The United Arab Emirates is intensifying its push to increase Emirati participation in the private sector, placing growing pressure on small and medium-sized enterprises (SMEs) to meet national employment targets. Under the Emiratisation policy, companies are required to hire a minimum percentage of UAE nationals, a move the government says is essential to building a sustainable, knowledge-based economy and reducing reliance on expatriate labor.
For many SMEs, however, compliance presents significant challenges. Smaller firms often operate with limited budgets and lean workforces, making it harder to absorb the higher costs associated with hiring and retaining local talent. Business owners point to salary expectations, training expenses, and the need to redesign roles to suit national employment requirements as key hurdles. Unlike large corporations, SMEs typically lack dedicated human resources departments or structured training programs to support Emirati employees over the long term.
The government has responded with incentives, including wage support schemes, training subsidies, and access to national talent platforms designed to connect employers with qualified Emirati job seekers. Authorities argue that these measures ease the transition and help SMEs benefit from a more stable, locally rooted workforce. Supporters of the policy also note that increased Emirati participation can strengthen corporate culture and improve alignment with local markets and regulations.
Despite these initiatives, some business groups warn that overly rigid enforcement could strain smaller companies, particularly in competitive sectors such as retail, hospitality, and professional services. They urge a more flexible, sector-specific approach that balances national workforce goals with economic realities.
As Emiratisation requirements expand, SMEs remain at the center of a delicate balancing act—adapting to national priorities while striving to remain competitive and financially sustainable in a rapidly evolving business environment.
