The Saudi non-oil private sector maintained robust growth in February 2025, driven by strong customer demand, increased employment and positive economic outlook, despite a slight decline from January's decade-high reading.

According to the latest Purchasing Managers' Index (PMI) report from Riyad Bank, the index registered 58.4, reflecting sustained business activity growth despite dropping from January's decade-high of 60.5.

Naif Al-Ghaith, chief economist at Riyad Bank, said: "Despite the slight decrease in the PMI, the Saudi non-oil economy remains on a strong trajectory."

He added that increasing domestic and international demand, alongside continued improvement in supply chains, indicates business activity will maintain its positive momentum throughout 2025.

The PMI measures non-oil sector health using key factors, with readings above 50 indicating growth and below 50 signalling contraction. Despite February's slight decrease, business conditions remained robust, supported by steady new orders and increasing exports.

Companies across various industries reported resilient demand conditions, with 35% of surveyed firms reporting increased new business orders, compared to only 5% reporting a decrease.

Export orders rose sharply, reflecting strong international demand for Saudi non-oil goods and services. Some companies noted that promotional pricing strategies helped attract new customers.

A significant rise in employment was a standout feature of February's PMI report, reaching a 16-month high as companies expanded their workforce to meet increasing workloads. This employment growth was particularly strong in the manufacturing and services sectors.

The non-oil sector growth was driven by strong domestic demand and increased tourism activity, contributing to enhanced sales and production levels. Companies attributed their expansion to intensified marketing efforts and a larger customer base.