According to the latest purchasing managers index (PMI) from Riyadh Bank, Saudi Arabia’s private sector has been experiencing the fastest speed of employment generation since May 2011. Keeping strong work is given fuel by increasing demand and economic optimism, but it also comes with increasing wages and input costs, which pressurize the overall pricing.
Job market gets hot, but costs costs
According to June PMI report:
- New jobs in non-board areas increased at the fastest rate in 14 years
- This hiring boom led the record increase in the cost of wages, which contributed significantly to the overall cost pressures
The report said, “This increase in demand of employees contributed to record increase in the cost of wages … and the prices of production renewed.” Connecting inflation, the cost of input purchases also increased at the fastest rate since February 2025, which is inspired by geo -political risk and strong demand.
Travel and aviation bounce in job
A major contributor in the wave of this work is a trip to Saudi Arabia and the tourism sector, especially with the much -awaited launch of Riyadh Air.
- Aviation-faceing businesses are actively expanding their teams
- Hiring Consultants Note increased recruitment in airlines, airports and hospitality services
This activity reflects the widespread vision of the state to develop a variety away from oil and develop a prosperous tourism and service economy.
June PMI rises to 57.2: Indication of expansion of development
Saudi Arabia’s non-oil PMI increased to 57.2 in June, above 55.8 in May. A reading above 50 indicates commercial expansion. Major drivers of PMI growth include:
- High output level
- Growing demand and new project launch
- An active labor market
“Firms added pickups to activity to improve sales to a large extent, the new project begins, and better demanding position to improve sales.” Although output growth was slightly soft than earlier heights, the speed in hiring and project activity is stronger.
Business confidence hits two years high
Despite the rising cost, the Saudi is excited in the private sector.“Faith about future activity climbed on a two-year peak,” said Riyadh Bank’s Chief Economist Nife al-Gath in a public statement. “Employees’ costs increased at a record speed as the firms worked to maintain talent … while the purchase prices have seen their fastest growth since February.” Has been lined by a positive attitude:
- Healthy order pipeline
- Strong domestic demand
- Continuous project declaration and expansion plans
