Expecting a pay rise in Dubai soon? Well...
Expecting a pay rise in the UAE soon? Here’s the forecast of what we’ll all get…
We have some bad news folks: this year the pay rises given across the GCC are expected to be the lowest they have been in almost a decade due to the slowing economy.
According to a study by online recruitment firm GulfTalent, pay rises will be at around 5.2 percent in the region in 2016 (the average in 2014 was 6.7 percent, while in 2015 it was 5.7 percent). The study surveyed 25,000 professionals, as well as 700 executives and human resource managers in the GCC between December and February.
The increases this year are forecast to barely cover the rises in the costs of living (particularly given government subsidies are slowing down). In fact, the average ‘real salary increase’ in the GCC – meaning the extra disposable income we’ll have this year when you factor in inflation and rising cost of living – is forecast to be just 1.4 percent.
The UAE will see a higher rise than many places (due to our more diversified economy), with GulfTalent forecasting that our salaries will rise by an average of of 5.3 per cent. With our forecast inflation rate at 3.1 percent, our ‘real salary increase’ will be 2.2 percent.
Saudi Arabia will see slightly higher overall pay rises at 5.9 percent, while Qatar will be at 4.7 per cent, Oman will get 4.4 percent and Bahrain will see just 3.7 percent (matching the forecast inflation rate for the country).
The report included some findings about 2015 too, including the fact that those in HR saw the highest average pay rises in the GCC last year at a rate of 7 percent.
Here’s more on what they had to say about the GCC economy in 2015, and going into 2016…
“Faced with severe budget deficits, GCC governments have cut state subsidies as well as spending on non-essential projects, leading to a slowdown in the private sector. Not all sectors have been affected equally, however, giving rise to a two-tier economy. Energy companies have borne the brunt of the slowdown and laid off thousands of staff, while construction firms which depend heavily on government-funded projects have also seen a slowdown in new business. At the same time, sectors that rely on population growth and consumer spending such as retail and healthcare, are showing high resilience and continue to outperform the overall economy.”
The report does contain some good news for the UAE, however:
“The UAE continues to dominate as the most attractive destination in the GCC for expatriates. 63% of the professionals surveyed picked UAE as the place they would be most likely to move to. The country also enjoys the highest retention rate in the region with 88% of expatriates already residing in the country expressing a desire to remain there.”
And there’s some good news for workers across the region:
“GCC governments continue to gradually improve worker protections… Qatar and Saudi Arabia have followed the UAE in launching a wage protection system to guarantee timely payment of employee salaries. UAE recently removed the six-month visa ban on employees who leave their jobs, while Qatar’s proposed revamp of its Kafala system will also make it easier to switch jobs. This will increase staff turnover for companies, but help reduce the high attrition of expatriates from Qatar. Meanwhile, India and the Philippines have introduced their own measures to protect their citizens, requiring Gulf employers to register and guarantee a minimum wage.”