The seasonally adjusted Riyad Bank Saudi Arabia Purchasing Managers' Index rose to 58.4 in October from 57.2 in September - far above the 50 mark denoting growth and the highest reading since June.
New business expanded faster with the new orders subindex surging to 66.1 in October, also a four-month high, from 64.2 the previous month.
The growth in output and new business was spread across most sectors, including manufacturing and construction, the survey showed. Growth in output remained high although the subindex eased to 60.1, weaker than the long run trend.
"The surge in new orders signifies an expanding market and suggests that the non-oil sector is experiencing sustained growth and demand for its products," said Naif Al-Ghaith, chief economist at Riyad Bank.
"The employment expansion is a promising sign for the Saudi economy, as it suggests a growing demand for labour and a potential improvement in the job market," he added.
The employment subindex rose to a nine-year high of 54.5 in October from 52.0 in September.
Creating jobs for citizens in an expanded private sector is a priority for the government as it implements a wide-reaching economic diversification plan known as Vision 2030 spearheaded by Crown Prince Mohammed bin Salman.
The government estimates non-oil economic growth in 2023 of around 6%, significantly outperforming overall GDP growth.
While the degree of confidence in future output eased from the previous month, firms remained optimistic overall.
(Reporting by Rachna Uppal; Editing by Hugh Lawson)
