Saudi Arabia witnessed the highest-ever unemployment rate among its citizens in the first quarter of 2018. According to a recently released report, the unemployment rate dropped in the third quarter of last year.
The rate went up to 12.9 percent in the first quarter of 2018, but decreased down to 12.8 percent in the third quarter. The spike came after the kingdom introduced a 5 percent value-added-tax (VAT), which impacted private employers.
The unemployment rate among Saudi nationals stood at 12.7 percent in the first quarter of 2017. The rate rose to 12.8 percent, which was prevalent for three quarters, before reaching 12.9 percent in the first quarter of 2018.
The newly released results also revealed that there has been a decrease in unemployment rates among Saudi women. During the third quarter of 2018, the unemployment rates dropped to 30.9 percent among Saudi women, from 31.1 percent in the second quarter of 2018.
In recent months, there have been several orders issued allowing Saudi women to work in professions and fields previously limited to men.
Just months after a royal decree granted Saudi women their right to drive, many started applying to become taxi drivers. Careem, a UAE-based taxi-hailing app that offers its services in the kingdom, also began training women for driving jobs. According to The Independent, the company had already signed up 1,000 Saudi women for positions just weeks after the driving ban was lifted.
The unemployment rate among Saudi men has also decreased to 7.5 percent from 7.6 percent in the second quarter.
"Saudization" process has seen a decrease in non-Saudi male employees
The study also revealed there has been a decrease in the number of non-Saudi male employees standing at 8,622,890, compared to 8,927,862 in the previous quarter.
In recent years, Saudi Arabia has taken major steps to make the "Saudization" process a reality, aiming to nationalize the workforce in the kingdom by reducing its reliance on foreign labor. Thus, non-Saudis have seen fewer job opportunities available to them in recent months.
The number of foreign workers declined by 6 percent in the first three months of 2018. More than 234,000 expats left the kingdom during the same period. In just 18 months, more than 800,000 expats left the country. The number exceeds an estimation in 2017 which claimed 670,000 expats would leave Saudi Arabia by 2020.
During the peak of it all, the Saudi unemployment rate reached an all-time high. However, it seems as though the effects of the "Saudization" process are just now surfacing.
In recent years, Saudi Arabia has been reducing its reliance on expats
Under Vision 2030, the kingdom has passed several orders, including one that terminates all contracts pertaining to expatriate workers in governments and ministries within three years and another that nationalizes jobs in shopping malls.
In 2017, Saudi Arabia's Minister of Labor and Social Development issued an order reducing the validity of expat work visas for private sector employees in the country from two years to one year.
In November 2017, the Ministry of Labor and Development arrested a number of expats caught working in nationalized sectors. It also warned violators of deportation.
According to the Saudi Gazette, authorities have apprehended 1.35 million expats in the past eight months. Vision 2030 also aims to develop non-oil-related industries, support small and medium enterprises, increase the participation of Saudi women in the workforce, and create a broader investment base in the country.