For a young country accustomed to relying upon hydrocarbons exports for almost all of its income, education is at the heart of an ambitious agenda to mature and diversify into a knowledge-based economy by 2025. With this in mind, Saudi Arabia has stepped up investment in the education sector and in the young people who will be expected to drive that new society, but policymakers face challenges in the form of rapid population growth and an apparently ambivalent attitude to private sector opportunities among young Saudis. Minds may have to be changed as well as stimulated.

SECTOR BUDGET: Education spending for 2014 represents a quarter of total appropriations, and the allocated SR210bn ($56bn) is a 3% increase on the 2013 budget. The budget statement estimates that GDP in 2013 was SR2.795trn ($745.1bn) and based on that figure, education spending in 2014 equals 7.5% of GDP, up from 5.1% of GDP in 2008, according to UNESCO.

In 2008 the proportion of government expenditure on education was 17.1% compared to 25% in 2014. The latest data from the Central Department for Statistics and Information (CDSI) shows that the education budget increased by 63% from 2008 to 2012, from SR100bn ($26.7bn) to SR163bn ($43.5bn). The 2014 budget statement highlights SR3bn ($799.8m) worth of school construction projects, with 465 new buildings set to go up as well as ambitious plans for university campuses where eight new colleges will be constructed.

DEMOGRAPHIC PRESSURE: The expenditure is dictated by ambitions to improve the quality of education, but it is also a response to the pressure caused by demographics and specifically by the large number of young people in Saudi Arabia. According to figures from the UN and the CDSI, the population tripled from 1980, when it was 9.8m, to 2010 when it was just 5700 short of 30m. The country’s population growth rate is 2.7%, and 2.15% among Saudis, according to the CDSI.

Statistics on school and university students add more detail to this picture of growth and put the proportion of young people in the country into perspective. Free education is offered to all Saudi children and their time at school is structured into six primary grades, and three years each at the intermediate and secondary levels. Based on figures for attendance at state and private primary, intermediate and secondary schools in 2012 and student numbers at universities, both at home and abroad in 2011, there were just under 7.5m Saudis in full-time education.

Out of the country’s total population of just under 30m, some 20m are Saudis, which means school and university students account for 25% of the entire population and 37.5% of the Saudi population. Between 2010 and 2012, primary school attendance across both the private and state sectors rose from 3.32m to 3.44m, up 3.6%, and in secondary schools, again both private and state, pupil numbers increased from 1.44m to 1.48m, up 2.8%. Intermediate schools saw a negligible fall of 0.1% from 1.595m to 1.579m. If primary, intermediate and secondary schools are combined, total numbers rose from 6.36m in 2010 to 6.49m in 2012, an overall increase of 2%. The rate of growth may not seem particularly significant in percentage terms, but it translates into an additional 138,847 pupils in schools run by the state and by the private sector.

PRIVATE SCHOOLS: Although the school population statistics only cover a two-year period, another clear trend is emerging at all three stages for more students to move from state schools to the private sector, even as the government is boosting its expenditure on the sector. Within this wider change, it seems parents are more prepared to make financial sacrifices for the education of sons than they are for daughters.

The total number of children in private schools in Saudi Arabia rose from 674,837 in 2010 to 726,185 in 2012, an increase of 51,348 students. That represents growth of 7.6% in the private school market. It also means the proportion of children in private schools has risen from 10.6% to 11.1% in that two-year period.

The number of boys in private schools went up from 428,381 to 467,569, a 9.1% increase over the two years from 2010 to 2012, while there was a more modest 4.9% rise in girls in private education, up from 246,456 in 2010 to 258,616. The figures recorded by CDSI do not include Saudi children sent abroad to board at independent schools in the UK or US.

INVESTMENT: In October 2013 Saudi-based Itqan Capital announced it intended to invest in the Kingdom’s independent school market and that it had signed a memorandum of understanding with D3 consultants, a firm specialising in establishing and running schools. Itqan, which is part of Bahrain’s Al Baraka Banking Group, is hoping to raise $200m for its fund and plans to start acquiring and running primary schools once it has received the necessary approval in 2014. The company will also operate in other GCC countries. Itqan estimates the private education sector in the Gulf is worth SR21bn ($5.6bn), driven by growing populations, with Saudi Arabia constituting the biggest market.

In December 2013 the National Committee for Private Education announced that it was planning to launch Saudi Skills, a holding company for education investments, and that investors had shown interest. In January 2014 Ministry of Education sources told a local newspaper the ministry had been conducting a feasibility study on offering parents an annual SR2000 ($533) subsidy to enrol each of their children in private schools to alleviate pressure on the state sector.

FOREIGN SCHOOLS: Among the fee-paying institutions in Saudi Arabia are international schools, which fall into two categories. Some follow the curriculum of their home country, such as the UK, France or the US, while others are Saudi-owned schools accredited by international bodies such as the European Council of International Schools or SABIS, which follow an internationally approved curriculum. Many parents feel these schools may help their children to prepare more effectively for overseas universities.

QUALITY STANDARDS: Access to education appears to be improving, with Saudi Arabia’s younger people showing improved results to standard international measures compared to older citizens of the country. There is, for example, a marked improvement in literacy, particularly among women. The literacy rate for women over 15 is 82.2% compared to 97% among 15-24 year-old women, while men aged 15-24 have a literacy rate of 99% compared to a rate of 90.8% among all males over 15. There were 2.5m illiterate adults in the Kingdom in 2011, 59% of them women; and among the 15-24 year-old group, there were 100,000 people who could not read or write, 74% of them female.

By 2015 UNESCO predicts adult literacy levels will have improved among the wider population to 89.3% and among the youth group to 98.6%. Saudi Arabia fares reasonably well by this measure when compared to Arab states as a group where the average adult literacy rate is 76.9% and the youth literacy rate is 89.8%.

ASSESSMENTS: Saudi Arabia has entered its fourth and eighth graders into international maths and science tests run by the Trends in International Mathematics and Science Study (TIMSS). These tests are run every four years and the Kingdom’s children took part in 2003, 2007 and 2011. Every year the same group of East Asian countries tend to come out on top, including China, Taiwan, Singapore, South Korea and Hong Kong.

Saudi Arabia’s performance has been below the international average in both subjects. In Grade 8 science the average score for all 38 countries taking part was 500 and Saudi Arabia’s score was 436, while in maths the average was once again 500 and Saudi Arabia’s score was 394. These results have prompted some educationalists in the Kingdom to suggest that too much emphasis is put into the quantity of resources given to schools and not enough is invested in the quality of teaching. It has been suggested that standardised tests should be used to measure student attainment across all schools each year for students in certain grades.

Further efforts to assess outcomes are under way. The formation of a new Public Education Assessing Authority was announced in the 2014 budget speech, and at the end of 2013 UNESCO and Saudi Arabia launched a new collaboration at a workshop in Riyadh that had been convened to discuss educational standards according to UNESCO’s General Education System Quality Analysis/Diagnosis Framework. Noura Al Fayez, the deputy minister of education for girls’ education, plans to create a Regional Centre for Quality and Excellence in Education with UNESCO backing which would provide guidance and resources for the whole GCC area. “The ministry is making concerted efforts to achieve the leadership’s vision regarding the concept of comprehensive quality, which is a national strategic option to support the Kingdom’s move to become a knowledge-based country,” said the deputy minister.

TATWEER: A key institution in Saudi Arabia’s educational ecosystem is the King Abdullah bin Abdulaziz Project for Developing Public Education, which is known by its Arabic acronym, Tatweer. It deals with many of the practical aspects of educational administration such as school-building projects, school transport and supplying school equipment, and was set up under its parent, the Tatweer Educational Holding Company.

Tatweer has announced a deal with international education company Pearson to train 10,000 maths and science teachers over two years. The programme will use online, face-to-face and self-study approaches and is based on a train-the-trainer model. The initiative will employ 500 Saudi-based educators who will be accredited by the Ministry of Education.

“To improve the level of maths and science success amongst Saudi school students, there is a strong need to build both teachers’ subject area knowledge and subject-specific pedagogy skills,” Sherry Preiss, Pearson’s senior vice-president for professional development, said in a news release about the partnership.

The next set of TIMSS maths and science tests is due to take place around the world in 2015 and the Ministry of Education will be hoping to see the impact of these reforms in teaching practices by then.

In January 2014 Pearson won another contract through Tatweer to work on improving the quality of English-language training for teachers of English. In a further effort to improve the size and skills of the sector workforce, a scheme called Preparing and Training Teachers is being introduced to bring 15,000 male and female graduates into teaching. Teacher training falls under the remit of the National Centre for Assessment in Higher Education, which was created in 2002, but Tatweer also takes a hand in this task through its Maths and Science Teacher Development Programme.

CURRICULUM REFORM PROCESS: A newly re-written national curriculum also demands a change in teaching styles, which have traditionally been based around rote learning in small groups. The aim is to encourage enquiring minds by promoting autonomous learning methods supported by more imaginative texts and e-learning resources and by developing a classroom environment in which the teacher is seen as a facilitator of the search for answers and insights, rather than an autocratic source of all knowledge.

“We are in the era of learning, not teaching,” Ahmed Al Shoaibi, the director-general of Institute of Public Administration, told OBG. “This depends on the student committing to bettering themselves without the organisation and structure required from a classroom.” In November 2013 Khaled Al Sabti, the deputy minister for education, said the new system had already been adopted by 786 high schools across the country.

EMPLOYMENT SKILLS: While building a knowledgebased economy may be the mid-term strategy, a more immediately pressing issue affecting young Saudis preparing to leave school in 2014 is the prospect of unemployment. Although the proportion of Saudi youth enrolling in university has nearly quadrupled since 1995, according to the IMF, female enrolment tops 54%, and fewer young men choose to attend.

Overall Saudi unemployment is 11.7%, but it can be as high as 30% among those aged 15-29, and the rate among young women is 35%. Traditionally, young Saudis have tended to prefer the job security, regularity and prestige of a public sector post. However, the government has acknowledged that if the economy is to diversify, young people need the skills that will enable them to thrive in the private sector. To this end, the Human Resources Development Fund was established in 2000 to help bridge the skills gap between young Saudis and the private sector. The fund launched a pilot project in April 2014 inspired by the German dual education system where apprentices learn some skills in the workplace and others in a vocational school.

“We would like to create an ecosystem to see a mixture of on-the-job learning, e-learning through an e-platform and a public-private partnership that we can have for anybody to sign up for,” said Mohammed Mosly, deputy director-general of special programmes at the Human Resources Development Fund. “It is about teaching technical, vocational students and linking them to opportunities in the private sector.”

Of the pilot started in April, Mosly said, “We have tactically selected a few companies and some specific occupations within those industries, and a mix of large employers and small and medium-sized enterprises to begin with. We are also selecting a range of jobseekers including students, unemployed people, and TVET [technical and vocational education and training] trainees from different cities and genders for the pilot.”

There has also been a greater emphasis on vocational training, which is more closely geared to the needs of specific industries. These programmes offer an alternative for secondary school students who do not wish to pursue an academic university course and encourage young people to look for job opportunities beyond the civil service. Dar Al Hekma University, for example, provides stand-alone professional development courses on topics such as computer skills, soft skills, business writing and business English, among others.

Ali Al Ghafis, governor of the Technical and Vocational Training Corporation, told OBG, “The overwhelming majority of workforce needs lie in the technical and vocational fields. Therefore, both citizens and companies are able to benefit from the opportunities provided by comprehensive training infrastructure.”

HIGHER EDUCATION: University education is provided free, or almost free, for all citizens, and increasing numbers of young men and women are taking university courses. The latest figures from CDSI show there were just over 1m Saudis in full-time higher education in 2011, with more than 11% of them studying abroad on funded scholarships. The 2014 budget statement revealed that more than SR22bn ($5.9bn) was being spent by the King Abdullah bin Abdulaziz Scholarship Programme, to support 185,000 Saudi students studying at universities abroad, including money for chaperones and family members who travel with them. That is equivalent to SR118,000 ($31,459) per person. “I think higher education has a special role in Saudi Arabia, because 60% of our population are youngsters and they can help us to build a strong society,” Abdulmohsen Aloqaili, advisor and general supervisor of planning and statistics at the Ministry of Higher Education, told OBG. “With this huge spending in education we are approaching a very nice future, I hope, by providing our children with very high scholarships. We currently have 150,000 students studying in 50 countries. They are in the US, UK, France, South Korea, China, all over the world.” Indeed, CDSI figures show that in 2011, 116,121 students were studying abroad. The most popular countries were the US and the UK. Of the 88,812 men abroad, 41,006 or 46% were in the US, and 11,620 or 13% were in the UK. Of the 27,309 female students, 10,764 (39.4%) went to the US and 4447 (16%) went to the UK.

The overseas scholarship programme is designed to allow Saudi students to benefit from the best courses around the world and to bring their knowledge and insights back to benefit their home country. The most popular group of subjects for these students is the social sciences with 33% or 38,421 young men and women enrolled in these subjects. Engineering is the second-most-popular field, accounting for 18.75% of courses selected, but only 852 of the 21,769 Saudis enrolled on engineering courses were women. Medicine comes third in the list, with 19,602 students enrolled on medical courses, or 17% of the total. Approximately a third of all medical students on the scholarship programme were women. “The King Abdullah Scholarship Programme is already starting to show tangible benefits for the Kingdom’s labour force. Students are returning with different mindsets, cultural understandings and capabilities that will make them valuable employees and eventually leaders in the business community,” Alwaleed Aldryaan, CEO of Al Khaleej Training and Education Company, told OBG.

SAUDI UNIVERSITIES: In Saudi Arabia itself 898,251 students were enrolled on degree courses in 2011, according to latest CDSI figures, including 492,089 women and 406,162 men. Female students accounted for 51.2% of those studying at home and abroad, and 54.7% of all students studying in the Kingdom, according to the CDSI statistics. “More than half of students in Saudi Arabia are female, and much growth can be expected in the sector of female higher education,” Amal El Tigani Ali, vice-dean of administration and finance at Dar Al Hekma University, told OBG.

The domestic higher education system has seen rapid expansion in recent years. “We have 25 universities and we used to have just eight,” Aloqaili told OBG. “Of these, 12 are newly established. The problem can be to provide the universities with faculty members. If you look at other countries it is the same. In China, which has the largest academic community, only 9% have PhDs and in India 30% have PhDs.”

The number of faculty members rose by 155% from 1999 to 2012. In 2000 there were 18,925 faculty members – 12,483 men and 6442 women – while in 2012 there were 48,788, including 19,660 women. By end-2012 there were 33 public and private universities, with 543 public and private departments, a figure that rises to 2393 when technical colleges are included.

In developing the tertiary education segment, the emphasis has been on ensuring that there is a geographical spread of campuses. Universities have also been responding to the rise of new industries. Links between academics and industry are helping to push research forward. For example, King Abdullah University of Science and Technology is working with the Saline Water Conversion Corporation to develop a desalination plant powered by photovoltaic technology.

FLEXIBLE LEARNING: The most recent university to open in Saudi Arabia is the Saudi Electronic University, which uses a blended learning model with a focus on electronic delivery of teaching materials, communication and guidance through the Blackboard platform, but with a requirement to attend some classes on campus and to take examinations at the university.

The institution, which was launched in 2011, has a focus on degrees in finance, health care and IT. “We are seeing the development of more e-learning capabilities across the higher education sector,” Abdullah Al Mosa, CEO of Saudi Electronic University told OBG. “The government is now looking to invest not only in higher education e-learning, but also to incorporate certain aspects into primary and secondary education as well. This will save time and money while improving the quality of education available in the Kingdom.”

OUTLOOK: As the authorities work to make the necessary changes to diversify the economy, modernising educational standards will be key to enhancing the lives of Saudi Arabia’s citizens and preparing them for life in an economy that is not driven by hydrocarbons wealth and expatriate labour. There are a number of challenges ahead, but the government aims to address these by allocating resources to the sector, transforming the physical environment at many institutions and funding programmes designed to change the way education is delivered. The biggest anticipated change for many young people is the prospect of a fulfilling career as a reward for their academic endeavours. To achieve this, however, many will have to revisit their preconceptions of work life and the knowledge and skills they will need to in a knowledge-based economy.