Experts to "Al Arabiya.net": Job Quality Will Lead the Next Phase in the Saudi Labor Market

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The Saudi labor market is heading towards a new phase where the focus on the quality of jobs, their sustainability, and the alignment of skills with the needs of the economy is increasing, following the improvement recorded in unemployment indicators among Saudis over the past years, according to economic specialists who spoke to "Al Arabiya.net."

The General Authority for Statistics revealed that the unemployment rate among Saudis reached 6.5% during the second quarter of this year, compared to 6.4% in the first quarter, while it was 6.8% in the same quarter of last year.

The specialists believe that legislative and regulatory reforms, localization programs, the increased participation of women in the labor market, along with the expansion of non-oil activities and investments in new sectors, have contributed to the improvement seen in labor market indicators.

Economic analyst Dr. Ali Al-Hazmi told "Al Arabiya.net" that a number of factors contributed to the decline in Saudi unemployment, foremost among them the legislative and regulatory reforms that enhanced labor market flexibility and expanded employment opportunities since the launch of Saudi Vision 2030.

He added that "qualitative localization" has played an important role by introducing new professions and sectors within localization decisions, such as pharmacy, engineering, dentistry, and some marketing professions, which has enhanced the entry of Saudis into specialized jobs.

Al-Hazmi pointed out that the increase in Saudi women's participation in the labor market has been one of the most significant transformations, emphasizing that the most important impact is not limited to increased participation, but rather in "the economy's ability to absorb new entrants into productive and sustainable jobs."

The expansion of non-oil activities and investments in new sectors has also contributed to creating more opportunities, alongside the role of the Public Investment Fund in establishing companies and developing promising economic sectors.

Al-Hazmi believes that achieving the target of reducing Saudi unemployment to 7% ahead of schedule has opened the door to a more ambitious target of reaching 5% by 2030.

He added that the upcoming phase is likely to witness a greater focus on the quality of jobs and their sustainability, as well as aligning skills with the needs of the economy, alongside continuing to improve labor market performance.

In this regard, economic expert Dr. Mohammed Al-Qahtani told "Al Arabiya.net" that the decrease in unemployment among Saudis should not be interpreted as a result of a single policy, but rather as a reflection of a broader structural transformation in the economy and the labor market.

He explained that the growth of non-oil activities, the expansion of the private sector, the emergence of new economic sectors, along with localization, women's empowerment, labor market reforms, and training and rehabilitation programs, have collectively contributed to expanding the opportunities available to Saudis.

He pointed out that the unemployment rate among Saudis reached 6.5% in the second quarter, compared to 6.8% in the same period last year, which are levels that differ significantly from rates that exceeded 12% nearly a decade ago.

Al-Qahtani confirmed that reducing unemployment and improving job quality are two complementary goals, but the concept of job quality will be more prominent in the upcoming phase.

He said that the question in a previous stage revolved around how to create more jobs for Saudis, while discussions today are shifting towards the quality of the job, its productivity, wage levels, and its ability to provide a viable career path for growth.

He added: "We are gradually moving from the stage of creating and localizing jobs to the stage of enhancing the value and productivity of jobs."

Al-Qahtani called for studying the establishment of a "national index for job quality" that would complement traditional indicators related to unemployment, participation, and employment.

He explained that the proposed index should not be limited to salaries, but should also include the level of real wages, job stability, social benefits and protections, training and development opportunities, career paths and promotions, the extent to which the job matches the employee's qualifications and skills, and productivity levels.

He also suggested that the index should measure the ability of jobs to sustain themselves amid rapid technological transformations, artificial intelligence, and automation.

Al-Qahtani believes that such an index could provide decision-makers, the private sector, and researchers with a deeper understanding of the labor market, as the unemployment rate reveals the number of job seekers, but does not alone provide a comprehensive picture of the quality of jobs held by workers.

Al-Qahtani confirmed that the next phase requires enhancing the transition from 'quantitative localization' to 'qualitative localization', so that the measure is not just the number of Saudis employed, but also the quality of jobs, wage levels, productivity, training, stability, and opportunities for professional advancement.

He emphasized the importance of continuing to align educational and training outputs with the needs of the new economy, especially in artificial intelligence, advanced technologies, industry, financial and logistical services, energy, tourism, and the digital economy.