Saudi Unemployment Drop Boosts Consumer Spending by 9.5%, Jadwa Investment Says

Saudi Arabia’s economy continued to generate a significant number of jobs in the first quarter of 2025, as companies hired more workers to meet rising demand, according to a report by Jadwa Investment.

These labor market gains, including among Saudi youth, supported consumer spending and pushed the unemployment rate among Saudis to a record low of 6.3% in the first quarter of this year, down from 7% at the end of Q1 2024. This occurred as the number of Saudis employed in the private sector rose 4.3% year-on-year to 2.4 million workers from the beginning of the year through May.

Consumer spending, encompassing point-of-sale operations, e-commerce, and ATM cash withdrawals, grew 9.5% year-on-year in nominal terms. While overall consumer spending continued its strong growth, consumer companies are facing intense competition.

For the remainder of 2025, Jadwa anticipates continued growth in consumer spending, although the pace of growth is likely to moderate compared to the robust performance in the first quarter.

The report also projected good momentum in the tourism sector, with a significant number of hotels scheduled to open across the Kingdom, including in Makkah, Madinah, Riyadh, NEOM, and the Red Sea. Additionally, a variety of sports and entertainment events across the Kingdom are expected to provide a strong boost to the hospitality sector.

Meanwhile, the transport, storage, and communications sector grew robustly in the first quarter, recording a 6% year-on-year increase, up from 4.9% growth in 2024. This performance was driven by several factors, including growth in freight transport and a record-high number of railway passengers, with 35 million passengers transported across the Kingdom’s railway network.