The Middle East Job Market Update
The Middle East Job Market Update
This year, expats heading to the Middle East are in for some good news. Emerging markets are offering higher salaries to attract talent, forcing the UAE to bring back bonuses and allowances to stay competitive.
Yet, the past crisis has led companies to remain cautious by linking pay to performance, and not effect a wholesale increase in fixed packages.
Salary increase: 5-6%
According to Vijay Gandhi, regional director at Hay Group, the global management consultancy, potential hires too are taking a ‘holistic’ view of their remuneration. Salaries are rising but not as much as in Asia, and companies are being more selective about their hires. The idea is to cut down staff costs which have escalated due to the 50-60% increase in salaries over the past 5-8 years.
This year, the average growth in Middle East salaries will be 5-6% – higher than that in developed markets where debt-ridden governments are still looking to cut costs.
With the growth in salaries, the UAE’s high standards of living are proving more attractive than ever. There is a new breed of expats who have lived and worked here previously, and who now wish to relive the experience.
After the recession in the West made jobs and high salaries hard to come by, the number of returning expats in Dubai has gone up. “Yes, (they are coming back),” said Konstantina Sakellariou, Partner, Marketing & Operations Director at Stanton Chase International.
Hiring advisors Huxley Associates confirm that the UAE remains an attractive work destination for both new and returning expats. “Professionals are drawn to buoyant economies with resilience. This is what the UAE has shown,” said Hasnain Qazi, Middle East Business Manager at Huxley.
Sector Focus: Banking
In 2012, bankers received the biggest pay hikes in the UAE.
Job prospects in Europe are dim, and finance professionals are making a beeline for Dubai and other parts of the UAE.
Retail bankers are returning, mostly due to lack of opportunities in their home countries and the superior lifestyle they can enjoy in the UAE, according to Jennifer Campori, Managing Director, Middle East and Europe, at recruitment firm Charterhouse Partnership.
Ernst & Young’s recent European Banking Barometer says that cost-cutting will continue in the first half of 2013, with job losses to be seen across Europe. 45% European banks expect headcount to decrease in the next six months, worst hit being banks in the Netherlands and the UK with 70% & 64% banks expecting to let people go.
In contrast, the UAE offers sunny prospects, thanks to an increase in cash-flow as funds move to the UAE from other Arab countries, and also because investors see new opportunities in the region, shares Sakellariou of Stanton Chase International.
Best Places to Work
The Great Place to Work Institute released its list of ‘2013 Top Companies to Work for in the UAE’, stating that the results point to a maturing HR sector in the UAE. 15 companies made it to the list, a few of which are:
- Microsoft (Technology)
- Marriott (Hospitality)
- FedEx (Transportation)
- THE One (Retail)
- DHL (Transportation)
Job creation for UAE citizens/ nationals
H.H. Shaikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of UAE and Ruler of Dubai, has declared 2013 as the year of creating jobs for Emiratis.
He termed it a national priority for which all efforts must unite, and announced a series of initiatives for the improvement of the country. Year 2013 would surpass 2012, with every year likely to be better than the preceding one.
The latest figures released by IMA, The Association of Accountants and Financial Professional in Business (Middle East), show a 74% increase – over 2010 levels – in the median annual compensation of accountants.
The current package stands at 107,343 dirham ($29,225). Earlier, the highest compensations were to be found in Qatar but this time, the median is highest in Bahrain, while the average base pay and total annual compensation are highest in the UAE.
Accountants in the UAE earn a median salary of Dh211,203 ($57,500), while the annual basic pay is Dh183,654 ($50,000), which is a 32% increase over 2010 levels.
That rounds up our current Job Market Update. As is evident, ‘growth’ is still the mantra in the Middle East. It’s still a good idea to cash in on opportunities for a promising salary and a lavish lifestyle and all of it, of course, tax-free.
After a period of sluggishness, the job market in Dubai is looking up again. The first to benefit from this will be people who had stayed put at their – often unsatisfactory – jobs out of fear of the ‘Last in, First out’ risk of starting a new job during a recession. But things have changed and today, as a top recruitment industry expert puts it, several candidates whose careers had stagnated are looking for opportunities to move out of their current positions. Obviously, this translates into pressure for employers, 85% of whom are now worried about losing their ‘A’ teams.
If you are among those looking for growth or a better package, or simply, an exciting new job in a sector of your choice, then this is the right time for you too.
In a recent survey, a prominent UAE job portal found that as many as 66% of companies in the UAE are looking to hire within the next year. On an average day, this website lists 11,000 new jobs – a big jump from last year’s figures.
Confirming the trend, last September, the Monster job portal saw its ‘Employment Index Middle East’ jump by 10% year-on-year. However, before you rush to revamp your resume, take a moment and heed these words of advice:
- Do your research: Study prospective employers and be sure of their prospects before you agree to a position with any company.
- Work with the best: Select a recruitment agency/ firm and see whether they have the right knowledge about your sector to do the best for you.
Sectors set to grow
With 80% of all UAE companies looking to hire* within the next six months, it is worthwhile to figure out your options – and prospects – in various industries.
To start with, those in banking and finance are likely to benefit the most. As many as 85% of companies will look to recruit finance professionals, either to expand their teams or just to maintain status quo by replacing employees who have been lured away by greener prospects. Only 5% companies will actually cut down on their headcounts, even as opportunities abound in both, Dubai as well as Abu Dubai.
By announcing a slew of large-scale development projects, the UAE government is doing its bit to fuel this trend. This has encouraged private companies to follow suit. Because of this, oil, gas and petrochemicals will start looking up, further spurring growth in related sectors such as banking, construction, real estate and logistics. Spill-over effects will, of course, also be seen in the FMCG and retail segments.
These trends will be reflected in recruitment figures: 34% of top hires will head out to jobs in banking & finance, 32% will find themselves working in oil, gas and petrochemicals, while 27% will be picked up by telecommunications companies.
But, even as employees rejoice, recruiters are having sleepless nights trying to locate the right talent to fill various job roles. 87% of recruiters are finding it difficult to fill jobs, especially roles in financial or management accounting. With demand being so high, there is an additional fear of losing existing talent to competition, which explains the hefty pay hikes being seen in this vertical.
Several companies are actively courting expats to fill important positions, bringing in attractive packages/ benefits to do so.
Employees and companies alike are confident about the future, with 81% employees expressing positivity regarding the country’s growth prospects and 92% regarding their own company’s future.
Smart tips to a better salary/ package
In further good news, pay hikes will be back and most employees can expect to receive a decent 5% above-inflation increment over their current salary. Since pay is influenced by consumer price inflation, this hike indicates a real, as opposed to merely notional, growth in pay.
A recent online poll revealed that 90% of people working in the UAE believe they are underpaid. For these employees, even the increments they are set to receive this year may be of little consolation; many of them are actually finding it hard to meet the escalating cost of living in this region. Salaries had stagnated over the past two years and employees are now bearing the effects of this stagnation. The way out, of course, is to ask for what you feel you truly deserve. But there is a method to doing this right:
- Know your worth: Just as you research prospective employers and compare them with their peers, now do the same for yourself. Compare your pay with what your peers in different companies are being paid, for the same type of work. To do this, you can use online job portals to research how much is being offered to people with your experience, in your sector. Or just pick up the phone and call a friend who might be willing to share his/ her salary details over a friendly chat.
- Narrow down your range: Based on your research, come up with a realistic figure/ range that you think you should be paid. At this stage, also consider any other benefits that you might be receiving, which others in the industry may not have. For instance, you could have flexi-timings, additional leave options, company-sponsored health insurance, etc. Remember, not all remuneration is monetary, so focus on the entire package and not just the money you get.
- Gear up: Put together your key findings for ready reference. Have the facts and data handy. During the discussion with your boss/ prospective employer, you will have to focus on the quality of your work, the depth of your experience, and your significant achievements. “Maintain records of your achievements, hitting of targets and endorsements for out-of-the-box things you have done that has contributed to the bottom line, improvement of work environment, or new ideas you came up with that helped the business,” advises Hasnain Qazi, Middle East Business Manager at Huxley Associates.
- Be realistic: Recognize that you won’t suddenly receive a 40% hike, even if you managed to present a strong case for it. Salary hikes top off at 18-20% so if you get close to that, you’ve done well.
- Learn to say ‘no’: If you think the amount being offered is simply not justified, then do not let yourself be swayed into saying yes. The salary that you get upon taking up a new job will be your baseline for all future increments. So it is important to start with the correct baseline.
- Keep your mind open: If your company is unable to meet your monetary expectations, perhaps they would be willing to negotiate on the benefits? See whether you can improve your overall package, even if you do not receive a fantastic monetary hike.
Peak performance comes with perks!
Across the UAE, employees are seeking certain perks to enhance their quality of life. Most people try to maintain a good work-life balance, with flexi-time jobs finding more takers than the traditional 9-to-5 workplace. Government departments and companies like Microsoft and IBM excel at doing this, by offering work-from-home and other family-friendly options.
A recent ‘employee motivation’ survey said that 75% professionals really value work-life balance and find it motivating to work for a company that offers these options.
Expats working in the UAE, meanwhile, look to their employers to provide medical insurance, a special housing allowance/ company-provided accommodation, school fees for their kids, home-and-back air tickets for self and family, as well as a sizable annual bonus on their salary.
For most expats, the no-tax system is a key factor that propels them to pick the UAE over other destinations, shares Konstantina Sakellariou, Partner, Marketing and Operations Director, Stanton Chase International. Being valued at their workplace, training and development opportunities are additional considerations.
The top factors that come into play are:
- Work-life balance
- Training / development opportunities (54%)
- Feeling that their work has an impact (44%)
- Recognition of work and achievements
- Opportunity for career advancement (41%)
So there, just go out and grab what you deserve. 2013 is the year for you!
*Source: Executive search firm, Robert Half international
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