Regional companies are powering up their recruiting after clear signs of stronger economic activity this year in the region and globally.
Hiring is back in business
Jamie Miller is looking for a job in Dubai. Having decided to leave his position with a leading insurance company in the UK, Mr Miller is spending a week in Dubai to scout out possible vacancies in the financial-services sector and get a feel for the lifestyle in the emirate.
"For me, Dubai is the place I want to be because of the tax-free salary and the weather," says Mr Miller, 33, from London. He is visiting the UAE at the right time. Signs are emerging that companies in the Gulf are beginning to dust off their recruitment policies and hire staff again, either to fill positions overzealously cut during the economic downturn or as part of a drive to expand their businesses.
The changes follow a period of stagnation in the jobs market when companies were nervous about growth while the economy was sluggish. Prior to that, a combination of declining sales, project delays and cancellations prompted many businesses in the Gulf to shed staff as the financial crisis began to bite. Figures for the total number of redundancies across the region are uncertain, but the property and financial-service sectors were especially hard hit by tens of thousands of job losses.
The outlook for the financial industry, and particular investment banking, is still far from rosy. With many banks struggling to return to profit as they contend with non-performing loans and investment losses, recruitment in the financial services sector is less buoyant. "Investment banking will be slow in quarter one and quarter two," says Jennifer Campori, the Dubai-based managing director for Middle East and Europe of Charterhouse Partnership. "A lot of people will hang on to see if they get bonuses before they consider moving jobs and banking clients factor in who will leave and need replacing."
But in other sectors, clear signs of a recovery in the global economy and a pick-up in business activity in the region are instilling firms with the confidence to consider recruiting again. "We are finding that in the last two weeks of January and this month vacancies are opening up," says Christo Daniels, the general manager of IQ Selection, a recruitment consultancy in Dubai. Almost a quarter of all employers in the UAE plan to recruit in the next three months, a survey published last week by the jobs website Bayt.com shows. A further 26 per cent said they would "probably" recruit staff during the same period.
Employers in Saudi Arabia, Kuwait and Oman are the most likely to hire, with 33 per cent in Saudi Arabia and 29 per cent each in Kuwait and Oman saying their firms would hire staff in the coming months. In Qatar, meanwhile, 26 per cent of respondents said they would definitely recruit in the next three months, according to the survey conducted by the polling firm YouGovSiraj. Recruitment levels, however, are not expected to reach the frenzied peaks of two years ago. Then, with a plethora of jobs on the market, potential candidates could often drive a harder bargain with prospective employers to ensure a lucrative remuneration package.
Now, not only are employers likely to be more selective in their hiring processes, they are also more cash-conscious, less willing to offer the rich pay packages extended to new staff prior to the financial crisis. Most analysts agree that salaries are down by between 10 per cent and 30 per cent from 2008. One recruiter estimates property firms have cut new salaries by 20 per cent for project-management jobs, while global multinationals that were offering Dh36,000 (US$9,800) a month for senior positions are now offering Dh32,000, a decline of 11 per cent.
At the same time, however, this fall has been offset by a reduction in living costs in the region as inflation has eased. "Companies are negotiating harder to try to get more for what they pay for and are taking more time over the process and salaries as a result have been affected," says Cliff Single, the commercial manager at the recruitment consultancy BAC Middle East. "Companies are less willing to spend on big relocation packages as there's a risk of bringing someone in without regional experience."
The increasing selectiveness of companies may carry a risk, however. Recruiters warn that some business sectors in Dubai, such as the financial sector, may face a skills shortage as companies struggle to encourage potential candidates to move to the former employment hot spot. Once considered the land of opportunity by people looking to move abroad, the emirate's reputation has been knocked by the fallout from the financial crisis and Dubai World's debt problems and the ensuing negative international publicity it attracted. The result is fewer people making trips to the emirate to look for work, say recruiters.
"When growth picks up to a higher level we could find that a lot of people who were previously made redundant have moved on or found alternative jobs elsewhere. With a difficulty in bringing people in from outside, this could lead to a candidate shortage in the next six to 12 months," says Mr Single. Some employers have already started hiring. The internet company Yahoo is looking to fill 35 roles, mainly in editorial and sales, this year in Dubai, Jordan and Egypt. The move follows the company's purchase of the Arabic internet portal Maktoob last year.
At a time when few of its competitors have embarked on large recruitment drives in the region, Yahoo feels it could enjoy the pick of skilled candidates. "For certain positions we can have a better pool of people in terms of quality and we weren't affected by the slowdown so much," says Ahmed Nassef, the vice president and managing director of Yahoo Middle East. The boutique recruitment firm Charterhouse Partnership has already noticed a 25 per cent to 30 per cent increase in recruitment from the end of the third quarter to the fourth quarter last year.
"We have seen an increase in people rolling out plans and being more confident," says Jennifer Campori, the Dubai-based managing director for Middle East and Europe at Charterhouse Partnership. "In the first quarter many firms are planning ahead and hiring will start in the second quarter." Certain sectors are showing more signs of life than others. Professional services, the oil and gas sectors and recruitment for partnership ventures between government and private companies are experiencing more activity.
Fast-moving consumer goods (FMCG) companies, especially global multinationals, are creating jobs as they look to build their presence in the region. "In the last year and this year FMCGs are starting to move into the UAE and the Saudi Arabian market, which has massive potential," says David Greenwood, the manager of sales, marketing and retail in the Middle East for the recruitment agency Michael Page International.
With the cost of advertising falling in the past year, many companies can afford to set aside bigger budgets for recruiting staff, he says. Other sectors are proving more sluggish. A slowdown in the Gulf's once booming property market means new jobs are thin on the ground in property and construction, a previously fast emerging sector responsible for generating a significant number of positions every year.
Demand remains subdued due to the fall in property prices and a scaling back of new building projects. What appears likely is that a recovery to a more modest level of growth in the economy in the medium term will spur a more measured level of recruitment than before the financial crisis. "We are moving towards a more mature and sustainable market" says Mr Single. A more mature market should ensure potential new recruits such as Mr Miller are able to hold down jobs in the region in the event of another downturn.
"Hopefully next time I'll be back for good," he says as he heads home from Dubai to the UK. firstname.lastname@example.org