Saudi Arabia's jobless rate dips to three-year low

The unemployment rate among Saudi citizens dropped to its lowest levels in more than three years as the kingdom's non-oil growth picked up this year, official government data showed.

The jobless rate in Saudi Arabia fell to 12 per cent in the third quarter, down from 12.3 per cent in the previous quarter, and below a record high of 12.9 per cent in 2018, according to data released by the General Statistics Authority on Sunday.

Overall unemployment among all residents in Saudi Arabia fell slightly to 5.5 per cent in the third quarter from 5.6 per cent in the previous three months, the government agency said. This ranks the kingdom as number 11 among G20 countries in terms of unemployment levels.

Saudi Arabia is implementing a number of measures as part of its economic diversification plans under the Vision 2030 initiative that aims to create more jobs for citizens by developing non-oil industries and attracting them to the expatriate-dominated private sector. The move is part of a wider economic overhaul to reduce the country's reliance on oil and diversify sources of income. The government has introduced policies that oblige or encourage companies to hire locals and impose higher fees on employing foreigners.

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Unemployment dropped for both men and women, with more citizens working in private as well as government sector.

Economic participation among Saudi nationals rose to 45.5 per cent in the third quarter, compared to 40 per cent in the previous quarter, the report said. Participation of Saudi working women remained constant at 23.2 per cent.

Jobless rates among Saudi men grew 5.8 per cent quarter-on-quarter and 30.8 per cent among Saudi women, according to the data.

More Saudi women are seeking jobs after the kingdom has lifted social restrictions including a ban on them driving, to encourage more female economic participation.

Saudi Arabia’s economy is forecast to expand 2.3 per cent in 2020, after a projected 0.4 per cent growth this year, propelled by non-oil growth, according to government estimates.

Non-oil revenue is projected to grow to 320 billion riyals next year, up from 315bn riyals this year, according to the government’s budget announcement.

The kingdom will continue to invest in developing non-oil sectors including tourism, entertainment, manufacturing and construction, in line with the Vision 2030 plan.

Saudi Arabia's Purchasing Manager's Index, a composite gauge reflecting the health of the non-oil economy, rose to 58.6 in November – the highest in four years. Point of sale transactions, a proxy for retail sales, also continues to expand.

Oil revenue is expected to fall to 513bn riyals in 2020, from an estimated 602bn riyals in 2019, according to government.

The projection comes amid lower Saudi oil production due to its compliance with Opec+ production cuts.

Opec and its allies agreed to deepen crude output cuts by 500,000 barrels per day until March 2020.