Labour Market Improves in 2026 as Unemployment Falls Since Late 2025

The unemployment rate and shifts in labour force participation show how quickly the Saudi labour market is evolving. Mixed data from the fourth quarter of 2025 revealed both new chances and challenges for investors and job seekers in the country’s economy.

This data shows the pulse of the Kingdom’s labour market and emphasises the necessity of bolstering laws that promote citizen employment and foster long-term labour market expansion.

Saudi Arabia’s Jobless Rate Rises

The overall unemployment rate (for Saudis and non-Saudis) was 3.5% in the fourth quarter of 2025, according to the Saudi General Authority for Statistics. This represents a 0.1 percentage point increase from the third quarter of the same year, but it remained steady at 3.5 percentage points year over year from the fourth quarter of 2024.

In the fourth quarter of 2025, the unemployment rate for Saudis alone was 7.2%, down 0.3 percentage points from the third quarter of that year and up 0.2 percentage points from the fourth quarter of 2024.

The Saudi labour force participation rate increased to 49.5% in the fourth quarter of 2025, up 0.5 percentage points from the third quarter of the same year, but decreased 1.6 percentage points year-on-year compared to the fourth quarter of 2024.

These findings demonstrate the continued difficulties the Saudi labour market faces, as the country’s unemployment rate is still greater among Saudis than it is nationwide. This calls for additional efforts to improve job prospects and develop skills in accordance with the needs of the contemporary market.

At the same time, the growth in the Saudi labour force participation rate represents a significant improvement, demonstrating favourable trends toward growing Saudi engagement across many economic sectors. However, the year-on-year drop emphasises the necessity to monitor the driving factors and investigate measures to sustainably increase involvement.

Strong Uptick in Participation & Employment

According to estimates from the Labour Force Survey released by the General Authority for Statistics, the overall labour force participation rate, which includes both Saudis and non-Saudis, reached 67.4% in the fourth quarter of 2025. This represents a 0.5 percentage point increase from the third quarter of the same year and a 1.0 percentage point increase from the fourth quarter of 2024.

Despite a 1.6 percentage point decline from the fourth quarter of 2024, the data also revealed an improvement in the employment rate of Saudis relative to the population, reaching 45.9%, a 0.6 percentage point rise from the third quarter of 2025.

These numbers show a slow increase in Saudis’ labour market involvement, but the yearly reduction calls for ongoing efforts to boost employment possibilities and skill development to meet the changing demands of the country’s economy.

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Labour Market Indicators for Q4 2025

Saudi Arabia’s labour market data for the fourth quarter of 2025 highlights notable improvements in women’s participation and employment, alongside mixed trends for men. Saudi women’s labour force participation rose by 0.8 percentage points to 34.5%, while their employment rate increased by 1.3 percentage points to 31.0%. Their unemployment rate saw a significant decline of 1.8 percentage points, reaching 10.3%. Among Saudi men, the employment rate remained steady at 61.1%, though labour force participation increased slightly to 64.7%. However, their unemployment rate rose to 5.6%.

Youth labour indicators showed varied outcomes. For young Saudi women aged 15–24, the employment-to-population ratio increased to 13.5%, while participation dipped slightly to 17.4%. Their unemployment rate fell by 1.8 percentage points to 22.4%. Young Saudi men in the same age group experienced small gains in employment and participation, rising to 28.0% and 32.9%, respectively, but their unemployment rate increased to 15.0%.

For Saudis of prime working age (25–54), employment rose to 63.6%, participation increased to 67.5%, and unemployment declined to 5.8%. Saudis aged 55 and above also recorded higher employment and participation, accompanied by lower unemployment.

The data further reveals active job‑seeking behaviour among unemployed Saudis, who used an average of four methods. The most common techniques included applying directly to employers, updating resumes on professional networking platforms, and using the national employment portal, Jadarat. A large majority—95.9%—expressed willingness to work in the private sector. Additionally, many Saudis showed flexibility regarding work conditions: nearly half of men and almost two‑thirds of women were open to commuting for an hour, while most men and a significant share of women were willing to work eight hours or more per day.

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These Indicators’ Effect on the Saudi Market

These data show that women’s and young people’s participation in the Saudi labour market is gradually improving, which benefits workforce diversity and supports the Kingdom’s Vision 2030 goals to raise citizen participation in the market.

However, the high unemployment rate among certain groups—especially young men—indicates the necessity of creating training and qualification programmes that adapt to the market’s constantly shifting demands.

Furthermore, the strong trend toward working in the private sector and the variety of job search strategies attest to a strong desire to avoid unemployment, which necessitates creating an engaging and appealing workplace that offers long-term career opportunities and can effectively accommodate this large number of job seekers.

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