Saudi Arabia is losing an estimated SR196bn ($52.3bn) each year due to inefficiencies and skills mismatches across the workforce, according to new research by Pearson.
The report — “Lost in Transition: Fixing Saudi Arabia’s SR62bn ‘learn-to-earn’ skills gap” — highlights how slow career transitions, skills mismatches, and automation risk are costing the Kingdom billions in lost earnings annually for Saudi nationals.
Pearson’s research found that learning and career transition gaps are draining SR62bn ($16.5bn) in annual earnings for Saudi citizens, rising to SR196bn ($52.3bn) — or 4.2 per cent of GDP — when including non-Saudi workers.
Saudi skills gap
Automation disruption alone accounts for around half of these losses and places 23 per cent of jobs in Saudi Arabia at high risk.
The report estimates that reducing reskilling time for affected workers by just 20 per cent could add SR6.3bn ($1.68bn) in annual earnings.
Saudi high school and university graduates currently take an average of 40 weeks to find employment, while displaced workers spend 11.3 months unemployed before re-entering the labour market. Around 40 per cent remain jobless for more than a year.
Youth unemployment stands at nearly 15 per cent, and demographic pressures are rising as the population aged 20–24 is expected to grow from 2.69m in 2025 to 3.22m by 2030.
Saudi Arabia’s skills gap
| Metric | Impact |
| Annual loss for Saudi nationals | SR62bn ($16.5bn) |
| Total losses including expats | SR196bn ($52.3bn) |
| Share of GDP affected | 4.2 per cent |
| Jobs at high automation risk | 23 per cent |
| Avg. time for graduates to find work | 40 weeks |
| Avg. unemployment duration (displaced workers) | 11.3 months |
| Youth unemployment rate | ~15 per cent |
5 ways to close the ‘learn-to-earn’ divide
Aligned with Vision 2030, Pearson recommends five coordinated actions between government, educators, and employers to bridge the gap and strengthen Saudi Arabia’s learning-to-earning pipeline:
- Diagnose skills needs: Support educators and employers in identifying high-priority roles and skills to enable targeted development programmes
- Shorten transition times: Expand internships, apprenticeships, and mentorships to accelerate movement from classroom to career and job-to-job
- Adapt curricula and training: Align academic and vocational education with real-world labour market demands and emerging technologies
- Expand work experience opportunities: Foster industry partnerships and work placements that bridge the gap between learning and practical application
- Improve labour market intelligence: Invest in platforms that enhance visibility into job openings and skill requirements to reduce mismatches and transition delays
Building a resilient, future-ready workforce
Naseem Tuffaha, Chief Business Officer, Pearson, said: “Saudi Arabia’s youth-driven economy holds tremendous potential, but inefficient transitions are costing SR62bn annually while nearly a quarter of jobs face automation risk.
“The solution requires two key shifts: building modern skilling pathways that deliver job-ready capabilities and making ‘learning to learn’ a core competency across education and industry. This dual approach will help build the resilient, adaptable workforce needed to achieve the ambitions of Vision 2030.”
Widening skills chasm
The study is part of Pearson’s global “Lost in Transition: Fixing the Skills Gap” research series, which warns of a potential global “skills chasm” between employer needs and employee capabilities.
The company calls for a fundamental shift in how countries approach lifelong learning, reskilling, and workforce adaptability.
Why it matters
As Saudi Arabia works to diversify its economy and create high-value jobs under Vision 2030, addressing the “learn-to-earn” divide is becoming increasingly urgent.
Bridging the gap between education and employment could unlock billions in productivity gains, strengthen private-sector competitiveness, and accelerate the Kingdom’s transition to a knowledge-based economy.
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