The $500 billion megacity project in Saudi Arabia, known as NEOM, is experiencing a major shakeup as it plans a partial workforce layoff and the transfer of over 1,000 employees in its remote location in the northwest part of the kingdom to the capital, Riyadh. The move was announced by Semafor as part of a more comprehensive strategic review of the ambitious project, which is a flagship project under Crown Prince Mohammed bin Salman’s Vision 2030—a far-reaching plan to diversify the Saudi economy beyond oil.
The move represents a shift in approach to the one introduced by the previous CEO of NEOM, Nadhmi Al-Nasr, who required employees to reside and work at the remote development location on a full-time basis. The move will make employees who have been enjoying special location-based benefits like free housing, meals, and domestic services lose them. Nonetheless, NEOM has clarified that the pay packages will not be affected; only the remote-site allowances will be withdrawn.
In a LinkedIn post, NEOM Communications representative Sahar Al-Anbar admitted the change, saying that it was a logical step in the development of such a project. Change is not always easy, but NEOM is not merely a development project; it is a national vision that is ambitious, she wrote. Al-Anbar underlined that these strategic changes are not only natural but also essential to the megaproject management, as they lead to the better distribution of resources and reprioritisation of long-term objectives.
She explained that the benefits offered at the construction site were not the normal benefits but the remote-site compensation policy. When their relocation to Riyadh is done, employees will still get their current pay packages.
The Public Investment Fund (PIF), NEOM’s primary financial backer, has engaged external consultants to review the project’s scope and viability. Although particular review parameters are not disclosed, analysts indicate that the elements such as The Line, which is the linear city that is the hallmark of the project, are being reviewed, especially in terms of feasibility, budget implications, and technical issues.
Ever since its unveiling in 2017, NEOM has become a worldwide sensation with promises of AI-enabled smart cities and sustainable life. As recent events suggest, it is likely that NEOM will be recalibrated, rather than abandoned, but the vision itself has been altered to respond to the realities of implementation.
