Saudi Arabia's unemployment rate drops further to 4.9% in second quarter

Figures show a continuing trend of increased work participation

The jobless rate for Saudi women again fell sharply to 15.7 per cent in the second quarter of 2023. Reuters

Saudi Arabia's unemployment rate dropped on an annual basis in the second quarter of this year, continuing a trend of increased labour participation, especially from women, government data has shown.

The overall unemployment rate, which counts Saudi citizens and expats, decreased to 4.9 per cent in the three months ended in June, from 5.8 per cent during the same period in 2022, the General Authority for Statistics (Gastat) said in its quarterly report on Thursday.

That is also a drop from the 5.1 per cent rate recorded in the first quarter of 2023.

For citizens, the rate stood at 8.3 per cent in the second quarter, a decrease from 9.7 per cent year-on-year.

The unemployment rate for Saudi women again fell sharply to 15.7 per cent, from 19.3 per cent a year ago, while for men it fell marginally to 4.6 per cent, from 4.7 per cent a year earlier.

Compared to the first quarter, the unemployment rate for women was down from 16.1 per cent, while it remained steady for men.

The increasing participation of women in Saudi Arabia's workforce is expected to boost the country’s economy by $39 billion, or 3.5 per cent, by 2032, if the current rate of growth continues, S&P Global Ratings said last week.

The kingdom has been working to diversify its economy from oil, with a number of government programmes to spur business and create jobs.

It ambitious Vision 2030 agenda plans to lower the unemployment rate to 7 per cent and boost the participation of women in the workforce.

The unemployment rate among Saudis stood at 8 per cent last year and this is projected to fall further to 7.8 per cent by the end of this year, Jadwa Investment said in an April report.

The growing economy has also boosted the labour force: the kingdom's gross domestic product topped $1 trillion for the first time last year, hitting 4.2 trillion Saudi riyals ($1.12 trillion) as the economy grew by 8.7 per cent, Gastat said.

The Arab world's biggest economy grew by 1.2 per cent in the second quarter of 2023, a slightly faster pace than initial estimates, driven by a sharp expansion in the non-oil sector of the Arab world's biggest economy, Gastat reported this month.

Business confidence in the kingdom clocked in at 56.6 in August, a slight decline from July's reading but well above the neutral 50-point mark that separates growth from contraction, the Riyad Bank purchasing managers' index showed this month.

The uplift in activity was strong overall, with companies surveyed reporting higher new orders and market growth. Surveyed firms linked a rise in sales to stronger customer demand and greater investment, it said.

Hiring at companies in Saudi Arabia's non-oil sector increased at its strongest pace in about five years in December, driven by "robust” business activity, Riyad Bank said this year.