2,000 as an unemployment allowance; setting a minimum wage of SR3,000 for all governmental employees; and adding 60,000 positions in the Interior Ministry (de Kerros, 2011; IMF, 2011:11; MEED, 10-16 February 2012:33). However, raising public sector salaries and generous unemployment allowances, as noted by the IMF (2011:19) “[…] provide a disincentive for nationals to seek private sector employment.”
In general, the Saudi “rentier-reaction” to the risk of spreading the Shi‘i uprising which occurred in Bahrain to the Saudi Kingdom amounted to $129 billion (Gray, 2011:22). The Omani authorities also reacted with a massive increase in governmental expenditures, mainly by raising the minimum wage from $364 to $520 for the 150,000 public sector employees (MEED, 2011 Economic Review:12; MEES, 16 January 2012:20-21). The reaction of the other four GCC authorities to the “Arab Spring” was quite similar and concentrated mainly on: improving living standards, increasing public sector wages and reducing unemployment among youths through massive absorption into the public sectors. Thus, to a great extent, the “Arab Spring” altered the former policy of steadily narrowing the “rentier umbrella” to the indigenous population due to the fear of an uprising on socioeconomic grounds.
