In line with Saudi Arabia’s Vision 2030, the kingdom is striving to achieve ambitious goals across various sectors, including engineering, A key objective within this vision is the localization of 25% of engineering professions. This initiative is part of ongoing efforts to enhance local workforce participation, reduce reliance on foreign expertise, and foster sustainable economic growth.

 By investing in the development of local engineering talent, Saudi Arabia aims to build a robust and self-sufficient engineering sector that supports the nation’s broader economic and infrastructural ambitions.

Implementing a decision to nationalize 25% of engineering professions

the decision to nationalize is targeting private sector establishments with five or more employees in engineering professions, marks a significant step toward enhancing the local workforce. Announced by the Ministry of Human Resources and Social Development in collaboration with the Ministry of Municipal and Rural Affairs and Housing.

this initiative aims to create more stimulating and productive job opportunities for Saudi citizens, By focusing on diverse regions across the Kingdom, the ministries are committed to fostering a dynamic and inclusive job market that supports the national goal of economic diversification and sustainable development.

also The ministry is overseeing its implementation to ensure it aligns with labor market requirements and the specific specializations within the engineering professions.

Localization in saudi arabia

Private sector establishments stand to benefit significantly from the incentives and support programs offered by the Human Resources and Social Development system, These benefits include comprehensive assistance in recruiting and identifying suitable Saudi workers, also providing necessary training and qualifications, and ensuring employment and job retention, Furthermore, these establishments will gain priority access to all nationalization support programs within the system, as well as employment support initiatives through the Human Resources Development Fund. 

This strategic support is designed to facilitate the seamless integration of Saudi workers into the private sector, enhancing both productivity and compliance with nationalization goals.

Read More: What is Saudization? Guide to Saudization and its impact to workforce

List of localization of engineering professions in Saudi Arabia

The decision is applied to all professions classified as engineering professions according to the classification

The professional approved by the Ministry of Human Resources and Social Development and stipulated

exclusively in the following:

• Civil engineer.
•  Interior design engineer.
• City planning engineer.
•  structural engineer.
• Mechanical Engineer.
• Space engineer.

General conditions for the resettlement decision

The following details are taken into account when implementing the decision: –

Imposed ratios:

Nationalization of 20% of the total number of employees with engineering professions in the facility.

Validity of the decision and binding rates:

This decision applies to all private sector establishments operating in the market, Saudi Arabia, which employs 5 or more workers with engineering professions, In the event that engineering professions are targeted in previous or subsequent decisions for the profession Or specific professions in different proportions in line with labor market changes and needs The highest Emiratisation percentage is applied.

Professional accreditation:

Engineers are required to obtain professional accreditation from the Saudi Commission For engineers, according to what is stated in the system for practicing engineering professions, and the regulations Executive Director of the System for Practicing Engineering Professions. Other engineers are not counted Accredited within the imposed Emiratisation percentages.

Read More: How to Start a Regional Head Quarter (RHQ) in Saudi Arabia

Minimum wages in Saudi nationalization

It is required that the Saudi engineer be counted in the imposed nationalization percentage lest his wages be less.

The monthly amount registered in professional insurance is less than 7,000 Saudi riyals, and it will not be counted.

The Saudi engineer who receives a lower wage than that in terms of the rate of localization.

Mechanism for calculating Emiratisation rates

The decision does not apply to any facility that has 4 or fewer expatriate engineers.

does not conflict with other Emiratization rates that apply to the total number of employees In the facility according to the Nitaqat program.

When calculating the 20% of the total engineers in the facility, rounding is done To tens, from 0.49 and below, round to zero, and from 0.5 and above, round to .1

The example below shows the mechanism for calculating the required localization rates for engineering professions For installations

Establishment (A) has a total number of employees of 60 people

Profession	Saudi Employees	Expatriate Employees	Total Employees
Administrative Technician	1	5	6
Architect Engineer	1	4	5
Project Engineer	0	5	5
Civil Engineer	5	5	10
Receptionist	0	5	5
Safety and Occupational Health Specialist	1	4	5
Cleaner	0	23	23
Total	8	51	60

General Conditions for the Localization Decision (Nitaqat):

Total Number of Engineers:

• Saudi Engineers in the Establishment: 2
• Expatriate Engineers in the Establishment: 20
• Total Engineers in the Establishment: 22

Applying the 20% Localization Rate:

Calculation Steps	Value
Total Number of Engineers	22
Localization Rate	20%
Required Localization	22 x 20% = 4.4
Rounded to the Nearest Whole Number	4
Existing Saudi Engineers	2
Additional Saudi Engineers Needed	4 – 2 = 2

Thus, the establishment needs to employ 2 additional Saudi engineers within the grace period to achieve the required localization rate for engineering professions.

The most prominent advantages in the localization of engineering professions

Here are the most prominent features:

• Wage subsidy up to 50%.
• transportation allowance from one city to another.
• training support.
•  transportation support.
•  child care allowance.
•  to increase women’s participation.

Engineering profession saudization in saudi arabia

The Ministry provides a detailed procedural guide on its website, outlining the specifics of localization and the required percentages, It also emphasizes the importance of consulting this guide to ensure compliance with the regulations.

The Ministry is committed to supporting establishments in understanding and adhering to these guidelines, but also will enforce the law in cases of non-compliance.

Strategies for Localisation in the Saudi Economy

We will examine ten strategies for localization within the Saudi economy and analyze their importance in shaping the nation’s economic landscape:

1. Recognizing the Importance of a Skilled Local Workforce:

Saudi Arabia has prioritized investing in education and training programs to build a skilled local workforce, Through initiatives such as the Saudi Vision 2030’s Quality of Life Program and the National Transformation Program.

 the Kingdom has promoted vocational and technical education, aligned curricula with market demands, and fostered entrepreneurship, By equipping its citizens with relevant skills, Saudi Arabia aims to reduce its reliance on foreign labor and enable its workforce to contribute effectively to various economic sectors.

2. Promoting SME Growth and Entrepreneurship:

Small and Medium-sized Enterprises (SMEs) are vital for economic diversification and job creation, Recognizing this, Saudi Arabia has implemented measures to support local entrepreneurs and SMEs.

Initiatives like the Entrepreneurship Loan Guarantee Program (Kafalah) and the National Entrepreneurship Institute (Riyadah) provide funding, mentorship, and training opportunities to aspiring business owners, also By nurturing a vibrant entrepreneurial ecosystem, the Kingdom can unleash the creativity and innovation of its people, driving economic growth and prosperity.

3. Encouraging Foreign Direct Investment (FDI):

Attracting foreign direct investment is a key component of Saudi Arabia’s localization strategy, The government has introduced a series of economic reforms, including the establishment of Special Economic Zones (SEZs) and new regulations to facilitate FDI.

The Shareek program, aimed at enhancing the role of the private sector, further incentivizes foreign companies to invest in the Kingdom. By encouraging FDI, Saudi Arabia can benefit from technology transfer, job creation, and knowledge exchange, diversifying its economy and reducing dependence on oil.

4. Fostering Public-Private Partnerships (PPPs):

Public-Private Partnerships (PPPs) are essential for achieving Saudi Arabia’s localization objectives,These partnerships facilitate joint investment, knowledge sharing, and capacity building across various sectors, including infrastructure, healthcare and also education. 

By leveraging the expertise and resources of both public and private sectors, Saudi Arabia can accelerate economic growth, improve service delivery, and enhance the overall quality of life for its citizens.

5. Supporting Innovation, Technology, Renewable Energy, and Sustainability:

Innovation and technology are crucial for the success of Saudi Arabia’s localization efforts, The National Industrial Development and Logistics Program (NIDLP) serves as a foundation for the country’s economic transformation, focusing on industrial development and coordination.

 Initiatives such as the establishment of innovation hubs like the King Abdullah University of Science and Technology (KAUST) and investments in renewable energy infrastructure contribute to sustainable development.

By embracing innovation, diversifying the energy mix, and promoting renewable energy, Saudi Arabia can create green jobs, reduce energy dependence, and enhance global sustainability efforts.

6. Enhancing Local Content Requirements:

Saudi Arabia has implemented local content requirements across various sectors, including energy, construction, and manufacturing, These requirements mandate that a certain percentage of goods, services, and labor be sourced locally. 

Strengthening local content policies encourages the growth of local industries, creates job opportunities, and nurtures a competitive domestic market.

7. Strengthening Vocational Training and Skill Development:

Meeting the demands of a diversified economy requires comprehensive vocational training and skill development programs.

also Saudi Arabia can establish training programs aligned with the needs of emerging industries such as healthcare, tourism, and technology. By equipping the local workforce with specialized skills, the Kingdom can enhance productivity, attract investment, as well as reduce reliance on foreign labor.

8. Promoting Cultural and Creative Industries:

Cultural and creative industries hold significant potential for economic growth and job creation. Saudi Arabia can invest in cultural and artistic initiatives, including film production, music, fashion, and design. By fostering a vibrant creative ecosystem and supporting local talent, also the Kingdom can boost its economy and enhance its cultural identity and global reputation.

9. Encouraging Women’s Participation in the Workforce:

Increasing women’s participation in the workforce is a critical aspect of localization and economic empowerment, also Saudi Arabia has made significant strides through initiatives like the Saudi Vision 2030’s Quality of Life Program and the removal of employment restrictions on women.

 By creating an inclusive environment, providing training and mentorship programs, and ensuring equal opportunities, also the Kingdom can harness the potential of its female workforce and contribute to economic growth.

10. Encouraging Social Entrepreneurship and Corporate Social Responsibility (CSR):

Promoting social entrepreneurship and CSR initiatives can positively impact local communities and foster inclusive growth, also Saudi Arabia can encourage businesses to integrate social and environmental considerations into their operations, support social enterprises, and invest in community development projects. 

The NEOM project exemplifies this approach, focusing on sustainability, renewable energy, and innovative business practices, By embracing social entrepreneurship and CSR, Saudi Arabia is furthering its economic transformation and contributing to sustainable development.

Which engineering is high demand in Saudi Arabia?

Civil Engineers: Essential for the planning, design, and supervision of construction projects such as roads, bridges, and buildings. Mechanical Engineers: Crucial for the design, development, and maintenance of mechanical systems across various industries.

What is Saudi Arabia’s Localization Strategy?

Saudi Arabia’s localization and supply chain strategy aims to integrate supply chains more closely with the domestic economy, thereby reducing costs and enhancing sustainabilit, also This strategy unfolds within a dynamic economic landscape, characterized by the development of new economic cities and Special Economic Zones (SEZs).

Will the decision to localize professions be implemented in parallel with Nitaqat? 

Yes, the decision to localize professions applies to the targeted professions within the establishment as well as the penalties prescribed by law, regardless of the establishment’s category in Nitaqat. This means that the establishment’s category in Nitaqat does not affect the calculation of the localization percentage for engineering professions.

Will the percentage for localizing engineering professions be adjusted in the future? 

The Ministry of Human Resources and Social Development is working to reduce the unemployment rate and contribute to providing decent jobs for citizens through various initiatives. To achieve this, the Ministry periodically reviews the required localization percentages by analyzing the number of graduates and job seekers, as well as the market’s capacity to absorb them. This ensures the automatic participation of graduates in the labor market.

Does the decision apply only to job titles or also to the actual work performed by the employee?

The decision applies to both job titles and the actual work performed by the employee.

In conclusion, the drive to localize 25% of engineering professions in Saudi Arabia represents a pivotal step towards achieving the goals set forth in Vision 2030, This initiative is more than just a regulatory measure; it embodies the kingdom’s commitment to enhancing its domestic workforce, reducing reliance on foreign expertise, and fostering sustainable economic growth, also By investing in local talent and creating opportunities for Saudi engineers, the country is not only addressing current labor market needs but also building a foundation for long-term prosperity, As the engineering sector evolves, these localization efforts will play a crucial role in shaping a more resilient and self-sufficient economy, positioning Saudi Arabia as a leader in innovation and infrastructure development.