During the first decade of the 21st century the Gulf States undertook reforms of their social policies based on the generous redistribution of hydrocarbon profits. One of the elements of the redistribution was to guarantee of employment. Beginning in the 1990s rising unemployment indicated that the traditional employment policies were ineffective, generating social tensions as evidenced in the "Arab spring". The goal of the reforms is to move nationals into salaried jobs in the private sector, currently held largely by foreign workers. The change is strongly opposed by business executives and local entrepreneurs. Having become accustomed to inexpensive foreign workers they object to the increased costs entailed by the reforms. The royal families are thus obliged to negotiate between the interests of the private sector, often aligned with their own, and the dissatisfaction of the young, the group most impacted by unemployment and the key players in the protests that erupted in 2011 in Bahrain, Saudi-Arabia and Oman.
The sudden slump in oil production since 2001 has only heightened the question of an alternative to an economy based on oil revenues, whereas the sultanate had undergone exponential development over the three preceding decades. From this standpoint, the policy of Omanizing the labor force conditions all other issues, as it is not merely an economic matter, but instead deeply alters the social fabric that remained intact during the era of prosperity, thereby questioning the very legitimacy of Oman’s economic model. Omani society is currently experiencing a rise in frustrations reflected in a resurgence of particularist prejudices and demands. Alongside this phenomenon is an exacerbation of inequality, particularly due to the enmeshment of economic and decisionmaking powers in the hands of the oligarchy that has benefited from these revenues since 1970. To what extent do the changes Oman is going through today harbor a threat for the stability of a regime considered to be one of the most stable in the region?