Saudi Arabia’s Ministry of Labour and Social Development has warned wholesale and retail companies that new restrictions on jobs in the sector come into force in 12 days.

The new rules, first announced in January, require 70 per cent of sales jobs at outlets selling 12 types of items to be held by Saudis.

The first phase, which came into force last month, applied to automobile and motorbike showrooms and shops selling items including ready-made clothing for men and children, home and office furniture, household goods and utensils.

The second phase beginning on November 9 will apply to “electrical and electronic appliances, watches and glasses shops”, the ministry said.

While a a third phase will come into force from January 7 requiring “medical equipment stores, construction materials shops, auto spare parts shops, carpet shops of all kinds, and confectionery shops” to comply.

The ministry said the decision was intended “to enable citizens and women citizens to work and raise their participation rates in the private sector”.

Local reports have indicated up to 1.22 million jobs held by foreigners could be affected by the new rules.

Inspectors have also found hundreds of outlets subject to the new regulation closed as business owners seek to avoid penalties for non-compliance.

Government data released this month showed Saudi unemployment was stable in the second quarter at 12.9 per cent after rising in Q1.

However, foreigners continued to leave the country, with more than 290,000 leaving the workforce over the three-month period

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