The labor market in Saudi’s technology sector amidst salary inflation

G. Gokul Kumari and Maha Bader Mohammed Almaiseb

International Journal of Manpower, 2025, vol. 46, issue 8, 1507-1525

Abstract: PurposeThe purpose of this study is to analyze how salary inflation impacts the technology sector in Saudi Arabia.Design/methodology/approachThe major goal of the research technique is to direct the researcher at each stage to achieve the study’s principal goals. This quantitative study employed the survey approach. A quantitative technique was chosen because it enables both objective examination of the relationship between factors and prediction. The research process involves a study of the body of literature, the development of research questions and the creation of tools and techniques for data collecting, data analysis and modeling.FindingsThe responses were entered into IBM SPSS, and a statistical evaluation, namely exploratory factor analysis, was performed. This was done to identify and categorize issues on how Saudi Arabia’s technology industry is affected by salary inflation. The results show that examining how salary inflation affects different facets of the labor market in the technology industry requires a comprehensive methodology. Although wage inflation may have an impact on hiring and employee retention across all sectors, its link with company profitability is more nuanced.Originality/valueThe results showed that wage inflation has a major impact on hiring activity throughout the economy, employee attrition and business profitability. To conclude, the result of the study shows that firm profitability, employee turnover and economy-wide recruitment have been significantly impacted by the salary inflation of technology sectors. The outcomes showed that the demand for professionals moderates the relationship between salary inflation and economic outcomes, employee turnover and economy-wide recruitment.

Keywords: Technology sector; Salary inflation; Labor market; Workforce dynamics; Saudi Arabia (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eme:ijmpps:ijm-09-2024-0593

DOI: 10.1108/IJM-09-2024-0593

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