Saudi Arabia will raise the minimum wage threshold for Saudisation calculations in two phases, reaching SR6,000 in April 2028. Eligible citizens will also receive an additional SR500 per month as the Kingdom prepares for electricity and water tariff adjustments in January 2027.
King Salman bin Abdulaziz Al Saud ordered the measures following a proposal by Crown Prince and Prime Minister Mohammed bin Salman, according to the Saudi Gazette.
The government has also announced an additional SR500 in monthly financial support for eligible citizens. The support covers several groups, including public-sector employees, retirees and households receiving social security benefits.
Saudi Arabia raises Nitaqat wage threshold in two phases
The Ministry of Human Resources and Social Development said the revised wage criteria under the Nitaqat Saudisation programme will come into effect in two stages.
The new thresholds will determine whether Saudi employees count fully towards an employer’s Saudisation requirements.
| Effective date | Minimum monthly wage threshold |
|---|---|
| 25 April 2027 | SR5,000 |
| 25 April 2028 | SR6,000 |
Under the revised rules, employers must account for the applicable wage threshold when calculating their Saudisation ratios. Employees earning below that threshold may not count fully towards the required quota.
However, the ministry clarified that the decision does not require private-sector companies to automatically increase Saudi employees’ salaries.
Instead, the change affects how employers meet their workforce localisation obligations. Companies may therefore need to review salaries and workforce plans to maintain compliance with Nitaqat requirements.
The phased implementation also gives businesses time to assess the impact and prepare for the revised criteria.
SR500 monthly allowance to support eligible Saudi citizens
Alongside the Nitaqat changes, the government will provide an additional SR500 per month to eligible beneficiaries, subject to the applicable rules and procedures.
The announced support covers several groups:
- Civilian and military employees covered by civil service pay scales and employment programmes.
- Retirees.
- Eligible family members of deceased contributors or retirees covered by the Social Insurance Law.
- Households receiving social security benefits.
The allowance increase is intended to help eligible citizens manage the financial impact of upcoming electricity and water tariff adjustments.
Those adjustments are scheduled to take effect on 1 January 2027. The additional monthly support will provide financial assistance to eligible households as the changes approach.
What the revised Saudisation rules mean for employers
The wage threshold changes have direct implications for private-sector workforce planning in Saudi Arabia.
Employers will need to assess whether Saudi employees meet the revised criteria for counting fully towards their Nitaqat quotas. This is particularly relevant for businesses that rely on employees earning below the new thresholds to meet localisation requirements.
Companies should review their current workforce data, salary structures and projected hiring needs ahead of the April 2027 deadline.
The second phase, scheduled for April 2028, will raise the threshold further to SR6,000. As a result, employers have two implementation dates to factor into their compliance planning.
The distinction between a minimum wage requirement and a Saudisation counting threshold remains important. The announced measure changes how employees count towards localisation ratios; it does not, by itself, mandate an automatic salary increase for every Saudi employee.
Household support and workforce policy announced together
The two measures address different areas of Saudi Arabia’s economic policy.
The additional SR500 monthly allowance is intended to ease cost pressures for eligible citizens ahead of the planned utility tariff adjustments. Meanwhile, the Nitaqat changes revise the wage criteria that govern how private-sector employers meet Saudisation requirements.
For HR leaders and business executives, the immediate priority is to prepare for the first wage threshold increase in April 2027. Employers should also account for the further rise in April 2028 when planning compensation and workforce localisation.
The financial support measures, meanwhile, will apply to eligible beneficiaries under the relevant government rules and procedures.
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