Saudi Arabia salaries: What can employees expect this year?

Salaries in Saudi Arabia are expected to increase between 2 per cent and 4 per cent this year as employers focus on benefits beyond just pay, according to industry experts.

After rising by 4 per cent in 2024, salaries will increase by 2 per cent this year, according to the recruitment firm Cooper Fitch. On average, salaries in the kingdom are 15 per cent to 20 per cent higher than in the UAE, says Trefor Murphy, founder and chief executive of Cooper Fitch.

“With the UAE being one of the highest paid places to work in the world, companies must be thinking they are already paying above that in Saudi Arabia,” he says. “Saudi Arabia is now becoming a very modern country, with opportunities for eating out, living and accommodation all improving tremendously over the past five to six years. So, companies must be thinking, 'why do we need to keep increasing salaries?'. It’s fair to say that a chief financial officer in Saudi Arabia probably gets paid more than a counterpart anywhere else in the world.”

Consulting company Mercer, meanwhile, projects that salaries across sectors in the kingdom will increase by 4 per cent in 2025, based on a survey of more than 700 companies.

Saudi Arabia has become a magnet for companies seeking to expand their businesses in the Middle East as it pursues its ambitious Vision 2030 economic diversification plan.

Global companies, from private equity to law, are establishing new offices in Riyadh to access domestic opportunities. The kingdom’s megaprojects are also fuelling a huge demand for talent. The kingdom has also made significant strides in becoming a family-friendly destination, by investing in international schools, cultural hubs and modern infrastructure.

Recruitment consultants say inflated salaries were the main pull for professionals to move to Saudi Arabia a few years ago. However, in today’s market, salary inflation is no longer the driving factor it once was.

“People may be thinking, 'since inflation is high, why are we not getting a salary increase?',” says Mr Murphy. “Inflation and salary increases have never been linked. They're two different drivers. When the cost of goods and services go up and salaries don't, we just have to tighten our belts.”

Hiring outlook

Nearly 40 per cent of organisations in Saudi Arabia are planning to increase headcount next year, according to the results of Mercer’s Total Remuneration Survey.

Professionals in sales, marketing and data analytics are high in demand but challenging to hire. Additionally, retaining professionals within data analytics, sales and marketing, and finance is proving to be challenging, says Andrew El Zein, UAE career products leader at Mercer.

Nevin Lewis, chief executive and principal consultant of Black & Grey HR, says the hiring outlook in Saudi Arabia is “even more forward-leaning” than the UAE due to Vision 2030. “New and existing talent are seeing salary increments that mirror Dubai’s range – around 4 per cent to 6 per cent – but here it’s often driven by massive transformational projects and the country’s diversification agenda,” he says.

“We’ve worked with companies setting up in Saudi’s emerging sectors – renewable energy, tourism, entertainment, logistics – and they’re ready to pay more to secure the specialised expertise they need.” Mr Lewis says the salaries being offered are not just “hype”. Companies are actively competing for professionals who can help them shift away from traditional oil and gas dependency.

Talent availability will be a key challenge for employers in Saudi Arabia over the coming 12 months, Cooper Fitch says in its 2025 Saudi Arabia Salary Guide. Recruitment from international source markets will remain a key part of corporate hiring strategies in the coming 12 months.

Which industries will offer wage hikes?

Almost half (46 per cent) of organisations in the kingdom raised salaries in 2024, with 8.5 per cent increasing wages by more than 10 per cent, according to the Cooper Fitch report.

Those working in life sciences and tech are expected to receive a 4.2 per cent wage increase this year, while professionals in the energy industry may be offered a 4.3 per cent salary hike, according to Mercer data. Cooper Fitch projects that salaries in marketing, advertising and public relations could increase by more than 10 per cent in 2025.

“Wages in logistics, transportation, supply chain, and also the energy, utilities and renewable sectors could rise by above 10 per cent next year. There's a huge amount of movement in the green energy sector,” according to Mr Murphy. “While government and public sector, aviation, defence and aerospace sectors will receive a 5 per cent salary increase in 2025, heavy engineering and manufacturing companies, and hospitality, travel and tourism professionals will see their wages increase between zero and 5 per cent.”

Can employees expect a bonus?

Dynamic sectors like tech and financial services could offer one to two months’ salary incentives, similar to the UAE, Mr Lewis estimates.

Sectors that are most likely to pay bonuses in 2025 are those which have traditionally included short-term incentives (STI) as part of their overall rewards package, according to Mercer data. Typically, the value of these STIs will remain stable at about 12 per cent of the overall pay mix, Mr El Zein believes.

What other benefits can employees expect?

Cooper Fitch’s Mr Murphy says only the “very top end” executives in Saudi Arabia are entitled to “really good” remuneration packages. “You have a fixed component in your salary, a short-term or long-term incentive programme and an annual bonus. The long-term incentive would be based on performance. But that's it,” he says. "You get paid like everyone else. You don't go to Delhi or Dublin and get a house in the nicest part of those cities. So why should you get it in Riyadh?”

Consultants and senior executives are still travelling a lot between Dubai and Saudi Arabia every week, he says. “As accommodation, infrastructure, health care and education improve in Saudi Arabia, and there’s still a bit of work to be done there, I think more and more people will find themselves living in Riyadh or Jeddah to work there,” he says.

According to Mr Lewis, employers are offering training and family-friendly benefits alongside competitive pay. They now understand that to build a loyal workforce, you have to invest in people’s futures, not just their pay cheques, he adds.

Training and development in artificial intelligence is estimated to be a vital focus for employers in 2025, according to Mercer’s Global Talent Trends report.

Mr El Zein of Mercer says that, given increasing housing costs, HR professionals are also reviewing employees’ housing allowances and schooling allowance policy to remain competitive.