Other BriefingsSaudi Arabia Raises Wage Subsidies to 50 Percent for 63 Tourism-Related Jobs
Saudi Arabia has expanded its wage subsidy program to cover 50 percent of salaries for 63 tourism-related occupations. This move aims to boost Saudization and empower the national workforce for Vision 2030 reforms.
On May 25, 2025, Saudi Arabia’s Human Resources Development Fund (HADAF) and the Ministry of Tourism announced an expansion in the wage subsidy initiative aimed at nationalizing jobs in the tourism sector. The program, which now includes 63 eligible tourism-related occupations, will cover up to 50 percent of Saudi workers’ salaries in these roles, up from previous subsidy limits.
The wage subsidy initiative falls under the National Transformation Program and Tourism Human Capital Development Strategy, designed to increase the attractiveness of tourism jobs for Saudi nationals while ensuring wage competitiveness and skill development.
Scope and eligibility of the program
The subsidy applies to both full-time and part-time Saudi workers employed in approved tourism-related roles. These include positions in hotels, travel and tour services, event management, restaurants, heritage sites, and leisure activities. The Ministry of Tourism, in collaboration with HADAF, has released a detailed list of the 63 eligible professions, encompassing both operational and specialized roles such as tourist guides, reservation clerks, hotel receptionists, cultural activity coordinators, hospitality service staff, and event production specialists.
Employers across Saudi Arabia’s hospitality and tourism sectors who hire or retain Saudi employees in these roles are eligible to benefit from the subsidy scheme.
The updated subsidy covers 50 percent of the Saudi employee’s salary, subject to a monthly ceiling determined by HADAF, with additional allowances for training and development in certain roles. According to the official announcement, the program offers subsidies for up to 24 months, contingent on continued employment and compliance with Saudization targets.
This effort complements broader workforce support initiatives like:
- Tamheer program: On-the-job training for recent graduates; and
- Wusool: Subsidies for transportation costs.
Saudization in tourism: A major objective for the Kingdom
Tourism is a critical pillar of Vision 2030, with ambitions to create 1.6 million jobs by 2030 and increase the sector’s direct GDP contribution from 4.4 percent to 10 percent. Saudi Arabia surpassed 100 million tourist arrivals in 2023, with combined domestic and international tourism spending reaching US$68 billion. The Kingdom also led G20 nations in post-pandemic international arrivals growth, with a 56 percent rise compared to 2019.
In Q4 FY 2023-24 alone, tourism employment grew 4 percent year-on-year, according to the General Authority for Statistics (GASTAT). The total number of workers reached 966,531, of which 242,073 were Saudi nationals (25 percent) and 724,458 were foreign workers (75 percent).
This aligns with the government’s plan to progressively increase national participation. Starting April 2026, 41 roles, including hotel managers, travel agency directors, and tour guides, will be reserved exclusively for Saudi nationals
Tourism sector trends and hospitality outlook in Saudi Arabia
Tourism employment is also regionally diversified in Saudi Arabia. Riyadh and Makkah collectively account for nearly two-thirds of the total workforce in tourism-related activities. Riyadh alone employed 320,617, with 95,825 Saudi nationals—29.9 percent of its local tourism workforce. Makkah followed with 268,954 workers.
The sector’s physical infrastructure continues to grow. By the end of 2024, the number of licensed hospitality establishments rose to 4,425, including 2,163 hotels and 2,262 serviced apartments. Despite rapid expansion, hotel occupancy remained stable at 56 percent, compared to 60.2 percent in 2023. Meanwhile, serviced apartments saw a modest rise to 55.9 percent from 55.4 percent.
The average daily hotel rate in Q4 FY 2023-24 was US$117.29, slightly down from US$119.69 the year before. In contrast, serviced apartment rates increased 25.1 percent to US$58.65, indicating rising demand. The average guest stay remained unchanged at 3.6 nights in hotels, while serviced apartments saw a 12.1 percent drop to 2.1 nights.
Massive infrastructure investment is also fueling sector momentum. There are currently 275 hospitality projects with 67,614 rooms in the construction pipeline, with total room capacity expected to reach 500,000 by 2030. Giga-projects such as NEOM, the Red Sea Project, and AlUla are attracting global hotel chains, and 73 percent of upcoming hotel supply is tied to such developments.
The Tourism Investment Enabler Program (TIEP), launched in March 2024, further strengthens the landscape by reducing licensing time to just 5 days and waiving municipal fees. The Tourism Development Fund has disbursed over US$2 billion to support sectoral growth. Additionally, the expanded e-visa program, now covering 66 countries, facilitates easier market access for tourists and investors.
Economic and business impact of the subsidy
Tourism businesses, particularly small and medium-sized enterprises (SMEs), are expected to benefit from reduced human resource costs. This is particularly critical in the wake of post-pandemic recovery and the intensification of regional tourism competition. The wage subsidy enhances sectoral productivity by retaining skilled Saudi workers and creating a reliable domestic talent pipeline.
Private employers will need to align their human resources (HR) policies with the latest employment subsidy frameworks to maximize eligibility. Proactive workforce planning, participation in tourism training schemes, and reporting compliance are essential components for firms to access and retain the 50 percent subsidy.
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