Saudi Arabia’s drive to build a clean hydrogen economy could create new employment opportunities and accelerate the development of green skills, but a shortage of locally trained talent means the Kingdom is likely to remain reliant on expatriate workers in the sector in the short to medium term, according to a study by Cian Mulligan and Sebastian Sons.
The analysis titled “Energy Diversification and a Shifting Labor Market in Saudi Arabia: Green Jobs and Education Potential in the Development of a Clean Hydrogen Sector”, examines how the Kingdom’s energy transition could interact with its long-running Saudization agenda and education reforms.
Saudi Arabia is seeking to diversify its oil-dependent economy under Vision 2030 and establish itself as a major producer and exporter of clean hydrogen. The country has also set ambitions to increase renewables to 50% of its domestic electricity mix by 2030, while pursuing wider energy-transition initiatives.
The study identifies hydrogen as a potential source of new jobs across renewable energy, electrolysis, carbon capture, transport, storage, research and development, operations and maintenance. However, it cautions that the scale of employment creation will depend heavily on how the Kingdom ultimately uses hydrogen domestically and whether it focuses primarily on exports.
The labour market challenge is particularly significant. Saudi Arabia has substantially increased the participation of nationals in the private sector, while Saudization policies have increasingly reserved selected occupations for citizens. At the same time, the labour market remains segmented, with expatriates continuing to account for a large share of employment, particularly in lower-skilled and technical occupations.
The study's analysis of Q2 2023 labour force data found that Saudi workers were younger and more highly educated on average than expatriate workers. Around 43% of Saudi workers held a university degree, compared with 25% of non-Saudi employees, while Saudi workers were more concentrated in higher-skilled occupations.
This creates a potential mismatch with some of the jobs expected to emerge from hydrogen projects. Renewable energy projects, for example, are expected to require significant numbers of machine operators, elementary workers and technicians.
Electrolyser projects are likely to generate substantial employment during construction, including for metal workers, assemblers, engineers and legal professionals, but permanent operational roles are expected to be considerably fewer.
Carbon capture projects could similarly create construction-related employment, while ongoing operations would require machinery installers, maintenance workers and repair specialists.
As a result, the study argues that simply expanding Saudization may not be enough to localise employment in the hydrogen economy. Saudi Arabia will need to develop specialised technical and vocational pathways alongside university-level programmes to ensure that nationals have the practical skills required by emerging energy industries.
Several Saudi institutions have already begun building capabilities in this area. King Saud University offers a renewable energy master's programme with a dedicated hydrogen energy track, while King Fahd University of Petroleum and Minerals has established an interdisciplinary research centre focused on hydrogen and energy storage. Other universities and research institutions are also developing renewable energy and power systems capabilities.
However, the study highlights gaps in coordination, curriculum development, training for trainers and multidisciplinary education. Hydrogen education remains fragmented, with much of the existing focus centred on engineering rather than the broader skills needed across the emerging industry.
Technical and vocational education and training could therefore become particularly important. Yet cultural preferences among Saudi students for academic degrees over vocational qualifications remain a challenge, despite efforts to expand TVET participation.
With domestic training capacity still developing, the authors expect Saudi Arabia to continue recruiting skilled expatriate workers, particularly during the early stages of the hydrogen industry's development. International expertise could be required in areas including hydrogen engineering, technology maintenance, production, training and specialised technical services.
The study also sees an opportunity for greater collaboration between Saudi universities, energy companies and international educational and research institutions to develop scholarships, academic exchanges, vocational programmes and reskilling initiatives.
For Saudi Arabia, the clean hydrogen transition could ultimately become more than an energy diversification strategy. If supported by targeted education and skills development, it could provide a pathway to create higher-quality green jobs, expand technical capabilities and increase the participation of Saudi nationals in an emerging global industry.
Without sufficient investment in local skills, however, the Kingdom risks creating a hydrogen economy whose most specialised roles continue to depend heavily on international talent.