A Saudi closed joint stock company operating under the supervision of the Saudi Arabian Capital Markets Authority, Jadwa Investment recently revealed a few updates from its latest research.
As per the findings from the report, Saudi Arabia’s construction sector was hardest hit by an outflow of expat workers during the first three months of 2018, as the Saudization wave takes a toll.
Jadwa Investment says that the largest number of foreign workers leaving the Gulf kingdom were unskilled and on low wages. Moreover the number of foreigners leaving the market in Q1 was not equally met by the number of Saudis hired, probably due to the wage gap between Saudis and expats.
This has led to an inching of up to 12.9 percent in the first three months of 2018, according to official figures from the General Authority for Statistics.
Not only that but during the first quarter of 2018 the labour market saw the implementation of expat levies, which raised expat labour costs, six months after the implementation of expat dependent fees.
A massive number of around 796,000 of foreigners in the Saudi labour market has declined since the start of 2017, with about 221,000 leaving the market during Q1, Jadwa said.
The Kingdom has also started new wave of Saudization by enforcing Saudi employment in 12 retail sectors by September.
Jadwa said: “We can say that the first wave of foreigners leaving the country are the unskilled, low-wage labour, who have been made redundant by their employer due to rising labor costs.
“Looking ahead, with around 230,000 fresh university graduates every year, the Saudi labour market is mostly challenged with creating new jobs for the educated youth,” the research note added.
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