Saudi Arabia ranks first among G20 countries in labor force growth rate
Unemployment rate in the country decreased to 5.8% in Q2 of 2022 from 6% in Q1 of 2022
As Saudi Arabia is undertaking massive economic diversification, the Kingdom has ranked first in the labor force growth rate among the Group of 20 countries during the period 2012 — 2021, according to a recent report launched by the National
Labor Observatory.
This comes as Saudi Arabia has shown positive signs in the main labor indicators, which are based on global benchmarks issued by the International Labor Organization, as the Kingdom is steadily progressing in its efforts to create more jobs in line with Vision 2030.
The labor indicators include the annual labor force growth, labor force participation rate, employment, and unemployment rates, in addition to the rate of those outside the scope of education, work, and training.
The NLO and the Saudi Labor Market Indices were launched in 2019 with the objective of further boosting Saudization and regulating the labor market. The NLO provides a set of services and products specialized in the labor market, based on comprehensive and accurate data that enables anticipating the future of the labor market, evaluating policies and programs and measuring their impact.
According to Saudi Arabia’s Central Department of Statistics and Information, the unemployment rate in the Kingdom decreased to 5.80 percent in the second quarter of 2022 from 6 percent in the first quarter of 2022.
Saudization, officially known as the Saudi nationalization scheme, or Nitaqat, is considered a crucial step toward economic success.
Although the process of Saudization has been going on since 1985, major regulatory and economic reforms have accelerated in recent years under the Vision 2030 agenda, with the aim of increasing the participation of young Saudis in the economy, promoting non-oil sectors and improving the overall quality of life.
The Kingdom’s public sector is quickly adapting to international standards and labor market demands by digitalizing services. The ministry is using the latest business management methods to help public organizations increase the competency and productivity of workers while creating a competitive labor market that can partner with the private sector.
Last week, Saudi Arabia was ranked the best in the region and third globally for its digital government transformation by the World Bank’s GovTech Maturity Index for 2022.
The Kingdom excelled with very high performance in its digital government transformation, putting it in the group of “very developed countries,” according to the index report.
The GTMI was developed as part of the World Bank’s GovTech Initiative to measure digital government maturity in four focus areas: supporting core government systems, enhancing service delivery, mainstreaming citizen engagement, and fostering GovTech enablers.
Vision 2030 promotes Saudi women as an important part of the Kingdom’s strength. It aims to develop their talents, invest their energies, and provide them with the right opportunities to build their futures, contributing to the development of society.
Saudi women now comprise 33.6 percent of the Saudi workforce as of March 2022, according to the General Authority for Statistics. That figure is up from 17.4 percent just five years ago.
The unemployment rate of women was the lowest in 20 years as of the first quarter of 2022, falling to 20.2 percent from 22.5 percent during the fourth quarter of 2021.
Saad A. Al-Hammad, a spokesperson of the Ministry of Human Resources and Social Development, told Arab News: “The Ministry of Human Resources and Social Development has implemented policies and initiatives that support inclusivity, and diversity in the labor market through introducing various incentives to enhance the positive image of women in the workplace, and to create a supportive and inclusive environment to facilitate women’s entry into the labor market.”
Al-Hammad added that the percentage of women in senior and middle management positions rose from 28.6 percent in 2017 to 39 percent as of the first quarter of 2022.
Also adding to the employment surge is Saudi Arabia’s small and medium enterprises sector, which witnessed a growth trajectory in the first half of 2022, as the Kingdom pushes ahead with fostering entrepreneurship and stimulating investment in startups and small businesses as part of Vision 2030.
The number of registered SMEs in Saudi Arabia hit 892,063 at the close of June, registering a 25.6 percent increase from the fourth quarter of 2021, according to the General Authority for Small and Medium Enterprises.