Saudi Arabia’s labour market is undergoing a dramatic transformation as part of “Vision 2030,” the Kingdom’s ambitious economic diversification plan launched in 2016. A core goal of “Vision 2030” was to reduce unemployment and reliance on expatriate labour.
At the plan’s outset, foreign workers held roughly 80% of private-sector jobs, reflecting decades of dependence on expatriate labour. Vision 2030 set a target to lower Saudi unemployment to 7% by 2030, pushing companies to hire more Saudi nationals (a policy known as Saudization).
How Kingdom Is Reforming Labour
To achieve these goals, Saudi Arabia introduced Saudization quotas (notably via the Nitaqat programme) requiring businesses to employ minimum proportions of Saudi citizens. Firms meeting high Saudi employment quotas receive incentives, while those that fall short face penalties in hiring foreign workers.
The government also imposed expatriate levies to encourage hiring locals. In parallel, major labour law reforms have been enacted. In 2021, the “Labour Reform Initiative” effectively dismantled the longtime kafala (sponsorship) system, giving expatriate workers greater freedom to change jobs and travel without employer consent.
These changes increased labour mobility and aligned the Kingdom’s practices closer with international standards. “Vision 2030” also emphasises women’s economic inclusion, introducing equal pay laws and expanded maternity leave, alongside programmes for childcare (Qurrah) and transport (Wusool) to support women in work. These policies have opened new opportunities for Saudi women and youth, creating a more dynamic and inclusive job market.
The Metamorphosis Of Arabian Labour
By 2030, Saudi Arabia’s labour reforms are yielding record-breaking results. Unemployment among Saudi nationals has plummeted to around 7%, achieving the original 7% target five years early. Buoyed by this success, officials revised the goal even lower by aiming for 5% unemployment by 2030.
Overall unemployment (including expatriates) fell to just 2.8% in early 2025, the lowest level on record. Crucially, female workforce participation has more than doubled, soaring from under 20% in 2018 to about 36% by 2025.
This already surpasses Vision 2030’s female participation target (30%) ahead of schedule. Saudi women today are increasingly visible in sectors from finance to technology, backed by reforms that outlaw workplace discrimination and encourage female leadership.
Youth unemployment, once alarmingly high, has been cut nearly in half since 2017. More Saudis are employed in the private sector than ever before as national employment in private companies rose by 12% in 2024 alone, as businesses adjusted to the new policies and invested in local talent. High-skill jobs are expanding as the economy diversifies beyond oil, with rising demand (and salaries) for Saudi workers in tech, finance, healthcare and other growth industries.
Meanwhile, training and education initiatives under “Vision 2030,” like the Human Capability Development Programme and Tamheer internships, are equipping hundreds of thousands of young Saudis with skills for the modern job market.
Things To Keep An Eye On
Despite rapid progress, challenges remain on the road to 2030. Employers must continue to build skills and experience in the Saudi workforce to meet private sector needs, especially in advanced fields. The transition away from an expatriate-dependent labour model requires balancing Saudization with attracting specialised foreign talent.
The government’s updated target, which is 5% unemployment by 2030, reflects a shift toward sustainable, high-quality job creation rather than simply hitting numeric goals. Achieving this will entail focusing on productivity and entrepreneurship, not just public-sector hiring. Moreover, ensuring that the gains are inclusive (across genders, regions, and youth) is key to long-term success.
Overall, Saudi Arabia’s labour market reforms under “Vision 2030” have already reshaped the employment landscape. Unemployment is at historic lows, and more Saudis are participating in the economy than ever.
Through a combination of bold policies and economic momentum, the Kingdom is well on its way to realising Vision 2030’s promise of a thriving, inclusive job market driven by Saudi talent. The transformation, while ongoing, demonstrates how targeted reforms can unlock human potential and create an empowered workforce for a post-oil future.