Saudi's economy engulfed by unemployment in second quartertext_fields
Riyadh: Saudi Arabia's economy is witnessing another quarter of highest recorded unemployment rate as the pandemic took a toll on all sectors globally. According to the data produced by the General Authority for Statistics (GaStat), the unemployment rate increased to 15.4 percent while the Labor Force Participation rate of Saudi increased to 48.8 percent in the second quarter of this year.
The total Labor Force Participation rate showed 59.4% in second quarter of this year. The unemployment rate, referred as percentage of unemployed workers in the total labor force, escalated from 11.8 percent in first quarter (Q1) to 15.4 percent in the second quarter (Q2). The Kingdom's youth constitute the highest proportion of the unemployed, with citizens between the ages of 20-29 making up 63.1 percent.
GaStat data displayed a decline of expatriates by 19 thousand on a net basis in the labor market in Q2. It also showed a fall in the number of issued work visas for expatriates in private sector, summed to 32 thousand and 34 thousand in Q2 and Q1, respectively. Due to travel restrictions imposed during the quarter, 97 percent of issued visas were said to be unused, while the remaining 3 percent were cancelled.
The population of the country accounts for 33 million inhabitants approximately. Out of the total population, majority of employed workforce are mainly reliant in the oil and gas industry as the economy itself is dependent on this sector.
Major economic challenges faced by the country includes tackling of environmental impacts on oil and natural gas production. Aramco, a state funded company, has been deemed to be one of the topmost global polluters.
The country expects a gradual improvement in Saudi unemployment rate during the second half of 2020 thanks to initiatives by the Human Resources Development Fund (HRDF) and the Ministry of Human Resources and Social Development (MHRSD).