Expanding female workforce participation could boost Saudi economy: S&P

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The increasing participation of women in Saudi Arabia's workforce is expected to boost the country’s economic growth prospects, according to S&P Global Ratings.

Labor market reforms led female workforce participation for Saudi nationals to nearly double to almost 36% in 2022, compared with 19% in 2016.

This boosted the overall participation rate to a record high of 61.7 per cent in March 2023, compared with a record low of 54.2 per cent in June 2017.

According to the rating agency, if the current pace of labor force participation growth continues for the next decade, the Saudi economy could potentially reach $39 billion, larger by 3.5%. This was in comparison with a hypothetical scenario with historical labor force participation rate growth recorded during 2000-2022.

“We calculate that increases in the overall participation rate of just 1 percentage point per year over the next 10 years would boost the country’s annual real GDP (gross domestic product) growth by an average of 0.3 ppt, to 2.4 percent per annum (versus 2.1%), assuming that labor force productivity growth for the next 10 years will look the same as the last 20 years,” S&P said.