Eurasia Press & News
Saudi Arabia’s expatriate jobs boom is fading as economic uncertainty from the Iran war deepens a hiring slowdown already underway after cutbacks at state-funded companies, recruiters have told AGBI.
Search executives said the job market has become increasingly competitive since the war began, with fewer openings, tighter salaries and an influx of candidates laid off by subsidiaries of the $1 trillion Public Investment Fund (PIF).
With big events on the horizon, recruiters say hiring is likely to pick up in the years ahead. But in recent months, growth in new expatriate jobs has slowed sharply, while demand for Saudi talent has risen as Saudisation targets mandate minimum employment quotas for locals.
“The war has exacerbated PIF cutbacks,” said Mark Butler, partner at Saudi recruitment company Sterling Bell.
The sovereign wealth fund has cut funding and curtailed hiring since the Iran war began in late February and hostilities between the kingdom and Yemen’s Houthis resumed in July, Butler said. The fund has been the driving force behind Saudi Arabia’s Vision 2030 development programme.
Major events such as Expo 2030 Riyadh and the 2034 World Cup will eventually require recruitment drives. But for the foreseeable future, Butler said, new jobs will remain hard to come by.
In part due to hiring by PIF and affiliated companies, Riyadh has created over 3 million jobs in the past five years, more than any other city in the world, according to UK-based consultancy Oxford Economics.
Businesses established to set up giga-projects, such as the entertainment city of Qiddiya and the futuristic metropolis of Neom, embarked on hiring sprees to scale up their workforces with talent from overseas.
“It was insane,” said recruitment consultant Rita El Mendri, who worked for an agency outsourced by PIF companies to fulfil mass hiring contracts. She was often given just months to find thousands of people for new PIF-led construction projects, frequently with generous incentives for hires.
“If I put somebody forward and asked for a 30 percent increase to their current salary, it was always accepted, no questions asked,” El Mendri said.
Maha (not her real name) was one of those hired during the jobs frenzy of the early 2020s. She was recruited to a newly created PIF subsidiary in 2023 on a competitive salary.
“It was a really good company with an exciting mandate aligned with Vision 2030,” said Maha. “I felt proud of what we were doing.”
In mid 2025, however, she and colleagues from Europe, Asia and the Arab world were told that the company’s budget was being cut and that most annual employment contracts, including Maha’s, would not be renewed.
It followed a PIF board meeting, first reported by AGBI, to slash funding across its companies, forcing layoffs and an unspecified number of closures.
Having already relocated to Riyadh, Maha hopes to stay in Saudi Arabia. But unlike a few years ago, she has found the job hunt arduous.
“There has been a decrease in terms of numbers of hires,” El Mendri said. “Budgets have been frozen for the past couple of months since everything kicked off in the region.”
Workers across different sectors, from marketing to construction, have reported hiring freezes amid the economic uncertainty caused by regional hostilities. Real GDP shrank by almost 5 percent year on year between April, May and June of this year, in large part due to a drop in oil production and supply chain disruptions caused by the war.
But these hiring freezes mask a longer-term trend, according to El Mendri. Companies, particularly those belonging to PIF, have begun to alter their hiring strategies, shifting away from mass recruitment in favour of a more selective approach.
“They don’t want to have large design and development teams, but rather a handful of really strong people who are more on the project management delivery side. Then they can just use consultants and third-party companies to deliver the rest,” El Mendri said.
Even as the conflict dies down and hiring resumes, she said, the jobs market will look very different from before.
For homegrown talent, however, demand remains strong. Saudisation quotas have increased steadily over the past two years.
Companies must ensure that 70 percent of specific roles – including project managers and engineers – go to Saudi nationals, who make up only 22 percent of the total registered workforce.
Rising quotas have created more competition for strong Saudi candidates, with recruiters fighting over the best ones, according to Butler. “Where are you actually going to be able to find candidates who aren’t already taken?”, he said.
Foreign-born applicants, meanwhile, have become less desirable. They face fewer jobs and slimmer salaries than before.
“The days of just bringing expensive expats from overseas have ended,” Butler said.
