In the wake of Vision 2030, Saudi Arabia’s higher education system is experiencing a significant transformation to better meet the demands of the job market, according to a recent analysis by Colliers. The report from the global professional services firm indicates that the Kingdom’s ambitious economic diversification and Saudization initiatives are reshaping employment opportunities, particularly in sectors like artificial intelligence, robotics, nuclear energy, and renewable energy.
Mansoor Ahmed, a Colliers executive, points out that there is a growing need for specialized research and development studies, reflecting the evolving dynamics of the market. He suggests that the current higher education offerings must pivot to address the disconnect between academic degrees, skill sets, and the actual needs of employers.
Colliers anticipates a surge in tourism-related jobs as a result of Saudi Arabia’s substantial investment in the sector and regulatory reforms aimed at increasing tourist arrivals. Moreover, the establishment of a Social Development Bank with a funding of SR22 billion to support over 70,000 small enterprises by 2030 is expected to foster entrepreneurial activity in the nation.
The company envisions a demand for sub-specialties over traditional degree programs in these burgeoning sectors.
Current landscape indicators
Colliers’ report indicates that, as of 2022, there were around 3.3 million Saudis aged 18 to 24, with 2 million enrolled in higher education. A staggering 95 percent attended public institutions, which are free and reputed to offer superior quality programs. Notably, graduates from these public universities have a higher likelihood of securing employment post-graduation.
However, there is a misalignment in enrollment, with many students pursuing degrees in humanities, Islamic studies, and behavioral sciences, which do not correspond with the demand in the job market. The report also highlights that female student enrollment is higher overall, but male students predominate in technical, vocational, and military education.
To align with the Kingdom’s economic transformation and close the education-to-employment gap, a shift towards emerging fields such as renewable energy, tourism, and hospitality is essential.
Increased tourism demand
The Gulf region’s hospitality industry has expanded significantly over the last decade. Saudi Arabia aims to welcome 130 million tourists annually by 2030. Colliers estimates a current inventory of around 640,000 hotel rooms in the Kingdom, with about 500,000 employees in the sector. With major developments in the Red Sea, Al-Ula, and NEOM, as well as Riyadh’s emergence as a regional center, an additional 200,000 rooms and over 230,000 new jobs in hospitality and tourism are expected by 2030.
Despite this growth, the sector predominantly employs expatriates, especially in technical roles, signaling an urgent need to develop local talent in hospitality. The Saudi government has mandated that at least 30 percent of hospitality staff be Saudi nationals, with all front desk and managerial positions reserved for citizens.
To meet the demand, the Ministry of Education and Technical and Vocational Training Corp. has initiated the establishment of dedicated hospitality academies and the introduction of tourism-related programs at public universities. Yet, enrollment in these programs remains low, with just 0.3 percent of higher education students enrolled in tourism and hospitality-related courses.
Although there is an eagerness among Saudis to pursue careers in hospitality, the industry faces challenges in perception, as technical roles are often viewed as socially inferior. Overcoming this stigma is essential to make careers in this sector more appealing.
Opportunities for growth
The public sector’s dominance in higher education is poised to decline as the government encourages private sector involvement. Colliers suggests that the private sector could open branches of international universities in Saudi Arabia, akin to the UAE and Egypt. This move would capitalize on the significant number of Saudi students already studying abroad.
It is crucial for regulators to ensure a balance between public and private education provisions, considering income disparities and the need for affordable education for all families. Moreover, a transparent and stable regulatory framework is pivotal for fostering private investment in the education sector.