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Saudi Arabia rolls out skill-based work permits to attract global talent

07/07/2025 03:17 AST

Expatriates seeking employment in Saudi Arabia will now be assessed under a newly introduced skill-based work permit system as the Kingdom moves to streamline its labor market and attract global talent.

The decision, issued by Minister of Human Resources and Social Development Ahmed Al-Rajhi, classifies foreign workers into three categories - high-skill, skilled, and basic - based on qualifications, experience, technical ability, wage level, and age. The system took effect for new incoming workers on July 1, while the reclassification of existing expatriates began on June 18, according to the Saudi Press Agency and a ministerial notice.

The Kingdom's demand for skilled professionals is growing amid a wave of giga-projects, including NEOM, the Red Sea Project, Qiddiya, and Diriyah Gate, which span sectors ranging from construction and design to technology and tourism. These developments require a high concentration of specialized foreign talent to meet tight delivery timelines and global standards.

The move is part of a broader strategy to enhance productivity, mitigate skill mismatches, and support Saudi Arabia's long-term economic objectives under Vision 2030.

"The measure aims to enhance worker performance, attract global talent to transfer expertise and experience to the Saudi labor market, improve operational efficiency, benefit from international experience, and build an environment that supports innovation and the development of business models," the SPA report stated.

Designed to match worker capabilities with market needs, the reform introduces a unified digital evaluation mechanism via the Qiwa platform, aligned with the Unified Saudi Classification of Professions and Educational Levels.

The new classification is expected to enhance transparency in workforce planning and help businesses access better-qualified workers while encouraging a gradual shift away from reliance on low-skilled labor.

The move comes amid improving employment indicators. The overall unemployment rate, which includes both Saudis and expatriates, fell to a record low of 2.8 percent in the first quarter of 2025, a 0.7 percentage point decrease from the previous quarter, according to the General Authority for Statistics. Among non-Saudis, the rate declined to 0.8 percent, reflecting strong private sector demand and targeted recruitment aligned with workforce needs.

Expatriates remain a critical part of the labor market, accounting for 15.7 million people, or 44.4 percent of the total population, according to GASTAT data for 2024. Among the working-age group - 15 to 64 years - 89.9 percent of non-Saudis fall within this range, underscoring their role in the Kingdom's productive sectors.

The reclassification also ties into the Professional Verification Program, launched in 2021 and expanded in 2024. The initiative, currently covering 128 countries and set to expand to 160, verifies the educational and professional credentials of foreign workers in key fields, such as engineering, healthcare, and education, before they enter the Kingdom.

Alongside labor market reforms, the government is also monitoring the financial outflows tied to foreign workers. In February alone, remittances by expatriates in Saudi Arabia totaled SR12.78 billion ($3.41 billion), according to the Saudi Central Bank, reflecting the continued economic contribution of foreign workers to the Kingdom's economy.

Employers are urged to review their workforce composition and reclassify staff through Qiwa, while workers may submit reassessment requests if they meet the criteria for higher categories, according to the ministry's guidance manual. A points-based system will ensure flexibility by allowing strengths in certain areas, such as hands-on experience, to offset limitations in formal education.

The ministry stated that the full guidance manual on the work permit classification system is available on its official website, detailing implementation steps, compliance rules, and evaluation procedures.