A recent report projects that 70.1% of companies in Saudi Arabia are expected to increase hiring in 2024, positioning the kingdom at the forefront of the Gulf region’s employment growth. This surge is attributed to significant long-term investments in tourism and other major projects.
The report by ProCapita on the Gulf Cooperation Council (GCC) job market for 2023/2024 indicates an uptick in employment across the council’s member states, with Saudi Arabia predicted to see the highest growth this year. Additionally, the kingdom tops the list for granting the most promotions in 2023.
Employment and Workforce Dynamics
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According to the report, the employment growth rate remains positive in the region, with 66.7% of companies reporting increased staff numbers in 2023. Saudi Arabia recorded the highest growth rates, which the report attributes to entrepreneurial initiatives and private sector investments, providing a significant boost to the Saudi talent market. Meanwhile, Qatar experienced a decline in employment growth due to the wrap-up of activities related to the 2022 FIFA World Cup.
Employment Challenges
The report touches on employee turnover, citing that 64.6% of companies attribute job departures to the creation of new opportunities, with companies in the UAE leading in this aspect. Compensation and benefits ranked second at 43%, a shift from the previous year where they were the primary reason for leaving jobs.
While 43.3% of companies consider competitive compensation offered by neighboring markets a challenge due to talent drain, 39% reported a shortage of skilled professionals as another significant hurdle.
Regarding employee turnover rates, Saudi Arabia leads with an average rate of 14.1%, which the report links to large-scale projects and initiatives that encourage talent to seek and transition to better opportunities.
Promotions and Compensation
The report shows that companies recorded a 57% promotion rate, with Saudi Arabia granting the highest number of promotions. Furthermore, 77.6% of businesses provided pay increases to their employees in 2023, averaging a 6.7% raise, an increase from the 5.2% average in 2022. This is credited to a robust job market performance, especially in Saudi Arabia and the UAE.
Growth in Raises and Bonuses
The report revealed that 64% of companies offered annual raises and bonuses in 2023, up from 62.7% in 2022, with the UAE and Saudi Arabia leading the way. Additionally, 31.% of companies have implemented long-term incentive plans for their workforce, with 19.9% planning to introduce such plans, particularly in Saudi Arabia.
Looking ahead to 2024, 83.3% of companies are planning to offer raises or bonuses, with 47.6% set to implement salary and bonus increases, while 16.7% do not intend to provide such benefits.
Regarding board member remuneration, the ProCapita report noted that in 2022, the average compensation for a nine-member board amounted to $2,031,549, with Saudi Arabia ranking fourth at $155,571 per member.
Investment in Artificial Intelligence
The report also predicts that Saudi and UAE companies will lead the region in investing in artificial intelligence (AI) in 2024. Currently, only 23% of Gulf companies are investing in AI, while 52% have not ventured into this technology.
