Dubai: After rising by 4 per cent in 2024, salaries will increase by 2 per cent this year, according to the recruitment firm Cooper Fitch.

“In 2024, 79% of firms either increased or maintained salaries for new hires. Almost half (46%) of organisations raised salaries in 2024, with 8.5% increasing wages by more than 10%, highlighting the importance of talent acquisition in the kingdom at present,” analysed Cooper Fitch.   

However, despite rising demand for talent, 21% of organisations reported lowering salaries for new hires in 2024, with 3% of respondents reducing the rates of pay offered by more than 10%, it further noted in its Salary Guide Kingdom of Saudi Arabia 2025.

“Almost two-thirds (29%) of organisations have no plans to revise salaries in 2025, indicating that fiscal stability is likely to remain a key priority in Saudi Arabia during 2025.”

More than half (53%) of organisations surveyed expect to grow their workforces over the coming 12 months, compared to 57% of respondents last year. Nearly a third (31%) of the employers questioned anticipate a reduction in headcount in 2025.

“Saudi Arabia has enjoyed a strong year from the perspective of job creation, achieving growth of 7% in Q4 2024. The Kingdom’s leaders are doing all the right things, adopting a more strategic approach to financial planning and investment,” Dr Trefor Murphy Founder and CEO, Cooper Fitch.

“Consequently, Saudi Arabia’s Public Investment Fund continues to grow at a phenomenal pace. In line with this economic growth, we are reporting a 2% salary increase across the market, reflecting a positive yet steady trend in employee compensation.”

Saudi Arabia’s economy has seen a solid 12 months, with high levels of investment activity across multiple sectors. Banking, finance and insurance have been catalysts for job creation, the survey revealed.

At the same time, consumers are continuing to display a keen interest in banking products, particularly loans and card solutions, according to PwC’s KSA Banking Sentiment Index 2024. The country’s construction industry has continued to grow as well.

Analysts at Knight Frank expect the kingdom’s total construction output value to hit $181.5 billion by the end of 2028. These trends appear to have had a positive impact on remuneration in Saudi Arabia’s job market.

Nearly half (46%) of those surveyed as part of Cooper Fitch’s Salary Guide Kingdom of Saudi Arabia 2025 increased pay for new hires in 2024, and the same proportion expect to raise salaries next year.