Jadwa Investment research says around 950,000 SMEs are registered for business purposes in Saudi Arabia
Small and medium enterprises (SMEs) currently provide employment for 1 million Saudis and 3.7 million foreigners, according to data from the General Authority for Statistics (GaStat).
The statistics, cited in a new research note from Jadwa Investment, show that around 950,000 SMEs are registered for business purposes in Saudi Arabia.
The figures also showed that Saudis working for SMEs, on average, received a monthly salary of SR6,600, compared to SR9,900 per month received by Saudis working in larger enterprises.
The same data showed that of the one million Saudis employed in SMEs, around 33 percent are employed in wholesale and retail, and 10 percent in the manufacturing sector. In terms of Saudization, SMEs in the finance and insurance sector hire the biggest share of Saudis with 61 percent, followed by real estate at 48 percent.
One of key objectives outlined in the Saudi Vision 2030 relates to raising the level of SMEs' contribution to GDP. Specifically, the target refers to raising the current contribution of 20 percent of GDP to 35 percent by 2030.
A number of major reforms and initiatives have been implemented to support the development of SMEs in the kingdom Jadwa said, addding that overall, the government plans to introduce previously absent sectors into the economy, which will not only help economic diversification efforts, but also provide sizable opportunities for entrepreneurs.
"As these reforms begin to take shape, and the business environment for SMEs improves, we expect to see the overall contribution of SMEs to rise in the local economy over time," added Jadwa.