Progress in the Saudi Labor Market

December 2025

Transforming Saudi Arabia’s Labor Market

 

Saudi Arabia is undergoing a historic transformation in its labor market, driven by Vision 2030 and a commitment to building a dynamic, inclusive, and globally competitive workforce.

This transformation is anchored in four key areas:

• Workforce expansion and economic opportunities – increasing employment for Saudis and strengthening women’s participation.
• Worker rights and fair employment – ensuring legal protections, fair contracts, and ethical recruitment.
• Occupational safety and social protection – enhancing workplace safety, health regulations, and worker welfare.
• International cooperation and labor market competitiveness – aligning labor policies with global standards and attracting top talent.

 

1. Workforce Expansion and Economic Opportunities

Saudi Arabia is implementing wide-ranging reforms and initiatives to boost employment, support national workforce development, and strengthen economic resilience.

Expanding opportunities for Saudi workers

• Since 2020, more than 2.48 million Saudis have entered the private sector, reflecting the success of labor nationalization policies.
• This success is also reflected in supervisory data, with more than 250,000 dedicated visits conducted to support localization programs in Q1 2025 alone, surpassing targets.
• The Nitaqat initiative encourages private companies to hire Saudi nationals, increasing employment across diverse industries.
• National skills programs are equipping young Saudis with the expertise needed in high-growth sectors such as technology, engineering, finance, and healthcare.
• The overall labor force participation rate reached 68.2% in Q1 2025, with Saudi participation climbing to 51.3%, both representing steady progress under Vision 2030.
• Meanwhile, the Human Resources Development Fund supported 143,000 Saudi men and women into private sector employment during Q1 2025, investing 1.83 billion SAR into training, empowerment, and guidance programs.

Empowering women in the workforce

• Female labor force participation has more than doubled, rising from 17% in 2017 to 36.3% in Q1 2025 - continuing to exceed Vision 2030 targets.
• The unemployment rate among Saudi women also dropped to a historic low of 10.5% in Q1 2025, underscoring the impact of dedicated programs and reforms to expand economic opportunity.
• These efforts are further supported by more than 3,000 establishments completing self-assessments related to workplace inclusivity, and 3,393 establishments awarded the "Mowaamah" certificate by the end of H2 2025, for providing suitable work environments for the work of people with disabilities to work.
• More than 800 training programs have delivered over 280,000 certificates, supporting more than 120,000 Saudi women into employment.
• The Wusul program has helped over 307,000 women overcome transport barriers and maintain job stability.
• Partnerships with more than 46,000 private sector companies are creating professional and leadership opportunities for women.
• The Leadership Training and Mentorship Initiative – developed in collaboration with INSEAD – has trained 1,700 women for mid- and senior-level roles in both public and private sectors.
• Flexible work options, extended maternity leave, and improved childcare services are making it easier for women to balance professional and family responsibilities.
• Structural reforms, including equal pay provisions and a unified retirement age of 65 for both men and women in the private sector, reflect the Kingdom’s commitment to workplace equality.

 

2. Worker Rights and Fair Employment

Saudi Arabia is enhancing worker protections by promoting fair treatment, transparency in employment, and effective enforcement of labor laws.

Strengthening labor protections

•  The Labor Reform Initiative, introduced in 2021, has transformed the contractual relationship between employers and workers, reducing dependency on sponsors.
• In 2024, Saudi Arabia became the first Arab country to launch a National Policy for the Elimination of Forced Labor, offering a comprehensive framework to combat all forms of forced labor.
• Meanwhile, the Wage Protection System covers all domestic workers, providing strengthened protection by ensuring wages are paid and monitored through the Musaned platform.
• By the end of 2024, it covered more than 900,000 private sector establishments, representing the vast majority of employers, and safeguarded the wages of over 8.5 million employees.
• What is more, Saudi Arabia’s strong enforcement systems ensure fair treatment and uphold worker rights. Labor inspection quality remains high, with a supervision quality rate of 93.65%, while labor courts and friendly settlement mechanisms resolve 77% of disputes before reaching litigation.

Enhancing recruitment practices and worker mobility

• The Musaned platform promotes transparent and ethical recruitment of domestic workers through licensed agencies, offering standardized contracts, wage tracking, and complaint channels.
• The Job Mobility Freedom service allows workers to change employers without needing the previous employer’s consent, removing past sponsorship restrictions.
• Employers are prohibited from withholding passports, salaries, or restricting workers' movement, ensuring workers’ autonomy and legal rights.

Labor courts and dispute resolution

• Saudi Arabia’s labor courts provide a structured and transparent process for resolving employment-related disputes.
• The Friendly Settlement process resolves 77% of complaints before they reach litigation, supporting faster and more collaborative outcomes.
• All workers, including domestic workers, have access to grievance mechanisms that reinforce accountability and fair treatment.
• Through the Preventive Justice Initiative, the wage clause in notarized employment contracts has been adopted as an enforceable document, enabling workers and employers to submit a request for enforcement in the event of non-payment of wages, without the need for additional documents. 

 

3. Occupational Safety & Health and Social Protection

Saudi Arabia has introduced comprehensive policies to improve workplace safety and health standards through its National Council for Occupational Safety and Health (NCOSH). NCOSH was established to oversee the implementation of the National Policy for Occupational Safety and Health, to govern occupational safety and health at the national level, and to define and coordinate the roles among the relevant government entities.

Workplace safety and health numbers & recent regulations

•   Saudi Arabia ranks among the safest labor markets globally, recording 230.4 injuries per 100,000 workers. Behind these numbers is a wide-ranging approach that includes new regulations, strong enforcement, and a serious investment in awareness and prevention.
• The National Council for Occupational Safety and Health has delivered 16 awareness programs, and workers' awareness of occupational safety and health risks in the labor market has risen to 71%.
• To safeguard workers from extreme summer temperatures, the Ministry of Human Resources and Social Development (HRSD) issues an annual ministerial decision prohibiting outdoor work under direct sunlight during the hottest midday hours (from 12:00 pm to 3:00 pm), typically from mid-June until mid-September.
• This decision applies nationwide and requires employers to reschedule outdoor work to cooler times of the day. The measure reflects the Kingdom’s commitment to occupational safety and health (OSH) and aligns with international best practices to reduce risks of heat stress, dehydration, and other heat-related illnesses. The Procedural Guide to Prevent the Effects of Sun Exposure and Heat Stress adopts a structured, preventive approach, including the preparation of heat stress management plans and the use of heat–humidity risk assessment matrices to assess exposure levels and determine appropriate control measures, such as work–rest schedules, shaded rest areas, hydration arrangements, acclimatization procedures, and worker awareness programs.
• By implementing this recurring ministerial decision, Saudi Arabia demonstrates a proactive approach to worker health and well-being and ensures that labor protections respond to seasonal risks as part of broader reforms to improve workplace conditions.
• Mandatory health insurance ensures that all private sector workers have access to quality healthcare.
• Saudi Arabia ranks among the safest labor markets globally, with only 230.4 injuries per 100,000 workers – a testament to its strong preventive and regulatory systems.
• Central to this progress has been the launch of key national regulations that raise standards across all sectors. The Regulation for Licensing and Accrediting OSH Practitioners and Service Providers ensures that only qualified professionals and accredited establishments are authorized to deliver consulting, training, and technical services in OSH.
• Meanwhile, the Regulation for Organizing Work in High-Risk Professions mandates certification, training, and stringent competency requirements to protect workers in hazardous occupations. 

• Complementing these measures, the Occupational Fitness and Non-Communicable Diseases Regulation has introduced mandatory medical and psychological fitness standards for the occupations, ensuring that workers are physically and mentally capable of safely performing their duties. 
  •    Together, these regulations enhance prevention, professionalize the OSH ecosystem, and align practice with international benchmarks.
   

  Saudi Arabia has also introduced comprehensive policies to improve social protections for all workers.
  
  Social protection and worker welfare

• The SANED unemployment insurance program provides temporary financial support to Saudi nationals who lose their jobs.
• Maternity leave has been extended from 10 to 12 weeks, while paternity leave provides three days of paid leave.
• Domestic workers are not responsible for repatriation costs, which are covered by employers, recruitment agencies, or the Ministry, ensuring fair treatment and financial protection.

 

4. International Cooperation and Labor Market Competitiveness

Saudi Arabia’s Commitment to International Standards and Global Talent

Saudi Arabia is committed to aligning its labor market with international standards, strengthening global partnerships, and enhancing its appeal to top global talent. This commitment is at the core of the Kingdom’s Vision 2030, which seeks to transform the economy, empower people, and position Saudi Arabia as a global hub for innovation and investment.

 

International standards and ILO engagement

• Saudi Arabia has ratified several key ILO conventions, including Convention No. 187 on Occupational Safety and Health, and is actively considering additional instruments such as Convention No. 155 on workplace safety.
• The ILO–Saudi Arabia Programme of Cooperation further strengthens regulatory frameworks, enhances enforcement, and expands protections for workers, including migrant and domestic workers.
• These reforms are ensuring that Saudi Arabia’s labor policies not only meet global benchmarks but also improve fairness, inclusivity, and safety across the workforce.

Attracting global talent and driving economic growth

• A cornerstone of this effort is the Kingdom’s long-standing partnership with the International Labour Organization (ILO). Since joining the ILO in 1976, Saudi Arabia has worked closely with the organization to advance workplace rights, improve labor standards, and build institutional capacity. In 2018, the Ministry of Human Resources and Social Development (HRSD) and the ILO launched a joint Programme of Cooperation that has provided technical assistance and capacity building to support ambitious labor market reforms. On 4 June 2025, HRSD and the ILO signed an agreement to launch Phase 3 of this programme, backed by a USD 4.1 million budget and implemented over two years.
• Phase 3 focuses on seven priority areas designed to close decent work gaps in Saudi Arabia: social dialogue, recruitment and mobility, domestic work, access to justice, social protection, labor inspection and occupational safety and health (OSH), and fair wage-setting.
• Implementation is supported by ILO experts based in Riyadh, ensuring alignment with international best practices and closer coordination with other UN agencies. This approach reflects Saudi Arabia’s determination to embed international labor standards into national practice while responding to local needs and priorities.
• Alongside these reforms, the Kingdom is investing heavily in attracting and retaining skilled professionals in engineering, technology, healthcare, and finance.
• Industry-specific talent schemes are diversifying the labor market, while reforms to recruitment and mobility make Saudi Arabia more competitive as a destination for global talent.
• Expanded investment in research, development, and innovation is creating high-value jobs, fostering entrepreneurship, and ensuring long-term sustainability. These efforts are directly tied to Vision 2030 and the Kingdom’s aspiration to create a knowledge-based economy.

 

By combining international cooperation with proactive domestic reform, Saudi Arabia is shaping a labor market that protects workers’ rights, attracts global expertise, and drives inclusive economic growth.