Business boom leads to strongest job growth in Saudi Arabia in 5 years

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Saudi Arabia saw its strongest job growth in almost five years at the end of last year, according to a survey of purchasing managers compiled by S&P Global and published on Tuesday. The survey found that companies in the country sought to add to their staffing capacity in response to an increase in sales and higher demand. The non-oil private sector, which is the engine of job creation for the world’s top crude exporter, has remained strong despite rising costs and the threat of a global slowdown.

“We see operating conditions remaining favorable in December, characterized by rapid growth in the non-oil activities and a robust labor market by the end of 2022, with both jobs and wages having far more momentum than previously thought,” said Naif Al-Ghaith, Chief Economist at Riyad Bank.

The Riyad Bank Saudi PMI,stood at 56.9 in December, significantly higher than the 50-mark that separates growth from contraction. In November, the gauge reached 58.5, the highest reading in more than seven years. The strength of the economic momentum in Saudi Arabia has been largely immune to the pandemic, with prices charged by companies increasing at the fastest rate in nine months in December as firms passed on increased expenses to clients.

“The increase in interest rates has been offset by the rapid growth,” Al-Ghaith said. “This significant growth pushed prices even further in the service sector, pointing to an inflationary pressure caused by the demand side.”