Saudi Arabia’s consumer and business sectors enjoyed strong growth momentum in 2026, supported by rising business confidence, high retail activity, and increased digital commerce. Recent economic indicators point to sustained momentum across several sectors, suggesting that businesses remain optimistic about economic conditions despite varying performance across individual industries.

Business sentiment improved in May 2026, with the kingdom’s Business Confidence Index (BCI) rising to 55.6 points from 54.5 points in April, according to the General Authority for Statistics and Information (GASTAT). The increase indicates that businesses generally expect economic activity to remain stable or improve in the coming months, supported by expectations for stronger sales, investment activity, and order volumes.

Confidence gains were evident across the economy. The industrial sector recorded a BCI reading of 54.3 points, up from 53.5 points in April, reflecting more positive expectations regarding overall business performance, sales, and purchase orders. The services sector also strengthened, with confidence rising to 54.6 points as businesses reported greater optimism about future performance, investment spending, and demand conditions.

The construction sector remained the most optimistic segment of the economy, with its confidence index reaching 56.7 points in May. Businesses cited stronger expectations for overall performance, sales activity, and exports, reflecting continued activity across development and infrastructure projects.

COMMERCIAL ACTIVITY JUMPS

The improvement in business sentiment has coincided with continued growth in commercial activity. Preliminary data show that operating revenues in the wholesale and retail trade sector increased by 7.3% year on year during the first quarter of 2026, while recording a modest quarterly increase of 0.5% compared with the final quarter of 2025, GASTAT data shows.

Retail activity was a notable contributor to this growth. Operating revenues for retail trade, excluding motor vehicles and motorcycles, increased by 9.6% compared with the same period a year earlier. Wholesale trade revenues also rose by 5.5%, while the sale and repair of motor vehicles and motorcycles recorded annual growth of 5.4%.

The figures suggest that consumer spending remained relatively resilient during the quarter, supported by continued economic activity and rising demand across a range of retail categories. On a quarterly basis, both retail and wholesale trade recorded further gains, indicating that growth was not solely driven by annual comparisons but also continued through the early months of 2026.

EMPLOYEE COMPENSATION RISES

The expansion in commercial activity was accompanied by rising labour costs, which may reflect increased hiring and wage growth across the sector. The Employees Compensation Index for wholesale and retail trade rose by 10.1% year on year during the first quarter. Retail trade recorded the strongest increase at 11.4%, followed by motor vehicle sales and repairs at 8.2%, and wholesale trade at 8.1%.

At the same time, digital commerce continued to gain importance within the retail landscape. The E-commerce Sales Index increased by 13.6% year on year during the first quarter, underscoring the continued shift toward online purchasing channels.

Retail e-commerce sales recorded the strongest performance, rising by 18.4% compared with the same quarter of 2025. Wholesale e-commerce activity increased by 10.0%, while online sales related to vehicle sales and repairs rose by 3.2%. The sustained growth in digital transactions highlights the increasing integration of technology into consumer purchasing behaviour and business operations. 

Automobile sales also remained positive overall, with the Automobile Sales Index increasing by 3.4% year on year during the first quarter, although sales moderated slightly on a quarterly basis.

ACROSS-THE-BOARD GROWTH

Broader economic indicators suggest that growth has extended beyond retail and consumer-facing sectors. In March 2026, the kingdom’s overall Oerating Revenues Index increased by 10.2% compared with the same month a year earlier and by 8.1% compared with February, GASTAT data shows.

Several sectors contributed to this expansion. Mining and quarrying revenues rose by 25.5% year on year, while manufacturing increased by 4.0%. Construction activity expanded by 4.8%, and financial and insurance activities recorded one of the strongest gains at 17.6%. Wholesale and retail trade revenues were also significant, increasing by 4.6% over the same period.

Together, the latest data point to an economy experiencing continued expansion across multiple sectors. Rising business confidence, growing retail revenues, increasing e-commerce adoption, and stronger operating revenues suggest that both businesses and consumers remain active participants in the kingdom’s economic growth. The overall trend indicates strong momentum in commercial activity, private sector development, and digital transformation during the first half of 2026.