Saudi unemployment rate rises to 11.7% in 2014

Saudi Arabia’s unemployment rate rose slightly to 11.7 percent last year, as private companies failed to create enough jobs for a growing number of graduates entering the workforce, new figures from the ministry of planning and economy revealed.

More than 650,000 Saudis were said to be out of work in 2014, compared to 11.5 percent, a year earlier. Within this category, 56,000 were said to be “unwilling” to take on jobs below their qualifications.

Meanwhile, 5.6 million nationals made up the kingdom’s labor force last year, including 4.4 million Saudi males accounting for 79 percent, while females constituted 21 percent. Strict gender segregation rules in the workplace and the nature of available jobs in the private sector make it difficult for companies to hire women.

“Job opportunities for women are very limited in the private sector as it is today,” the report said.

To boost employment in the private sector, the government introduced a nationalization program to replace foreigners with nationals. The Nitaqat program rewards companies for meeting its Saudi employment quota.

Job creation for nationals has remained a challenge, as 70 percent of the Saudi population is under the age of 35. Most government-backed projects in the private sector are in the labor-intensive construction sector, which does not match skills acquired by Saudi graduates.

According to data, high school graduates accounted for the highest percentage of the workforce at 36 percent, followed by college graduates at 34 percent.

Figures also revealed that two-thirds of workers were between the ages of 20 and 39.

Despite a 14.18 percent growth rate for private sector employment, most Saudis chose not to take up jobs at private firms. Only 1.25 million or 25 percent worked in the private sector, compared to 3.25 million or 66 percent employed by the public sector.

Generally, many Saudis prefer the public sector because of job security, shorter working hours, and benefits.