Saudi Arabia has introduced new workforce localization measures under its Saudization policy, marking another significant step toward strengthening employment opportunities for Saudi nationals. One of the most notable changes is the introduction of a minimum monthly salary of SAR 8,000 for Saudi engineers, alongside increased localization targets in the engineering sector. These reforms are aligned with the Kingdom’s long-term economic vision and aim to create sustainable, high-quality jobs for citizens while supporting private-sector growth.
UNDERSTANDING SAUDIZATION AND ITS PURPOSE
Saudization is a national labor strategy implemented by Saudi Arabia to increase the participation of Saudi citizens in the private sector. Historically, many technical and professional roles in the Kingdom were filled by expatriate workers. While this supported rapid development, it also created a reliance on foreign labor.
Through Saudization, the government requires companies to employ a defined percentage of Saudi nationals based on their industry and workforce size. The policy focuses on developing local talent, reducing unemployment among citizens, and ensuring that economic growth directly benefits the Saudi population.
These updated regulations reflect a shift toward quality employment, ensuring that jobs offered to Saudi professionals are financially viable, skill-based, and aligned with national development goals.
KEY HIGHLIGHTS OF THE NEW ENGINEERING REGULATIONS
The latest update places strong emphasis on engineering professions, which are critical to Saudi Arabia’s infrastructure, energy, construction, and industrial sectors.
Major Changes Include:
Minimum Salary Requirement: Saudi engineers must earn at least SAR 8,000 per month to be counted under Saudization quotas.
Localization Target: Companies are required to ensure that 30% of engineering roles are filled by Saudi nationals.
Company Coverage: The rules apply to private and non-profit organizations employing five or more engineers.
Professional Accreditation: Engineers must be officially registered with the Saudi Council of Engineers, ensuring professional competence and recognized qualifications.
Implementation Timeline: While announced at the end of 2025, companies have been given a six-month adjustment period before full enforcement begins.
The policy covers dozens of engineering disciplines, including civil, electrical, mechanical, industrial, architectural, marine, and electronics engineering.
WHY THE SAR 8,000 SALARY BENCHMARK IS IMPORTANT
Setting a minimum salary threshold serves several strategic purposes:
1. Financial Stability for Professionals
SAR 8,000 per month provides Saudi engineers with a stable income that reflects their education and technical expertise. This helps make engineering careers more attractive to young Saudis entering the workforce.
2. Preventing Token Employment
The salary requirement discourages superficial compliance, where companies might otherwise hire nationals at very low wages simply to meet quotas. Instead, it promotes meaningful and fair employment.
3. Encouraging Skill Development
By linking employment to professional accreditation, the policy incentivizes engineers to maintain certifications, enhance skills, and pursue continuous professional development.
Overall, the wage requirement raises employment standards while protecting the dignity and value of skilled labor.
IMPACT ON THE PRIVATE SECTOR
Private-sector companies will need to review their workforce planning strategies to comply with the updated Saudization rules. This includes:
Revising salary structures
Recruiting qualified Saudi engineers
Investing in training and onboarding programs
Aligning job descriptions with professional standards
While this may increase short-term operational costs for some employers, policymakers emphasize that a skilled local workforce can reduce long-term expenses related to turnover, recruitment, and dependency on overseas talent.
The government’s phased implementation approach allows businesses time to adapt without disrupting ongoing projects.
BROADER EXPANSION OF SAUDIZATION POLICIES
The engineering sector is not the only area affected by recent localization efforts. Saudi Arabia has gradually expanded Saudization targets across multiple industries, including:
Procurement and supply chain roles
Accounting and finance professions
Healthcare services
Retail and customer service sectors
In some professions, localization targets now reach 60% to 70%, reflecting the government’s confidence in the growing capabilities of the national workforce.
This structured expansion demonstrates a balanced approach—strengthening local employment while maintaining business continuity.
ECONOMIC AND SOCIAL BENEFITS
1. Reduced Unemployment
By prioritizing Saudi nationals in skilled professions, the policy directly contributes to lowering unemployment rates among graduates and technical professionals.
2. Stronger Human Capital
Investing in local talent helps build long-term expertise within the country, supporting innovation and productivity across industries.
3. Sustainable Economic Growth
A stable, skilled workforce supports economic diversification and reduces dependence on external labor markets.
4. Alignment WITH VISION 2030
The reforms are closely aligned with Saudi Arabia’s Vision 2030 objectives, which emphasize workforce localization, private-sector empowerment, and sustainable development.
CHALLENGES AND ADJUSTMENTS
Despite its advantages, the policy may pose challenges for some employers, particularly those accustomed to relying heavily on expatriate engineers. Finding qualified local talent, adjusting compensation frameworks, and meeting compliance requirements may require strategic planning.
However, government officials view these challenges as transitional and necessary for long-term economic resilience. Support initiatives, training programs, and partnerships with educational institutions are expected to play a key role in easing the transition.
FUTURE OUTLOOK
Saudi Arabia’s updated Saudization rules signal a clear commitment to building a skilled, well-paid national workforce. The SAR 8,000 minimum salary for engineers sets a new benchmark for professional employment and reflects a shift toward quality-focused localization.
As enforcement begins, the policy is expected to reshape hiring practices, encourage skill development, and enhance the role of Saudi professionals in key sectors. Over time, these reforms are likely to strengthen both the labor market and the broader economy.
By balancing workforce localization with professional standards and fair compensation, Saudi Arabia continues to move steadily toward a more inclusive and sustainable economic future.
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