x Abu Dhabi, UAESunday 23 July 2017

UAE wages set to rise by 6% this year

Salaries in the UAE are expected to rise by 6 per cent this year after more than half of respondents in a recent poll reported they did not receive a pay rise.

More than half of the Gulf's workers did not receive a pay rise last year.

Wages are expected to increase by an average of 6.3 per cent in the UAE this year, a new survey forecasts.

Just 45 per cent of the 32,000 people surveyed by GulfTalent.com said they received pay rises last year. Workers in Qatar and Saudi Arabia had the highest average salary increases, at 6.8 per cent and 6.7 per cent, respectively. The UAE and Bahrain had the lowest average increases, at 6.4 per cent and 5.7 per cent, respectively.

Recruitment companies say that while the wave of lay-offs that hit the region in the aftermath of the global financial crisis had slowed, companies were still restructuring and holding back on spending more on staff.

"Generally, things are still slow," said Charles Willson, a partner at the executive recruiter Willson McArthur in Dubai. "People aren't getting raises, except for in specific markets such as banking."

Mr Willson said that was primarily due to bumper earnings in the fourth quarter last year at lenders such as National Bank of Abu Dhabi, where profits rose by 71 per cent compared with the same quarter in 2009.

"Bankers are getting pay rises," he said. "Beyond that, the situation is that there are still too many companies out there, ad agencies, construction companies, everything. Once we see more consolidation, then wages will pick up."

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The survey found that while 61 per cent of the 1,400 companies interviewed in the survey expected to hire this year, 9 per cent said they would lay off staff.

GulfTalent.com said the pay increases across the region last year broadly tracked inflation but were just a fraction of the double-digit rises seen during the peak of the economic boom in 2008.

The retail sector saw the greatest increase in the Gulf, at an average of 6.4 per cent, while education saw the lowest at 3.8 per cent. Employees in the human resources (HR) departments of companies had the biggest raises at 7.1 per cent, while lawyers had the lowest at 4.3 per cent.

"Many executives told GulfTalent.com that with their companies increasingly focused on performance, the HR function had assumed a much greater significance," the survey said.

As Asian professionals saw more job opportunities in their home countries, they were able to negotiate the largest pay rises, at an average of 6.1 per cent. Westerners, whose home countries are still mired in downturns, saw an average increase of just 3.2 per cent.

And as more Chinese companies enter the Gulf to take part in major infrastructure and construction projects, there is greater demand for labour from China. GulfTalent.com said there was a "small but fast-rising Chinese presence".

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Qatar was a clear winner in the region's labour market, with "fast-rising salaries, falling costs of living, growing employment opportunities and an improving international brand" after the country's selection to be host of the 2022 Fifa World Cup.

In an analysis of vacancies advertised by employers and recruitment agencies on its website, GulfTalent.com said job opportunities in Qatar had grown to 16 per cent of all Gulf job vacancies last year from 8 per cent in 2008.

The UAE remained the most attractive place to work, however. About 72 per cent of residents prefer to remain in the UAE rather than relocate elsewhere in the region.

About 5 per cent of people living in Dubai commute to work in Abu Dhabi now, a fivefold increase on 2008.

 

bhope@thenational.ae