Saudi Arabia’s non – oil private sector continued to expand in June at a fast rate and job creation rose to a 19 – month high, a survey showed, as the largest Arab economy recovers from the coronavirus crisis.
The seasonally adjusted IHS Markit Saudi Arabia Purchasing Manager’s Index (PMI) stood at 56.4 in June, unchanged from May, maintaining its fastes pace of growth since January.
An increase in new orders, the fastes in five months, boosted business activity, reflecting the easing of coronavirus – related restrictions.
Input prices continued to increase but a slower rate than in May, suggesting that inflationary pressures may have peaked.
‘Demand growth in the Saudi Arabia non – oil sector ramped up again in June, with the latest signalling the strongest rise in sales since January’, said David Owen, exonomist at IHS Markit.
‘It was also encouraging to see a slight easing in overall input price inflation for the first time in 2021 – to – date …. This may be attributed to the relative strength of domestic supply chains, which have not yet been affected by global supply difficulties’, he said.
Confidence for future business activity hit a five – month high, with firms hoping economic recovery will accelerate further in the second half of the year.
The expansion of the private sector and the creation of jobs are core targets of Saudi reforms aimed at diversifying the economy of the world’s top oil exporter.
Employment in the non – oil private sector rose at the quickest pace since November 2019, according to the survey.
This echoed recent official Saudi data that showed unemployment among Saudi citizens droped to 11.7% in the first quarter of this year from 12.6% at the end of 2020.