Generations A: Differences and similarities across the Arab generations

A critical element missing in the discussion of changes in Arab countries is a generational perspective. This survey and study allows policymakers and business leaders to take advantage of this valuable generational approach to framing social, economic, and employment policy.

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Generations A Differences and similarities across the Arab generations

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Contacts

About the authors

Abu Dhabi Richard Shediac Senior Partner +971-2-699-2400 richard.shediac @strategyand.pwc.com Dubai Jayant Bhargava Partner +971-4-390-0260 jayant.bhargava @strategyand.pwc.com

Richard Shediac is a senior partner with Strategy& and the leader of the firm’s public sector practice in the Middle East. He primarily focuses on the development of sustainable publicsector strategies, restructuring initiatives, operations improvement, and organization development. He is also a member of the Strategy& board of directors. Ramez T. Shehadi was formerly a partner with Booz & Company. Jayant Bhargava is a partner with Strategy& in Dubai. He leads the firm’s digital media and entertainment work in the Middle East, focusing on the convergence between media, telecoms, and technology. He serves both traditional media and digital media players on strategy, M&A, and operating model topics. He also actively supports sector development institutions in carving out media-sector strategies, policies, institutional frameworks, and privatesector participation models. Dr. Hatem Samman was formerly the director of the Ideation Center, Booz & Company’s think tank in the Middle East.

This report was originally published by Booz & Company in 2013.

Dr. Mounira Jamjoom and Tatiana Shahir also contributed to this report.

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Executive summary

The Arab region has undergone significant changes in recent decades. These events do not affect all age groups uniformly — instead, each new generation is shaped by the socioeconomic events that it experiences most directly. As a result, the different Arab generations are increasingly distinct, each with their own perceptions, needs, and priorities. As governments and business leaders seek to craft economic reforms and make their countries more competitive, they need to tailor policies that effectively meet the varying objectives of the different Arab generations. This starts by understanding the generations themselves — their similarities and differences, and how they view the world. To this end, we surveyed nearly 3,000 Arabs in six countries to gauge their views on a number of critical topics. We divided the survey population into three groups: the Arab National Generation (ANG), defined as those ages 49 to 65; the Arab Regional Generation (ARG), those ages 36 to 48; and the Arab Digital Generation (ADG), those ages 15 to 35, who have been most affected by the globalization and digitization trends of the past decade. On certain topics, the views of these three groups are closely aligned, such as their cultural values. In other ways, such as working styles and their use of technology, the three generations are quite distinct. For governments, the policy imperatives are clear: Education reform is critical, followed by labor-force planning, improvements to the delivery of government services, and a better use of technology (such as e-government offerings and integration of smart devices into daily interactions). The private sector must also understand generational differences — particularly the different working styles and skills of younger and older employees — and seek to capitalize on their complementary skills and attributes, and should aim to exploit widespread social networking adoption to make changes to advertising and to stimulate e-commerce.

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Age matters: Different generations, different perspectives
The Middle East is at an inflection point in its history, as the enthusiasm of the Arab Spring evolves into very real questions about the region’s future. The Economist Intelligence Unit in 2011 published an insightful yet grim outlook for the region. The study forecasted a 60 percent probability of a gridlocked political environment, which is likely to stifle the aspirations of the region’s citizens.1 To overcome this challenge, many countries across the region are pressing ahead with political, structural, and human capital reforms to achieve inclusive growth and create permanent jobs for the Middle East’s growing youth population. Policymakers, business leaders, scholars, and interested citizens have sought to improve the effectiveness of these efforts by better understanding various demographic groups. Youth and women have certainly had the lion’s share in demographic and trend analysis thus far, primarily because they face the most immediate and obvious challenges. For example, the youth unemployment rate in the region is about 25 percent, among the highest in the world. The situation is even more dire for young women, who face an unemployment rate of about 40 percent. Although youth- and women-focused labor market policies are crucial, they will not be enough to address long-term challenges and focusing exclusively on these two groups is short-sighted. Adult employment remains a significant issue as well. The duration of unemployment is shorter for youth than for adults. Indeed, the ratio of youth to adult unemployment is decreasing in part because the ratio of young to old is falling in the region’s population, all of which underscores the need to approach the issue holistically (see Exhibit 1, page 5). More broadly, the Arab Spring offers a good opportunity to think about new development models that can promote sustainable economic growth, global competitiveness, and development. In previous reports, we have has analyzed key groups within the region, as defined by economic and sociological factors, including the middle class, youth, and the Arab Digital Generation.2 In this report, we focus specifically on age, to better understand the key generations within the Arab region. More specifically, we argue that the generations have very different
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The youth unemployment rate in the region is about 25 percent, among the highest in the world.

perceptions thanks to the historical events that have shaped them. As a result, members of a generation tend to share common beliefs and behaviors, including basic attitudes about work, risk-taking, civic engagement, cultural values, and family life.

Exhibit 1 The youth population is set to fall
Ratio of Youth to Adult Population (%, Projected to 2050)

70 60 50 40 30 20 10 0 1970 75 80 85 90 95 2000 05 10 15 20 25 30 35 40 45 2050
Note: North Africa projection only runs to 2015. Source: Z. Tzannatos, “Rethinking Economic Growth in the Arab Region” (presented at the “From the University Campus to the Labour Market” session), Microsoft Regional Summit and Expert Group Meeting on Youth for Global Competitiveness, Dubai, May 18, 2013

World (not including Middle East & North Africa) Middle East (not including GCC) GCC North Africa

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This study also coincides with a time when the region’s workforce is made up of a minimum of three generations. Our intent is to identify the bridges across generations and define new ones where they are missing. Although the region is witnessing a rise in the use of the term “generation divide” in public discourse, there is little research that clearly demarcates generations or explains generational trends. Beyond the media hype, there is a marked gap in the literature on generations. A generational perspective is therefore the missing variable. Regional governments and business leaders have not yet taken these generational differences into consideration when crafting social and economic policies. If they are to meet the needs of a broad range of groups, policymakers must understand the diverse perceptions and priorities of the region’s generations. As Arab region leaders formulate social and economic reforms to promote sustainable and inclusive growth, and make the region more competitive within the global economy, they must develop policies that accommodate and leverage the unique characteristics of different demographic groups. Before they can begin to tailor their policies in this fashion, they must understand the differences between the Arab region’s generations. There are a number of reasons why age demographics are a compelling issue for development: Changing Demographics: Regardless of the level of economic development or national income, Arab region governments are increasingly challenged to provide the basic needs and improve standards of living for a growing numbers of citizens: adequate housing, sanitation, healthcare, education, and jobs. The region’s economic dependency — the ratio of economically inactive to economically active populations — is among the highest in the world, and that problem will likely worsen. Irrespective of the actual percentage, the sheer volume of economically inactive citizens will create a strain that regional governments will need to be equipped to handle. For example, the elderly population of Egypt (60 years and older) is expected to grow from 6 percent of the population at the start of this century to 21 percent in 2050, and Saudi Arabia’s elderly population is expected to grow from 5 percent to 13 percent of the population during the same period.3 Sociopolitical Imperative: The cultural values that have defined the Arab region are slowly changing; they have been complemented by a gradual rise in “individualism,” mostly led by the younger generation promoting the right to pursue one’s goals, to be more self-expressive, and to value independence and self-reliance. The decline in communal values is also a reflection that in many countries the younger generations are facing hardships, with high unemployment rates among youth.
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A Multigenerational Workforce: The region’s future private-sector workforce will likely have a multigenerational feel. A generational lens allows employers to prepare for an increasingly age-diverse workforce, by identifying promising practices in recruiting, hiring, retaining, and accommodating a multigenerational workforce. Such a prospect also allows governments to promote future jobs and industries that attract younger generations. This is not only a challenge for the Arab region. In many parts of the developed world, policymakers and academics devote significant time and attention to understanding different generations and how they perceive the world and their place in it. In part, this is because their economic challenges are rooted in demographics. For example, Japan is currently struggling with an aging population, which threatens the country’s economic expansion because of the shrinking working population. In the U.S., many companies are taking active steps to recruit and retain the so-called millennials (i.e., younger people just leaving university and entering the workforce),4 who have grown up with technology and have significantly different working styles and preferences than older generations. In the U.K., a recent study analyzed 17 years of polling data, crossing four generations, which showed striking gaps among the groups regarding government priorities, the correct degree of social spending, and other aspects of society and social policy.5 Our research defines generations based on key socioeconomic trends that either shaped the times when a particular age cohort was born or occurred at various points in their lives. Thus, a generational cohort shares “an age location in history” whether or not they were influenced by these particular events. To understand the generational differences within the Arab region, we have taken the 15-year-old to 65-year-old working-age population and divided it into three age cohorts: • Arab National Generation (ANG) — This demographic cohort was born between 1948 and 1964 (ages 49 to 65). The key socioeconomic event that shaped this era was the rise of Pan Arabism, which was built on the idea of a united Arab nation bound together by common linguistic, cultural, and historical heritage. It was also a time when governments emerged as key economic agents. • Arab Regional Generation (ARG) — Born between 1965 and 1977 (ages 36 to 48), this group grew up during the expansion of oil wealth in some countries, especially in the 1970s and 1980s, leading to the distribution of wealth across the Arab region and the rise of regional economic blocs such as the Gulf Cooperation Council (GCC),6 which was established in 1981.

Regional governments and business leaders have not yet taken these generational differences into consideration when crafting social and economic policies.

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• The Arab Digital Generation (ADG) — Born from 1978 onward (though our research includes only those ages 15 to 35), this age cohort experienced the onset of digital technology, along with economic globalization. To understand the differences and commonalities among these generations, we commissioned focus groups and an online survey of nearly 3,000 participants in six Arab region countries: Egypt, Jordan, Kuwait, Qatar, Saudi Arabia, and the United Arab Emirates (UAE). (For more details about the study, see “Survey Methodology,” page 9). Additionally, supplementary data from 649 respondents was collected in five other countries: Algeria (170), Lebanon (148), Libya (73), Morocco (163), and Syria (95). In some areas — such as values, political views, and citizenship — the survey responses from different generations are aligned on several topics. However, in others — such as technology and work — the differences are stark. We grouped the results into four broad categories, which are each discussed in subsequent sections: values and generational characteristics; national outlook, civic engagement, and citizenship; the world of work; and technology, media, and consumerism.

Exhibit 2 Six dimensions were used to study the Arab generations
Dimensions Framework - Personality and value characteristics, education, income, employment - Family relations, satisfaction with life achievements - Local, regional, and world outlook - Entitlements and their effectiveness - Satisfaction in the workplace - Gender and the workplace - Conservatism and traditionalism among generations - Concerns about the erosion of core values - Technology use and frequency, Internet access, online purchases, and obstacles - Socioeconomic challenges and challenges to development Countries Regions Gender Age Demographic characteristics

Profile Politics Employment Core values Technology & commerce Development challenges

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Survey methodology
We commissioned YouGov, a research and polling firm, to conduct the Arab Generational Divide survey, which consisted of both quantitative and qualitative components. During the qualitative component, YouGov conducted eight mini-focus groups and three paired in-depth interviews in Egypt and Saudi Arabia. The mini-focus groups consisted of four respondents, and the paired, in-depth interviews consisted of two friend respondents. This phase provided fundamental information regarding attitudes, behavior, and perceptions, which helped shape the quantitative questionnaire (see Exhibit 2, page 8). For the main quantitative phase of the research, YouGov conducted both online and face-to-face interviews, generating 2,786 responses from participants in six Arab countries: Egypt (784), Jordan (450), Kuwait (256), Qatar (262), Saudi Arabia (703), and the United Arab Emirates (331). Supplementary data from 649 respondents was collected in five additional countries: Algeria (170), Lebanon (148), Libya (73), Morocco (163), and Syria (95). This supplementary data was not included in the analysis of the six main countries due to the insignificant number of respondents in each country. However, we highlight the findings from the supplementary data when relevant. Face-to-face interviews were used in countries where it was difficult to reach a sufficient number of respondents online — primarily the UAE, Qatar, and Kuwait. In each country, YouGov ensured that only nationals answered the survey, and that all three generations — ANG, ARG, and ADG — were equally represented in the results. The weighted sample split by gender ensures equal representation of genders: 1,393 women and 1,393 men. This study uses generations as the main variable for analysis. We cited the differences among countries where relevant. Throughout this report, “net scores” show results in a single figure, enabling us to quickly summarize results and compare them across generations.

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Values and generational characteristics
In general, the results show that all three Arab generations are more united than divided in their core values. For example, all three groups identify “hospitality,” “generosity,” and “dignity” as core values that they associate with the Arab population as a whole and for their own generation (see Exhibit 3, page 11). This is a notable finding, in that values are an important form of social cohesion. Yet while “generosity” and “hospitality” are shared values across all three generations, they seem to be declining over time — possibly a reflection that in many countries the ADG is facing hardships with high unemployment among youth, a high cost of living, and reduced economic opportunities. In a more competitive economic environment and times of political unrest, it is possible that these people have more pressing concerns than being generous or hospitable. Indeed, when asked about their level of satisfaction with life achievements thus far, including career and education, the least satisfied were members of the ADG, particularly in Egypt, Jordan, and Saudi Arabia. By contrast, satisfaction levels were highest among the ANG, especially in the GCC (see Exhibit 4, page 12). This is in line with earlier research, showing that young people in the region are more concerned with socioeconomic factors than valuesbased issues. Unemployment levels for young Arabs are high — above 25 percent in many countries. Many young people do not believe in the quality of their education, and housing is disproportionately expensive compared to other regions, effectively restricting them to living with their parents until they are older.7 Indeed, demographic data from this survey shows that nearly two-thirds of ADG respondents across all countries — 62 percent for GCC respondents, and 58 percent for nonGCC respondents — live with their parents in large households.

Many young people do not believe in the quality of their education.

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Exhibit 3 The ANG upholds common values of dignity, generosity, and hospitality more than other generations
Top 10 Values Associated with Each Generation

GCC 32% 29% 29% ADG 36% 16% 21% 20% 21% 20%

Non-GCC

22%

29%

23% 23% 20% 23%

15%

10%

21% 20% 19%

35% ARG

29% 31% 30% 27% 25% 23%

39% 16% 17% 18% 25% 23%

31% 17%

25%

20% 22% 14% 18%

41% ANG

36% 40% 25%

40% 29% 24% 22% 19% 18%

41%

32%

26%

34%

25%

33%

26%

19% 17% 17%

Dignity Generosity Hospitality Affection Honesty Commitment Achievement Creativity Adventure Religiousness

Survey Question: Up to five words you would strongly associate w ith your generation of Arabs. Source: Strategy& Arab Generational Divide Survey

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Exhibit 4 Satisfaction with life achievements is least in Egypt, Jordan, and Saudi Arabia
Satisfaction with Life Achievements

Egypt

Jordan

Kuwait

Qatar

Saudi Arabia

UAE

14%

9%

7%

8%

6%

6%

4%

2%

1%

5%

4%

1%

1%

1%

4%

Very dissatisfied

1% 4% 10% 20% 65%

22%

21%

17%

20%

11%

13%

10%

10%

11%

9%

16%

4%

0%

4%

0%

6%

27%

23%

21%

22%

17%

17%

13%

13%

13%

14%

14%

13%

16%

Neutral

5%

6%

8%

50%

51%

49%

41%

39%

45%

37%

39%

40%

35%

33%

33%

40%

45%

Somewhat satisfied

25%

24%

45%

46%

45%

31%

40%

18%

13%

16%

19%

20%

ADG ARG ANG

15%

Very satisfied

33%

27%

25%

Survey Question: In general how satisfied are you with what you have achieved in life (career/work/ education)? Source: Strategy& Arab Generational Divide Survey

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32%

58%

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72%

26%

2%

0%

Somewhat dissatisfied

0%

0%

Given that different economic conditions prevail in the various countries covered in this study, we tried to assess how these generations perceived their households’ financial situation. Overall, a significant majority in UAE and Kuwait appear to live a comfortable lifestyle. However, one in three respondents in Saudi Arabia, mostly driven by the younger generation, says that they “manage on their present income.” In Egypt and Jordan, a majority does not appear to be comfortable with its household’s financial situation, and about 50 percent in both countries claim they are just getting by on their present income. In the supplementary country responses, the findings were similar to the situation in Egypt, Jordan, and Saudi Arabia. At least 30 percent of the ADG in these countries were finding it difficult to make ends meet, and 42 percent claimed to be just getting by on present income (see Exhibit 5, page 14). It is notable that in Qatar, a country with the highest per capita income in the world, about 32 percent of respondents claim to be getting by on present income. One explanation of these findings could be that expenses tend to catch up with, or exceed, income. When asked about values that they do not associate with their generation, all three groups cited “individuality” (mentioned by nearly a third of all respondents). This could be because of the region’s predominant emphasis on family and community and the negative connotation sometimes associated with individuality. For example, a recent United Nations Development Programme survey of Kuwaiti youth found that parents are the most important source of support for youth, where 46 percent referred to the mother as a primary source of support, followed by 42 percent who identified the father.8 Although the family remains the main identity reference for youth, our findings suggest that the ADG differ from other generations with regard to “individuality.” A smaller percentage said that the value was not associated with their generation — indeed, it seems that Arab youth are redefining individuality through engaging in new forms of self-expression and civic engagement. The slow rise of individuality also reflects changes in areas such as education. Increasingly, reforms are emphasizing concepts like individualized education and child-centered learning — a marked difference over the highly standardized form of education that older residents received. These are new concepts that are affecting the ADG directly.

In Egypt and Jordan, a majority does not appear to be comfortable with its household’s financial situation.

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Regarding differences, the ADG associates itself more with “adventure” and “extravagance” than the older two generations — as youth typically do in other parts of the world. The ANG associates itself with “achievement,” possibly indicating that these people were more driven and ambitious in what they wanted to do, and have reached a point in life where they can look back on their accomplishments. These findings were similar in both the main study and the supplementary countries.

Exhibit 5 Many are struggling with their economic circumstances

6% 13% 36%

10%

2% 2%

8% 32% 19%

4% 12%

2% 17%

5%

100%

67% 40% 36% 9% Saudi Arabia 19% UAE 20% Qatar

52% 56% 32% 2% Egypt

49%

21% Kuwait

24% 5% Jordan

Find it very difficult on present income Find it difficult on present income Getting by on present income Live comfortably on current income Live an affluent lifestyle

Survey Question: How would you describe your household’s financial situation? Source: Strategy& Arab Generational Divide Survey

Key priorities for policymakers and the private sector
Policymakers and business leaders should shift their perceptions of young people and view them less as a problem and more as an asset. The changing demographics and social status of youth can, and should, be seen as an opportunity to engage their vast untapped potential. As is evident by recent events, young people can be powerful catalysts for development in the region. Capitalizing on this energy will require a greater emphasis on policy that highlights partnerships and collective action. There are several measures in this area that can bridge the gap between generations — and build on common ties among them. First, Arab governments could consider developing national youth strategies that are built on a participatory and cooperative approach, involving the national government, the private sector, voluntary organizations, and international agencies.

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Second, they should develop a young leaders program (similar to those in Qatar and Jordan), to identify and develop exceptional young people. Once those programs are functional, governments should integrate the young leaders into policymaking, through new processes that give them a greater voice, particularly in socioeconomic affairs. Creating more effective communication channels and processes will help policymakers understand the desires and priorities of the large and growing youth population. In some cases, this may require upgrading the processes at key ministries to ensure they communicate with young people using the means most conducive to eliciting responses: digital technology. Third, if they are to identify and address generational differences and areas of alignment, policymakers must start with a foundation of information. To that end, governments must collect, analyze, and present accurate demographic data and statistics, particularly those that show the interplay among generations. Tracking demographic change has important implications on several fronts for governments, such as fostering a more detailed understanding of labor markets, tax reforms, and immigration policy, among others. By the same token, understanding the differences among generations will unlock certain benefits for the private sector. For example, understanding Baby Boomers, Generation X, and Generation Y in the U.S. holds the key to smart 21st-century customer service leadership. Understanding and working with different age groups makes it possible to create a balanced, open,

working environment, reduce costs, and create an engaged and motivated team that will ultimately offer the best possible service to your customers. This is what is taking place in countries like the U.S.9 Fourth, given that older generations hold much of the economic and political power in the region, governments should change the views of these generations regarding the ADG — especially any misperceptions regarding their values. The GCC countries in particular are still largely influenced by traditional, conservative values. Although those values remain critical, they can overshadow the economic concerns that are pressing for younger people in the region. To a population whose members are struggling to find work, traditional values may begin to seem less relevant in addressing their financial requirements and helping them fulfill their true potential. If the region is to grow economically, older people must actively bring younger people into the fold, rather than criticizing their choices. For this to happen, older Arabs must develop a better understanding of the ADG and seek to capitalize on their strengths. One option for governments to influence the views of older Arabs is through a public-awareness campaign that emphasizes the priorities and potential contributions of younger Arabs. Other options include policies that can foster cross-generation communication — for example, young people volunteering in charities to help the oldest generation — which can help bridge the gap and help older people understand the economic imperatives that young people face.

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National outlook, civic engagement, and citizenship
Regarding perceptions of their country and its place in the world, the results again indicate greater commonalities than differences. A positive sign is that Arabs are likely to believe their country is a leader in the Arab region in general terms. Considering more specific aspects, however, they are less likely to believe that their country leads in terms of technology or education (see Exhibit 6). This trend is more

Exhibit 6 Angs and ADGS are divided on whether their countries are regional leaders
46% 49%

Leader in the Arab World 6% 5% 3% 7% 6% 20% 4% 16% Neutral 23% 19% Neutral 24% 10% 8% 5% Neutral 21% 12%

27%

26%

30%

38%

Strongly disagree Technologically Advanced 9% 9% 4%

Somewhat disagree

Somewhat agree 26% 32% 39%

Strongly agree 24% 26% 32%

15%

11%

7%

16%

Strongly disagree Educated and Intellectual 5% 6% 2%

Somewhat disagree

Somewhat agree 36% 19% Somewhat agree 37% 38%

Strongly agree 23% 26% 34%

Strongly disagree ADG ARG ANG

Somewhat disagree

Strongly agree

Note: Percentages do not sum to 100 due to the removal of the minimal figures for those who did not know or could not say. Survey Question: To what extent do you agree with the following statements in relation to your country? Source: Strategy& Arab Generational Divide Survey

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pronounced for younger respondents — members of the ADG were less likely to agree than ARG or ANG respondents that their country has a leadership position, perhaps reflecting their current diminished economic prospects. Among the issues facing their respective countries, respondents of all three generations identified the lack of transparency and unemployment as the central challenges, followed by insufficient healthcare, inadequate infrastructure, and poor quality of education. Although these results were consistent across the region, they were far more predominant in non-GCC countries, and the responses were more balanced across all issues (see Exhibit 7). For the supplementary countries, a lack of transparency, poverty, and the widening gap

Exhibit 7 All generations across the region worry about the lack of transparency and unemployment

Arab Generations’ Top Governance Concerns

GCC 84% 83% ADG 44% 42% 38% 37% 35% 35% 29% 20% 91% 84% ARG 49% 46% 40% 39% 36% 34% 28% 19%

Non-GCC 69% 67% 67% 59% 53% 46%

73% 70% 71% 63% 56% 51%

ANG

46% 43%

35% 35% 32% 36% 25% 19%

90% 81% 77% 77% 69% 74% 64% 55%

Corruption High level of unemployment Poor quality of healthcare Lack of freedom of speech Lack of infrastructure Poor quality of education High crime rate Political instability

Survey Question: To what extent does each problem exist in your country? Source: Strategy& Arab Generational Divide Survey

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between the rich and the poor were seen as key issues. Despite these similarities, there are key differences between countries. Illiteracy was flagged as a key social issue in Morocco; political instability is much more of an issue in Lebanon, Syria, and Libya. Respondents in Libya also specify more governance issues, for example poor quality of healthcare, political instability, lack of infrastructure, high level of unemployment, and lack of transparency. Considering only financial challenges, the results also show a consistent pattern — respondents identified, in the following order: the high cost of living in the region, broad societal poverty, expensive healthcare, and expensive education as the four main issues. Again, these were more predominant in non-GCC countries, and the responses were shared across all non-GCC generations (see Exhibit 8, page 19).

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Exhibit 8 All GCC generations worry about the high cost of living and poverty. All non-GCC generations are concerned about all financial challenges.
Concerns About Financial Challenges

GCC 87% ADG 61% 53% 46% 29% 86% ARG 61% 53% 46% 29% 83% 56% 46% 32%

Non-GCC 83% 80% 75%

81%

80%

76%

85%

64% ANG

79%

81%

High cost of living Poverty High cost of healthcare High cost of education

Survey Question: To what extent does each problem exist in your country? Source: Strategy& Arab Generational Divide Survey

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Perceptions about education are striking. They show a growing level of dissatisfaction with the quality of education offerings in the region. The ARG is less satisfied with education standards than the ANG, and the ADG is the least satisfied. Just 56 percent of ADG respondents rated their personal education experience as either excellent or good (compared to 84 percent of the ANG). The same pattern held true when respondents were asked about the quality of education available in their country (as opposed to their own personal experience). The older generations were more satisfied, and the younger generations less so. Some inter-country differences are worth noting. The UAE, Kuwait, and Qatar all received higher ratings (95 percent, 79 percent, and 75 percent of respondents, respectively, from these countries assessed their education as either excellent or good). By contrast, Egypt’s scores were extremely low — just 16 percent of participants believed this of their national system. Clearly, in societies and countries with lower illiteracy rates, and higher per-capita GDP, education quality is perceived more positively — regardless of actual quality — than in countries with higher poverty and illiteracy rates. Although these are perceptions and not objective quality rankings, it is a common practice in evaluating education systems to gauge the views of the “customers” — the students themselves. For example, our recent study on students in the GCC revealed that they would like reforms to focus on developing more creative and inspiring content, improving teaching approaches, and addressing the lack of career guidance.10 Moreover, respondents indicate that they believe education is a basic right of citizenship — an entitlement that their national government must provide (along with healthcare and employment). Accordingly, those are areas where respondents feel governments should spend money — primarily on healthcare, employment, infrastructure, and education. This finding applies across all three generations and all six countries surveyed, with slightly lower rates among respondents in Egypt and Jordan (see Exhibit 9, page 21).

Perceptions about education are striking. They show a growing level of dissatisfaction with the quality of education offerings in the region.

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Exhibit 9 All generations regard healthcare, employment, and education as the most important entitlements

Top Entitlements from Government

100% 90% 74%

93%

98% 75% 62%

91%

100% 79% 79% 64% 58%

92%

45% 43% 29% 33% 29% 27% 0% Right to basic healthcare Right to employment Right to free primary/ secondary education 4% 7% 4%

None of the above

Egypt Jordan Kuwait Qatar Saudi Arabia UAE

Survey Question: Which of the following entitlements/ privileges are you and other citizens of your country entitled to receive from your government? Source: Strategy& Arab Generational Divide Survey

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The survey also looked at the way that citizens discuss politics and communicate with their governments. Again, the common ties are more noteworthy than the differences. All three generations are likely to discuss politics and news about their own country. They are relatively less likely to discuss the Arab region in general, and least likely to talk about issues concerning the U.S. or the Western world. That said, these communications are often linked to discussions with friends and family, and they happen through different channels for different age groups (face-to-face conversations among older Arabs, and via digital means for younger Arabs). It is notable that some of the survey countries, such as Jordan and those in the GCC, also have a traditional communication mechanism, the “majlis,” a gathering in which members of the public can meet with officials on a regular basis. Most notable, however, is that the bulk of these communications are within social groups, and not between constituents and governments. Overall, however, just 9 percent of respondents have communicated online with their political leaders, primarily to give a suggestion, express an opinion, or register a complaint. There is a generational component at work here as well. Given the lack of communication between the large and growing population of younger constituents and the generally older politicians shaping policies for the region, it is perhaps understandable that many governments do not currently meet the needs of young people. That situation needs to change as the disconnect will only perpetuate current problems. Among the reasons cited for not communicating online, the primary reason all three generations mentioned was a lack of interest. Among the younger generation, key reasons revolved around the lack of a conducive environment to communicate with leaders.

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Key priorities for policymakers and the private sector
As governments craft policies to ensure that their countries remain competitive, they must keep these findings in mind. Specifically, governments can address concerns about transparency and the perception that they serve the needs of only a well-connected minority by delivering government services in a new form, such as through e-government channels. These will foster greater participation among all generations, particularly the young. Providing government services digitally will generate the interest that is so lacking in youth and, by connecting these services to engagement mechanisms such as social media, can create trusted channels for feedback and dialogue. E-government services can also play a role in making overall public services faster, more responsive, and more transparent by helping to raise standards. This is because e-government leverages increasingly pervasive technology to make government services more customer-centric, improves digital literacy, creates public- and private-sector opportunities, strengthens ties between citizens and governments, and so improves the quality of life for constituents. Structured correctly, e-government initiatives can even generate economic value for governments — in addition to social and civic value — by helping create new jobs.11

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The world of work

A generational lens applied to labor trends and characteristics offers many insights to address the region’s labor force challenges, including unemployment, low productivity and employee engagement, and large public sectors. The public sector in the Arab region still acts as a magnet for young graduates attracted by high salaries, employment protection, and a special social status, in particular in state-owned enterprises. In the context of diminishing public budgets, these policies are not sustainable. Indeed, the private sector is increasingly expected to create the jobs that will lower the high unemployment rates among nationals, and moreover is supposed to retain these young employees. Family businesses in the region can also benefit from a generational analysis. For example, some of the largest and most visible corporations in the GCC region are family businesses. Many of these companies are now facing a leadership transition to younger generations where work styles and visions for the family business may differ across generations. The survey and focus group findings regarding generational differences in the work environment are intriguing. In some areas they show animosity and a lack of understanding across generations of their different work styles. These negative perceptions can restrict productivity and collaboration. For example, the focus groups revealed that older workers were perceived as slow and lacking in communication skills by younger workers — whereas younger workers are perceived as “stubborn” and “impatient” by the older generations. On the positive side, the younger generation is also perceived as bringing innovative ideas, being flexible, and taking the initiative. Also, the younger generations see themselves as more team-spirited than older generations (57 percent of the ADG identified with this trait, compared with just 26 percent of the ANG). The “impatience” factor shows up in other research about younger workers. One study about Generation Y globally found that they are likely to change jobs relatively frequently. The study shows that only
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The private sector is increasingly expected to create the jobs that will lower the high unemployment rates among nationals.

75 percent of people in the Middle East in this age group intend to stay in a job for more than two years. The numbers are even lower for more developed economies — only 57 percent of Generation Y workers in the U.K. plan to stay for two years — suggesting that short-term tenure among younger workers may become a growing issue in the GCC.12 Viewed in the positive sense, this could also be an opportunity to bolster youth entrepreneurship in the region and work on providing workers with life-long career guidance services. Most of the attributes associated with the older generation are positive: They are seen as punctual, leading by example, respectful, willing to teach, and appreciative. Significantly, the main attributes of the different groups do not overlap at all (see Exhibit 10).

Exhibit 10 ADGs are innovative, team players, and take initiatives but lag behind ARGs and ANGs in other workplace attitudes

Work Attribute Associated with Younger Generation (Top 5 Attributes)
62% 62% 58% 61% 57%

Work Attributes Associated with Older Generation (Top 5 Attributes)
75% 65% 73% 70%

66% 72% 72% Punctual

45% 40%

37%

42%

Bring innovative ideas ADG ARG ANG

Impatient

Take initiative

Flexible

Team spirit

26%

Willingness Controlling to teach

58% 66%

53% 50%

Lead by example

Respectful

Survey Question: Organizations have staff that comprises old and young employees. If you were asked to associate some attributes with staff older and younger than you, based on your experience and perceptions, which attributes would you associate with which generation of co-workers? Source: Strategy& Arab Generational Divide Survey

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63% 71% 68%

52%

67% 64% 70%

54%

57%

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Such differences could be a source of competitive advantage, in that diverse age groups bring complementary strengths to companies. In some cases, however, the differences can also lead to disagreements between younger and older workers. For example, as in other regions, older people tend to have a very traditional view of work and what it entails — set hours, always in the office, etc. By comparison, young people have a more flexible perspective, in which performance matters more than time spent at one’s desk. Some organizations in other markets have experienced similar disconnects between older and younger workers, and have taken steps to address these issues. For example, MITRE, a U.S.-based nonprofit that manages research projects for the federal government, had a high proportion of middle-aged workers, which led to higher turnover among younger workers. Many left MITRE because they did not feel that they fit in. In 2007, MITRE launched an effort to become more welcoming to younger workers through changes to the recruiting, networking, and onboarding aspects of HR. Younger workers can also provide feedback directly to executives at MITRE through both informal channels, such as lunches with the CEO, and more formal mechanisms, such as a millennial advisory committee that reports to the C-suite via quarterly meetings.13 Technology requires the strengths of the ADG One implication of these findings is that technology-oriented enterprises require the qualities exhibited by the ADG, particularly innovative thinking. As technology-dependent businesses grow in relative terms and as a percentage of GDP in the region, these qualities are worth cultivating, even if older generations find them troublesome. Related to the theme of technological development, the survey results show that Jordanians are the least satisfied with their financial situation among all six countries we analyzed. Jordan has recently been a regional hub for technology talent. However, the lack of financial opportunity in the country is eroding Jordan’s position in the digital sector, as many technologically skilled Jordanians are leaving for the GCC. A clear implication is that the region is competing against itself for digital talent and, in net terms, adding little incremental value to the region overall. Women in the workplace Gender equality in the workplace was a key area of inquiry during our survey. In general, the older generations are more likely to believe that women currently enjoy equal work opportunities with men. With some
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Young people have a more flexible perspective, in which performance matters more than time spent at one’s desk.

regional variations, approximately half of all ARG and ANG respondents believe this is true. However, the ADG are less likely to agree, and this disparity is more pronounced among women in the ADG. Only 45 percent of that group believe that women have the same opportunities to work as men. One potential explanation for these findings is that younger people in the Arab region have higher expectations. Many countries have made strides toward gender equality in the workplace, and while older workers may feel that those measures represent significant progress, younger people believe that it is not enough. Although this may be a perception predominantly expressed by younger workers, Strategy&’s Third Billion Index, which measures female economic inclusion, reaffirms the fact that measures taken to empower women in the past years in Arab countries have not been sufficient.14 Almost all of these countries are in the earliest stages in their efforts to economically empower women. Although each of these countries faces unique circumstances, governments and companies in these countries and throughout the Arab region have a powerful opportunity to boost their own economic growth by opening new doors for women. Cultural norms are crucial in assessing the belief in a woman’s right to work. More than 50 percent of all respondents, across all three generations, support women seeking employment, provided there are rules and regulations in place to respect the country’s traditions and culture. Respecting cultural norms also comes across strongly in the focus groups conducted with female workers. Another large percentage support women working in certain types of jobs in certain professions — such as nursing, education, or office work (i.e., non-physical labor). A far smaller minority support this notion unconditionally. The results also show strong support for women in the workplace in most GCC countries, despite their social conservatism. Support is much weaker in countries where unemployment is high — Egypt and Jordan — which could reflect a greater competition for scarce jobs. Among the GCC respondents who support women working, there is broad agreement about the reasons for this: namely so that women can be productive, contribute financially to their households, take advantage of their education, secure their children’s future, give them the freedom to meet new people, and broaden their perspective on life. In other countries however, the reasons for supporting women were different. The majority of respondents support a woman seeking employment so that she is able to play an important role in securing her family’s future, or so that she is able to financially contribute to the household, rather than simply to be productive or “make herself useful.” Again, these findings perhaps reflect the need for both parents to contribute to the household income in countries with higher poverty rates and more income challenges.
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Although support for women working is clearly increasing, women continue to face many challenges. Women’s labor force participation in the Arab region is just 26 percent, compared with that in South Asia (35 percent), East Asia and the Pacific (64 percent), and sub-Saharan Africa (61 percent). Improvement efforts for women in the workplace need to ensure that women are both prepared with the right education and enabled with the right support. Key improvement opportunities include diversifying university majors offered to women, teaching skills required for the job market, promoting local female entrepreneurship, and identifying opportunities for women to work from home. Notably, the majority of respondents who support women seeking employment are least aware of the positive impact of such measures on the overall economy (see Exhibit 11, page 29). This is a potential opportunity to educate citizens, as there is convincing evidence that adding women to the workforce can spur economic growth. For example, Strategy& research indicates that raising female employment to male levels would boost the overall GDP of the UAE by 12 percent, thanks to the increased productivity of a national workforce that would be approximately doubled in size. For Egypt, the effect would be even more pronounced — equitable employment levels for women would boost GDP by 34 percent.15 There is a leverage effect as well — economically empowered women are more likely to invest a portion of their household income on education for their children. As those children grow up, they will pursue careers of their own, creating further social and economic gains for the country. This is one way in which an awareness of generational effects can help policymakers craft policies that lay the groundwork for long-term growth. Among those who do not support women working, the principal arguments are that women need to stay at home and take care of the family, that it is not safe, and that it runs counter to tradition and culture. These reasons were similar in the supplemental set of countries, with the top two reasons being the need to stay at home and take care of the family (70 percent) and the safety issue (44 percent). Regarding employment benefits, respondents in all three generations agreed that priority items should be free health insurance for the employee and his or her family. This was followed by a housing allowance, flexible working hours, and an education allowance for children. Notably, child care was a key priority in Kuwait, which is understandable given the high percentage of working Kuwaiti women — some estimates put this number at more than 40 percent of the female population. Also significant is that there was no difference between men and women regarding the demand for employer-based child-care facilities — men in the region were as likely to demand child care as women.
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Economically empowered women are more likely to invest a portion of their household income on education for their children.

Exhibit 11 Supporters of female employment recognize its individual utility but not its national economic importance
Reasons to Support Female Employment

59% 58%

56% 49% 51% 52%

53%

49% 46%

50%

53% 44% 42% 43% 38% 36% 37% 35% 34% 30%

41%

Make herself useful ADG ARG ANG

Contribute financially to the household

Make use of her education

Play a role in securing her children’s future

Freedom to meet new people and broaden life

To afford modern luxuries and amenities

It is good for the national economy

Survey Question: Which of the following statements best describe why you support women seeking employment? Source: Strategy& Arab Generational Divide Survey

Indeed, the lack of child-care facilities is probably one of the biggest impediments to female employment in the region. If companies and governments want to see women reach their maximum economic potential, these organizations must play a role in helping to provide care. This conclusion is borne out by the data: OECD countries that have the highest public spending as a percentage of GDP on child care and education services for children under age 5 have higher employment among mothers with young children.

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Key priorities for policymakers and the private sector
The results of our survey point to several policy imperatives for Arab governments regarding the workforce. First and foremost, countries in the region must reform their education systems to better prepare students for the workplace. This includes measures to strengthen standards in science, technology, engineering, and math (known as STEM); better incorporate digital technology in schools; and improve vocational training. Second, related to these efforts, governments must get better at human capital planning. The goal is not merely to focus on the most urgent mismatches but to plan comprehensively and long term, across the generations, by understanding skills gaps and growth industries and their workforce needs. Third, governments should take active measures to foster creative and digital industries — such as media, advertising, design, architecture, and related fields — which are a key component of knowledgebased economies and play directly to the strengths of the ADG. Companies in these industries are typically more innovative and flexible. They also employ women in larger numbers. Fourth, governments must better integrate the private sector in education, through programs such as mentorships, internships, and a closer collaboration on standards and curricula. After all, companies are the “end users” of the education system, and more direct collaboration will help them ensure they get a steady stream of graduates with the skills that companies need to compete. Fifth, regarding women’s employment, governments and the private sector must work to create women-friendly work environments, with policies that encourage flex-time, on-site child care, better networking opportunities, and other features that will attract talented women to the workplace. Last, governments must unlock the growth potential of the private sector. This is a broad realm, worthy of a vigorous debate. However, as long as companies in the region face barriers to growth they will be unable to provide sufficient opportunities for the region’s willing workers. Specific measures include the reform of key industries such as finance to reduce monopolistic behavior; fostering entrepreneurship by making it easier to start companies and gain access to credit; and eliminating barriers to the flow of talent, labor, and ideas throughout the region.

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Technology, media, and consumerism
The survey results show clear differences among the generations regarding their use of digital technology to consume information and make purchases. These findings break down into three areas, technology, media, and consumerism. Technology Perhaps unsurprisingly, there are sizable differences in how the generations use technology. The ADG is more likely to use laptop/ netbook computers and mobile devices such as smartphones, whereas the ANG is more likely to use desktop computers (see Exhibit 12, page 32). The frequency of usage is closer among the generations, however: 86 percent of the ADG access the Internet on a daily basis, compared with 63 percent of the ANG (see Exhibit 13, page 33). This gap is likely to narrow as technology becomes more pervasive. With the region’s citizens becoming increasingly technologically literate and connected, the development of electronic government services is crucial for its own sake and as part of a country’s broader technological development. At the national level, e-government is an essential response to pressure from citizens and companies for modernization, better service, transparency, and participation. Countries in the Arab region vary in their levels of e-government readiness, but as a whole the region lags behind much of the globe.

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Exhibit 12 Younger generations, especially in the GCC, have the highest usage of smartphones and laptops
Which of the Following Electronic/Communication Devices Do You Use Personally in Your Daily Life?

Egypt Basic Mobile Phone (without Internet connectivity feature) Smartphone (with Internet connectivity feature) 68%

Jordan 62%

Kuwait

Qatar

Saudi Arabia

UAE

49%

44%

47%

40%

25%

27%

26%

20%

22%

19%

26%

40%

13% 87% 30% 83% 45%

13% 65% 88% 50% 79%

7%

100%

74%

74%

66%

88%

66%

69%

53%

45%

37%

74%

21%

28%

60%

25%

23%

92%

66%

25%

Desktop Computer

52%

60%

61%

65%

41%

61%

38%

38%

62%

37%

32%

35%

36%

78%

60%

Laptop/ Netbook Computer Tablet Computer (iPad, Galaxy Tab, etc.) ADG ARG ANG

61%

58%

62%

64%

48%

35%

48%

31%

44%

60%

50%

46%

39%

22%

49%

31%

29%

16%

11%

13%

16%

7%

3%

20%

30%

32

31%

Note: Figures do not sum to 100 percent because of small numbers responding “None of these.” Source: Strategy& Arab Generational Divide Survey

37% Strategy&

65%

36%

82%

9%

Exhibit 13 ADGs have the highest daily Internet usage, with all generations well connected
Percentage Who Access the Internet Daily

97% 87% 77% 68% 59% 85% 89% 78% 80% 70% 72% 53% 80% 81% 65% 85% 69% 56% 86% 77% 63%

Egypt ADG ARG ANG

Jordan

Kuwait

Qatar

Saudi Arabia

UAE

Total

Survey Question: How often do you access the Internet? Source: Strategy& Arab Generational Divide Survey

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To successfully implement e-government models, Arab region states must take a customer-centric approach to their government services, understanding each service from their constituents’ perspective to determine how best to provide them. An area gaining traction globally in this domain is mobile e-government applications. Policymakers across the globe are currently rushing to launch mobile apps as they have the potential to help governments deliver e-services far more efficiently than other e-channels. Designed correctly, mobile apps are highly personal, always on, and extremely easy to use. Another common element is that perceptions of the Internet are largely positive. Across the generations, respondents are more likely to agree with positive statements about its influence (such as “The Internet has made us more informed, educated, and connected,” or “The Internet has made our lives easier”) than negative statements (“I worry about the influence that technology is having on our traditions,” and “I worry that children are being exposed to immoral content on the Internet”). That said, there is a notable fear that technology will have a negative impact on traditions — across all three generations, more than half of respondents expressed this sentiment, led by the ANG. From an ADG standpoint, the intersection of behaviors relating to work and technology is driving demand for a more a digital workplace. Designed correctly, the workplace of the future can boost productivity, improve employee morale, and attract the next generation of talent that is demanding greater freedom in managing how they work, where, and when. In designing the “digital workplace of the future,” organizations need to take into account all the different stakeholders with whom the employees interact: their co-workers, customers, vendors, suppliers, partners, and even friends and family. Ultimately, the new workplace architecture should seamlessly combine five key features: the right access devices, an appropriate communication infrastructure, the necessary business applications, a team-oriented workplace environment, and an overarching digital security apparatus. Media In addition to being connected through the Internet, the three Arab generations have adopted social networks extensively. With a cohort of young adults who are both multilingual and technology-savvy, the region has seen a significant rise in social media applications and networks, whether for social, commercial, or political purposes. Among Internet users in the respondent base, some 95 percent of the ADG, 94 percent of the ARG, and 83 percent of the ANG have access to at least one social network. Specific rates of adoption vary by platform. For Facebook, the ANG has the highest adoption rate, whereas for
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Twitter, the ADG leads. Google Plus and Instagram show a similar distribution, but at lower overall adoption rates. Regarding specific usage patterns, social media platforms are typically used more for staying connected with family and friends and employment purposes (such as networking), rather than to discuss politics. More than 60 percent of respondents use social networks to identify job opportunities, as has happened in other markets, making social networks a relevant platform for classified advertising (see Exhibit 14). If they are to engage

Exhibit 14 Soliciting feedback on products and services is an important activity on social networks
Most Common Uses of Social Media

89% 79% 75% 67%

85% 70% 67% 63%

84%

81% 65% 71% 67% 59%

58%

Networking/connecting with new people

Read about/look at what my friends/ family are doing

Network for job opportunities

Get advice and ideas

Seek recommendation or feedback on products, services, and brands

ADG ARG ANG

Note: Results correspond to the share of respondents who answered the question for each of the five activities “always,” “often ,” and “sometimes.” Survey Question: How often do you discuss with others the follo wing elements on social media platforms?

Source: Strategy& Arab Generational Divide Survey

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with governments and express their needs as citizens, the majority of ADG and ARG respondents opt to use blogs and social media, rather than traditional media channels. Even the ANG is actively adopting digital platforms for the same purpose. Moreover, although ANG and ADG members spend similar amounts of time with digital platforms, they still communicate in different ways, particularly in how they express their opinions as citizens. For members of the ANG, most political discussions still take place face-to-face, through gatherings, whereas social media and blogs dominate the political discourse for the ADG and the ARG. This has profound implications on governments’ ability to sustain the effectiveness of their official communication channels with their citizens and residents. It is worth noting that although all of these are two-way channels, there remains a question as to whether governments in the region view them as such, and are willing to actively solicit opinions through these channels. Many regional governments, however, have only recently started to engage their constituents through social media, and this engagement is mostly reactive in nature. As today’s social media users expect engagement that is transparent, crowdsourced, and responsive, governments that are already leveraging social media can improve engagement by being less static and seeking to better gather user input. If governments hope to be heard by their constituents, particularly by the ADG, who are frequently glued to their mobile phones, they will need to learn the language of social media to ensure that their constituents feel they can directly express their opinions and concerns to those governing them. To effectively deal with the challenge of social media, governments must adopt a three-pronged approach. First, they must integrate social media within their official communications channels — including all traditional media platforms — in a coherent manner. One way to do this effectively is to factor in social media as a publishing platform for content during the early stages of curation and production of the content itself (see Exhibit 15, page 37). Second, they must develop capabilities to deliver social media services successfully to constituents across many areas. Third, they must ensure their social media strategy and offering make room for future progress, evolution, and growth that can further improve their interactions with constituents.

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Exhibit 15 The role of proprietary content creation is increasing
Example of “Next Generation” Audioivisual Content Distribution Model

Television Studio

DVD/ Home Video

Mobile

Online/ OTT1

Social Media

Television Network

Television Syndication

Television Stations

Cable Networks

Regional/ International Distribution

Digital/OTT1

1

Over the top.

Source: Strategy&

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Government should also leverage the increasing prominence of national broadcasters as leading “over the top” (OTT)16 players. Traditional television (TV) broadcasters are increasingly becoming the most trusted source for video services on OTT platforms. Public service broadcasters could leverage this trend to build a communication channel with consumers who have a clear preference for non-linear content consumption.17 This could encourage “digital-only” content commissioning within public broadcasters, an area that is increasingly generating interest and passion among ADG citizens in GCC states. Moreover, this could also be an effective platform for integrating e-government services. The survey results also show that traditional mass media advertising channels, with the exception of TV, are becoming less effective in reaching consumers. Only 23 percent of the ADG and the ARG are influenced by messages through these channels. Most marketers have not adapted to this shift, however — non-TV mass media still attracts close to 60 percent of advertising budgets of marketers targeting local markets.18 The problem with digital advertising is more acute. For a majority of the ADG and the ARG (60 percent and 55 percent, respectively), roughly half of all advertising is considered wasted. The number is somewhat lower for members of the ANG (just 36 percent). This may be attributable to the excessive use of automated tools such as ad exchanges and bulk SMS. Regardless, it is a pointed message to companies in the region on the need for improved targeting and contextualization, to create marketing messages that will truly resonate and drive purchasing decisions. Finally, TV commercials continue to have a dominant influence on members of the ANG. Although the relevance of TV commercials is still great for the ADG, it remains a larger challenge to get a similar level of brand awareness with this group. While the ADG continues to spend the majority of its media time on TV content, its consumption is spread out between linear viewing and non-linear viewing on Internet protocol television (IPTV, in which TV is delivered over broadband) or OTT

Traditional TV broadcasters are increasingly becom­ing the most trusted source for video services on OTT platforms.

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platforms, consumed seamlessly via the TV screen, tablets, and PCs. As a result, marketers who hope to reach ADG consumers must integrate their marketing efforts across media platforms. Therefore, advertising on digital platforms needs to increase and better reflect the way that people consume media in the region. Budgets should be aligned in proportion to the time spent on specific media, and the growing influence of digital platforms in driving consumer decisions. There are several innovative and targeted advertising platforms emerging in the region, such as IPTV advertising, locationbased marketing, and video advertising on OTT. These can all be leveraged by marketers to improve the effectiveness of their spending and reach consumers where they spend their time today, as opposed to how they spent their time a decade ago. Consumerism A core theme of the findings is that social media are growing in relevance regarding purchasing behavior. More than two-thirds of respondents across all generations regularly use social networks to seek recommendations to guide buying decisions. However, compared to developed countries, marketers in the region are not yet tapping this trend. Although social media are rapidly evolving from mere networking platforms to means of influencing purchasing behavior, local companies are missing an opportunity. Taking advantage of this shift will require focused effort in several areas. Marketers must develop a formal strategy to integrate social media into their overall marketing plan. They also must make investments in social media– driven customer service channels, creative content development that works on social media, and rapid monitoring and customerengagement response teams. Marketers in developed countries are already building social media teams with roles that include community managers, creative talent, and data analysts who can study consumer behavior for insights.

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Even as social media grow, however, most purchases still take place through traditional channels. Online shopping has yet to take off, with regional levels of e-commerce and mobile commerce still low compared to other parts of the world. Among the overall population, only a third say they have bought something online in the past 12 months. A potential bright spot is that younger people show slightly higher adoption rates, particularly in Kuwait and Saudi Arabia (see Exhibit 16).

Exhibit 16 Around one-third of respondents who access the Internet made online purchases in the last year
Percentage of Internet Users Who Purchased Online in Past Year

52% 49% 42% 38% 37% 29% 23% 37% 35% 26% 23% 28% 24% 41%

27%

24%

11% 3% Egypt ADG ARG ANG Jordan Kuwait Qatar Saudi Arabia UAE

Survey Question: In the past 12 months, have you personally made any online purchase? Source: Strategy& Arab Generational Divide Survey

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Participants list several common reasons for why they have not purchased more goods online, namely that they prefer to deal with an actual person; prefer to pay by cash; prefer to see the product in person before buying it; or have concerns about fake websites, security of online payment, or product quality (see Exhibit 17). There was no clear pattern among the three generations regarding these factors. The ANG was far more likely to prefer cash payments, and far less likely to worry

Exhibit 17 Those not purchasing online prefer traditional outlets and worry about online security
Top Five Reasons for Not Shopping Online

52% 40% 35% 37% 38% 42% 36% 36% 29% 32% 33% 32% 32% 30% 25%

Prefer to deal with actual person ADG ARG ANG

Prefer to purchase using cash

Worries about fake websites

Prefer to see/feel actual product

Worries about payment security

Survey Question: Which of these reasons prevent you from making purchases online? Source: Strategy& Arab Generational Divide Survey

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about fake websites. However, the ADG was more likely to worry about hidden costs or fees. By contrast, the ARG was more concerned that the quality of products purchased online was not guaranteed. This likely reflects the fact that e-commerce in the region is still at an early stage, and concerns are driven more by perceptions than actual experiences. In other markets e-commerce is governed by a set of tax, regulatory, and legal constraints — consequently, security is less of a concern. However, there are some positive notes for consumer brands and retailers in the region: Social networks are increasingly informing purchasing decisions. The private sector is making diligent use of social media to reach key audiences and improve marketing and customer relationship building efforts. However, realizing the full commercial potential of social media will require a focused effort from marketers to channel these interactions for more than just brand awareness. The private sector will also need to drive product development, enhance customer service, generate excitement for new launches, and potentially even drive social commerce (i.e., spur the online sale of product “stores” on social networks). One could argue that the Arab region will see stronger adoption, uptake, and success of social media–driven e-commerce than in other parts of the globe. For one thing, the culture lends itself to strong ties with family and friends, amplifying their role in influencing purchasing decisions. Moreover, many of the hurdles cited in the uptake of e-commerce, such as worries about fake websites and lack of guarantee on quality of products, are more easily addressed on a trusted social network platform than on pure, independent e-commerce platforms. However, the true success of social commerce is not possible unless the consumer brands and marketers recognize social stores as a critical part of their multichannel strategy. There are several unique benefits that social commerce provides to consumer companies: • Combining social media with commerce can enable new pricing and sales models, including group selling and access to proprietary communities; • Purchases are published through social means, thereby resulting in additional sales among the purchasers’ friends and providing another activation point for loyalists to espouse the brand; • New forms of data enable better and more targeted offers.

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Key priorities for policymakers and the private sector
Technology is perhaps the biggest differentiator between successful economies and laggards. Policymakers must recognize that, used effectively, technology is a tool that can catalyze economic growth. The longer that governments delay digitization — the mass adoption of connected devices by government, enterprises, and individuals — the more they are costing their economies in terms of potential growth, jobs, and value creation. The appetite for digitization across the three Arab generations needs to be matched with policies to enable greater uptake of digital technologies, and infrastructure investments to ensure that all populations have access to speedy, reliable information channels. Regarding the media, the fear among all three generations about a dilution of values due to technology puts the onus on governments. Currently, Arabic speakers represent roughly 5 percent of the global population, yet online Arabic content represents approximately only 1 percent to 2 percent of global content. Policymakers can address this by funding the creation of local and regional Arabic content that is meaningful, compelling, and educational, particularly for younger readers. In addition, ministries of information and public service broadcasters are struggling to meet their mandate and serve as the official communication channel of governments at a time when traditional channels are losing their dominance. Traditionally, they have focused on distribution platforms. However, given the fragmentation of traditional distribution channels, they will need to undertake a meaningful analysis of how best to engage with citizens via social media and other digital media channels, and adopt a more customer-centric view of communication. The key is to focus on developing high-quality, entertaining content with well-integrated public service messages, and distribute it through a cross-platform strategy. The distribution approach should involve only proprietary channels and also leading social media platforms and other relevant third-party digital distribution channels. With respect to online commerce, governments should seek to spur e-shopping by helping develop the underlying infrastructure and services required across the value chain. These include initiatives geared toward building a trustworthy and effective e-payment system, and “next generation” postal services enabled to support e-commerce, among others. This effort should be included as part of a broader regional digitization effort, and it could come through a collaboration between business and government. In addition, governments could introduce customer protection regulations and enforce standards to reduce the perceived risks of online shopping.

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Conclusion

During a period of significant political and social disruption in the Arab region, governments must understand that their populations are not a single, homogeneous bloc. Instead, they have unique perspectives, attitudes, and perceptions, which have been shaped by the state of the region and the world as their different generations have encountered it. For example, given recent changes to the global business environment and technology, the younger generation can no longer think and act as their predecessors did in their youth. These generational differences — and commonalities — must be taken into account when shaping national policies. If governments are to create a stable social and governance platform that can foster economic growth, they must continually monitor generational differences and adapt to ensure they are addressing the individual requirements and priorities of all groups in their citizenry. Similarly, companies must understand the characteristics of these generations to create a stronger workforce and to stimulate value creation through the promotion of e-commerce and digital technologies.

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Additional findings

Exhibit 18 ADGs and ARGs across the region have more higher education than ANGs
Educational Attainment

GCC

Non-GCC 71%

35% ADG 3% 10%

45% 5% 54% 2% 1% 11% 3% 57% 15% 13% 9% 4%

0%

0%

26% ARG 3%

11%

4%

2%

1%

4%

8%

4%

0%

40% ANG 11% 7%

33% 5% 2% 1% 9%

42% 27% 8% 8% 3% 2%

Elementary school Secondary school Vocational college education (e.g., to qualify as an elect) University first degree (e.g., BA, BSc) University higher degree (master's, MBA, Ph.D.) Professional higher education (e.g., to qualify as a lawyer) No formal education but can read and/or write

Source: Strategy& Arab Generational Divide Survey

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Exhibit 19 Across the region most ADGs live with their parents in large households
Family Ties
GCC 62% 29% ADG 5% 3% 0% 0% 1% 34% 4% 3% 0% 2% 0% 58% Non-GCC

83%

75%

ARG

11% 92%

17% 4% 2% 0% 0% 0% 89% 4% 3% 0% 0% 1%

ANG

1%

3%

2%

1%

0%

1%

4%

2%

3%

0%

0%

2%

I live with my immediate family (spouse/children) I live with my immediate family (parents/brothers/sisters) I live with my extended family (spouse/children and parents) Live alone, by myself Staying as a paying guest Sharing accommodation with colleagues/friends/others Other

Source: Strategy& Arab Generational Divide Survey

46

Strategy&

Exhibit 20 All generations view social restrictions as a challenge in Egypt, Jordan, Kuwait, and Saudi Arabia
Views of Social Challenges
GCC 86% ADG 51% 46% 43% 44% 41% Non-GCC 74% 72% 68%

56% 50%

33% 34% 27%

43% 40%

86% 80% 75% ARG 52% 47% 47% 41% 36% 35% 36%

67% 62% 60%

53%

46%

22%

84% ANG 52% 48% 47% 43% 39% 37%

76% 71%

56% 62% 60% 56%

31%

45%

22%

Social restrictions High divorce rate Discrimination based on social status Widening gap between the rich and poor Lack of gender equality Illiteracy Racial discrimination Lack of cultural openness

Survey Question: To what extent does each problem exist in your country? Source: Strategy& Arab Generational Divide Survey

Strategy&

47

Exhibit 21 GCC generations identify basic healthcare provision as an important entitlement
Awareness About Right to Receive Basic Healthcare

Egypt ADG 45%

Jordan 51%

Kuwait 100%

Qatar 89%

Saudi Arabia UAE 56% 90%
Survey Question: Which of the following entitlements/ privileges are you and other citizens of your country entitled to receive from your government? Source: Strategy& Arab Generational Divide Survey

ARG

48%

39%

99%

92%

79%

91%

ANG

43%

41%

100%

87%

87%

97%

Exhibit 22 GCC generations outside Saudi Arabia believe strongly in a right to employment
Belief in a Right to Employment

Egypt ADG 29% 30% 27%

Jordan 42%% 27% 31%

Kuwait 100% 95% 100%

Qatar 70% 78% 78%

Saudi Arabia UAE 45% 61% 81% 88% 91% 95%
Survey Question: Which of the following entitlements/ privileges are you and other citizens of your country entitled to receive from your government? Source: Strategy& Arab Generational Divide Survey

ARG

ANG

48

Strategy&

Exhibit 23 GCC generations are strong believers in a right to education
Belief in a Right to Education

Egypt ADG 67% 70% 50%

Jordan 68% 57% 49%

Kuwait 100% 99% 100%

Qatar 77% 81% 80%

Saudi Arabia UAE 68% 81% 87% 89% 91% 97%
Survey Question: Which of the following entitlements/ privileges are you and other citizens of your country entitled to receive from your government? Source: Strategy& Arab Generational Divide Survey

ARG

ANG

Exhibit 24 Kuwait’s generations have the highest employee satisfaction, with Qatar’s the lowest
Employee Satisfaction in the Workplace

Egypt ADG ARG ANG 16% 25% 24%

Jordan 6% 39% 25%

Kuwait 90% 71% 80%

Qatar 18% 17% 22%

Saudi Arabia UAE 14% 32% 70% 11% 40% 23%

Note: Higher percentage shows higher satisfaction level. Survey Question: Overall how satisfied are you with your current job? Source: Strategy& Arab Generational Divide Survey

Strategy&

49

Exhibit 25 Most unemployed women believe there are insufficient work opportunities, ANG women in the GCC are the most uncertain of their capabilities
Women’s Explanations for Unemployment

GCC 46% 45%

Non-GCC

21%

23%

14%

11%

14%

10%

10%

11%

18%

8%

8%

5%

6% 10% 4%

10% 2% 2%

8%

ADG

16%

18%

19%

21%

3%

1%

3%

45%

36%

35%

25%

23%

22%

24%

24%

20%

28%

18%

14%

11%

10%

15%

ARG

17%

3%

9%

8%

7%

1%

1%

51%

37%

39%

34%

44%

3%

26%

18%

17%

16%

20%

11%

11%

11%

ANG

22%

32%

6%

6%

7%

9%

4%

2%

1%

6%

6%

I do not have the right qualifications to be employed I need to look after my children It would be against the wishes of my husband/parents There are not enough opportunities to work In my community it is not acceptable for women to work I simply don’t want to work Lack of support in child care Lack of support in carrying out household responsibility Work timings are not suitable for me It is unsafe for women to work I used to be employed but left for personal reasons I used to be employed but lost my job Other

Source: Strategy& Arab Generational Divide Survey

50

Strategy&

1%

5%

Endnotes
The Economist Intelligence Unit, “Spring Tide: Will the Arab risings yield democracy, dictatorship or disorder?” 2011 (https://www.eiu.com/public/topical_report. aspx?campaignid=arab_spring_tide_wp).
1

Richard Shediac, Samer Bohsali, and Hatem Samman, “The bedrock of society: Understanding and growing the MENA region’s middle class,” Strategy&, 2012; Dr. Mona AlMunajjed and Karim Sabbagh, “Youth in GCC countries: Meeting the challenge,” Strategy&, 2011; “Understanding the Arab Digital Generation,” Strategy&, 2012.
2

Population Reference Bureau, “Population Trends and Challenges in the Middle East and North Africa,” 2001 (http://www.prb.org/pdf/PoptrendsMiddleEast.pdf).
3 4

“Designing the digital workplace: Connectivity, communication, collaboration,” Strategy&, 2013.

“Generations,” Ipsos MORI Social Research Institute, 2013 (http://www.ipsos-morigenerations.com).
5

GCC countries include Bahrain, Kuwait, Qatar, Oman, Saudi Arabia, and the United Arab Emirates.
6

Dr. Mona AlMunajjed and Karim Sabbagh, “Youth in GCC countries: Meeting the challenge,” Strategy&, 2011.
7 8

United Nations Development Programme, Kuwait National Youth Survey, 2012.

Natalie Calvert, “The Customer Service Leadership Challenge: Why understanding Baby Boomers, Generation X and Generation Y holds the key to smart 21st century customer service leadership,” Institute of Customer Service, 2010 (http://tinyurl.com/oo537z7).
9

Richard Shediac, Dr. Leila Hoteit, and Dr. Mounira Jamjoom, “Listening to students’ voices: Putting students at the heart of education reform in the GCC,” Strategy&, 2013.
10

Ramez T. Shehadi, Dr. Raymond Khoury, Fady Kassatly, and Abdulkader Lamaa, “Selfsustainable e-government: A road map to financial independence and value creation,” Strategy&, 2013.
11

Sue Honoré and Carina Paine Schofield, “Culture Shock: Generation Y and Their Managers Around the World,” Ashridge Business School, November 2012 (http://tinyurl.com/l3jpzr7).
12

Linda Roundtree, “Age: A 21st Century Diversity Imperative,” Executive Case report No. 4, Boston College, The Sloan Center on Aging and Work, 2011 (http://tinyurl.com/lkckyjr).
13

DeAnne Aguirre, Leila Hoteit, Christine Rupp, and Karim Sabbagh, “Empowering the third billion: Women and the world of work in 2012,” Strategy&, 2012.
14 15

“Empowering the third billion: Women and the world of work in 2012,” Strategy&, 2012.

OTT involves using the Internet to stream content directly to handheld devices, game consoles, and TV sets connected to broadband.
16

Linear services refers to standard TV service where the viewer watches a scheduled TV program only at the particular time it is aired and on the particular channel broadcasting it. Non-linear is the ability to access TV services whenever the consumer wants.
17

Bahjat El-Darwiche, Jayant Bhargava, and Sami Abou Jamous, “Value retention by newsprint publishers in the MENA region. A three-pronged strategy: Optimized performance, digital transformation, revenue diversification,” Strategy&, 2013.
18

Strategy&

51

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