The Kingdom of Saudi Arabia has revised the maximum wages for domestic workers, resulting in a 12.6% reduction for Ugandan employees. The wage payments for Ugandan workers have decreased from SR9,500 (Shs9,672,645) to SR8,300 (Shs8,450,837) per month, signaling a notable reduction of Shs1.2m.
This adjustment, communicated through a statement from Saudi Arabia’s Ministry of Human Resources and Social Development on Tuesday, is not exclusive to Uganda. Other affected countries include Kenya, Ethiopia, Philippines, Sri Lanka, and Bangladesh.
Among the listed nations, only African countries experienced a double-digit percentage reduction. Kenyan workers faced a 17.2% cut, seeing their monthly wages decrease from SR10,870 to SR9,000, while Ethiopian workers experienced a 14.5% reduction from SR6,900 to SR5,900.
The decision from Saudi Arabia’s Ministry of Human Resources and Social Development to lower the upper ceiling for recruiting domestic labor services is part of an effort to review recruitment costs and ensure equitable prices. The Ministry expressed its commitment to developing services, improving the labor market environment, and enhancing its attractiveness, emphasizing a keen review of service costs and systems based on economic variables.
This development poses challenges for Kenya, as the President William Ruto-led administration has recently launched an aggressive campaign to attract international employers, aiming to alleviate rising unemployment domestically. The reduction in wages from Saudi Arabia is expected to impact diaspora cash inflows, with remittances from the country contributing significantly to transmittal growth in the past months.
“The Ministry of Human Resources and Social Development has announced the reduction of the upper ceiling for the costs of recruiting domestic labour services in a number of countries…This step comes within the framework of the ministry’s efforts to review recruitment costs and ensure fair prices,” read a translated version of the statement, originally posted on the ministry’s official website in Arabic.
“The decision comes within the framework of the ministry’s endeavour to develop all services, improve the labour market environment and enhance its attractiveness, and the keenness to review the costs of services provided and systems according to economic variables,” added the Ministry in the statement.
