Saudi Arabia has experienced a real reform in the last few years making it a more attractive destination to live, work, study, and set up a business. Saudi Arabia has been transforming its business landscape, investing in private sector business growth and the overall economy, and as a result, private sector jobs are booming.
A recent report released by The National Labor Observatory (NLO) highlighted an increase of 10.53% in private-sector employment so far in 2024.
As of 3rd July, there is a reported 11,805,102 private sector employees working in Saudi Arabia’s Labour market. This number is growing weekly with the NLO tracking and reporting live statistics on the labour market in Saudi Arabia which is forecast to grow to 16.54 million by the end of 2024. It is no secret or surprise that Saudi Arabia is attracting the attention of businesses and professionals across the globe.
Saudi Arabia is implementing visibility, accessibility, and growth strategies to rapidly increase the population, and job market demand and create an increasingly attractive environment for private sector businesses.
Saudization: The Local Labour Markets in Private Sectors
Many factors contribute to the growth of the private sector job boom, one of them being Saudization requirements for private sector businesses.
Since Saudi Arabia implemented its Saudization strategy, more of the local market is working in the private sector. This means that a combination of local and expatriate employees contributes to the rise in private-sector job growth and opportunities.
As Saudization dictates the requirement for Saudi / GCC National employees as part of company compliance, there have been new roles and positions created to meet these targets.
The Saudization or Nitaqat programme has been created to balance the local and expatriate workforces. Its primary focus is creating opportunities for Saudi Nationals to work and integrate into the private sector. Companies that adopt Saudization and maintain targets have received a range of incentives such as easier access to expat work visas, priority in government contract bids, and reduced government and licensing fees.
In May 2024, new regulations for Nitaqat were released to broaden the definition of individuals that would be considered ‘Saudi workers’ for Saudization purposes. This change allows more flexibility in hiring expatriates which means companies can optimise their workforce without worrying about negatively impacting their Saudization percentages.
Changes such as this showcase how Saudi Arabia is working together with private sector businesses to strike an even balance which will positively impact the business environment for both employees and employers and create a healthy and competitive job market in KSA.
Regional Headquarters (RHQ) Requirements: More Positions to be Filled
When Saudi Arabia announced the Regional Headquarter requirements in 2022, it became clear that Saudi Arabia was trying to encourage private sector business and economic growth.
Saudi Arabia saw the opportunity to encourage multinational companies in the Middle East and North Africa (MENA) region to establish their regional headquarters in Saudi Arabia. By setting up your RHQ in KSA, companies will benefit from tax and other incentives in return for access to the largest and fastest-growing market in the GCC.
A Saudi RHQ requires the entity to employ a minimum of 15 full-time employees, including three Executive Director/ C-Suite level employees within one year of issuance of the RHQ license. These conditions for the Saudi RHQ will continue to create more private sector job roles locally to be able to fulfil the RHQ requirements and compliance. These employees will bring their families and so the population and job market growth will expand from here.
The Impact of the Events Industry
It is hard to name a recent global event that Saudi Arabia hasn’t bid for or won in the last year few years. Saudi Arabia has been pushing its tourism and events industry with events on the horizon in Saudi including INDEX, Hotel Shows, Expos, and major sports and concert events. With an increase in events in the Kingdom, we are seeing a high demand to get people on the ground to fulfil shortages in skilled employment for these events and short-term projects.
The demand for Saudi Temporary work visas has increased by 24% in the last quarter with more companies requiring people on the ground to complete these projects.
The Temporary work visa in Saudi Arabia lends itself perfectly to this type of work in events as it allows companies to bring in skilled employees on a short-term basis to complete projects. It gives the applicant the ability to live and work in Saudi Arabia for up to 3 months, which can be extended a further 3 months if required.
As a result of the visa being temporary, it does not follow the same requirements as a work permit or residency (Iqama) in Saudi Arabia, meaning employers are not required to provide medical insurance and many of the other employee portal, labour and social insurance requirements of a full-time employee. The temporary work visa has been vital in being able to provide a solution for companies to get employees on the ground quicker to complete projects.
Hosting world-class events in the Kingdom assist in exposing Saudi Arabia to a global audience. Saudi Arabia can showcase itself to the world as a hub for tourism, entertainment, and business.
A Domino Effect: Increasing Demand for All Sectors
With reforms, easing business conditions and expanding ways to market entry, private sector job opportunities will continue to rise across Saudi Arabia as the economy expands and grows.
As the job market grows in Saudi Arabia there will be more requirements across all industry sectors such as healthcare, retail, and education as more expats move over to live and work. More people on the ground means a higher demand for resources which has a domino effect in the creation of jobs in Saudi Arabia.
