Saudization in private sector hits 22.3% as multiple factors contribute to growth: NLO official

National Labor Observatory (NLO) Chief Executive Director Usamah Algemili

Saudization rate in the private sector reached 22.3% by the end of the second quarter of 2023, National Labor Observatory (NLO) Chief Executive Director Usamah Algemili told Argaam. 

The wage index was recently calculated by tracking the average salary growth of active Saudi employees registered with the General Organization for Social Insurance (GOSI) from 2018 to 2023, Algemili said. He added that subscribers increased from 1.7 million in 2018 to over 2.2 million in 2023. 

The NLO noted a steady improvement in skills, jobs, productivity, and wages in Saudi Arabia over the past few years. This upward trend has been supported by government spending, Saudi Vision initiatives and projects, which is expected to continue in the years to come. 

Algemili cited several factors that have contributed to the growth of citizen wages, including economic reforms implemented under Saudi Vision 2030, the increased attractiveness of the Saudi labor market, improved labor market skills, and the rising demand for specialized jobs.

Other factors included high job quality, enhanced leadership skills among citizens, and increased demand for competencies in major projects and companies, he added.

Algemili stated that 2018 was chosen as the baseline year since it marked the beginning of a reversal in the trend and the clear impact of Vision programs on employment levels.

He noted that the index is published in the Jobs Review Report, an annual report released by the NLO. 

The data recently released by the NLO showed that the average wage of Saudis working in the private sector increased by 45% in the past five years from SAR 6,600 in 2018 to SAR 9,600 in 2023, according to data available on Argaam.