The average professional will see little or no salary growth in 2025, a poll of more than 1,000 companies in the Gulf has shown.
Recruitment firm Cooper Fitch said wages in the UAE would be largely flat next year due to a surge in population and influx of jobseekers.
The report was published as inflation in Dubai runs at 3 per cent and 2.4 per cent nationwide, driven by rising rents, which would feel like a wage cut for many. The UAE led the Gulf in terms of job creation in the third quarter of this year with an 8 per cent increase.
Over the past 12 months, 41 per cent of UAE employers raised salaries for new hires, with 7 per cent increasing wages by more than 10 per cent, the data found. But 29 per cent said they had reduced salaries offered to new recruits.
About half of companies polled - 44 per cent - intend to increase salaries for new hires next year. More than a quarter of organisations have no plans to adjust salaries in 2025.
“Despite global economic shifts, the UAE continues to show remarkable job creation and economic growth,” said Trefor Murphy, founder and chief executive of Cooper Fitch.
“The past 12 months have been immensely positive for the UAE in terms of job creation … Key sectors such as real estate, banking and finance, and technology are continuing to attract talent from around the world.”
The UAE recorded a 42 per cent increase in the number of property professionals in the first quarter of this year compared to the previous quarter, and the volume of jobs posted in the sector increased by 94 per cent in the same period, the Cooper Fitch report said, citing data from professional network LinkedIn.
“The nation’s real estate sector continues to drive significant demand for talent, with markets like Dubai, Abu Dhabi and Ras Al Khaimah drawing property professionals from across the globe,” it added.
The technology industry also remains a catalyst for job creation in the Emirates. Recruitment related to artificial intelligence may not have reached the heights that some predicted, but 43 per cent of UAE-based respondents to a recent SAP YouGov survey identified a lack of talent in this field as a key challenge, the guide said.
Cooper Fitch said that airline-related recruitment has also risen in the country. Dubai-based Emirates airline’s workforce grew by 10 per cent to 112,406, its largest size ever, according to the carrier’s 2023-24 annual report. Abu Dhabi's Etihad Airways hired more than 2,300 new employees last year.
“The Emirates has also been a magnet for hedge funds over the past 12 months, attracting names such as Brevan Howard, Millennium and TCI Fund Management, with several other high-profile investment firms currently awaiting approval,” the consultancy said.
The report found that the mining, metals and natural resources, consulting and professional services, and hospitality, travel and tourism sectors represent the most significant talent gaps in the UAE at present.
Other industries facing a talent shortage include government and public sector, information technology and telecoms, logistics, transportation and supply chain, aviation, defence and aerospace, banking, financial services and insurance, real estate, construction and architecture, and marketing, advertising and public relations, according to Cooper Fitch.
Large bonus payouts coupled with population growth could serve to soften pay offers next year, the recruiter said.
Fifty-four per cent of organisations expect to grow their workforce over the next 12 months. Conversely, 31 per cent of those polled anticipate a reduction in headcount in the next year.
“It is interesting to note that the proportion of organisations anticipating expansion, contraction and stability in their workforces over the coming year is almost identical among respondents from the UAE and Saudi Arabia, suggesting parity between both markets,” the report said.
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Opening weekend Premier League fixtures
Weekend of August 10-13
Arsenal v Manchester City
Bournemouth v Cardiff City
Fulham v Crystal Palace
Huddersfield Town v Chelsea
Liverpool v West Ham United
Manchester United v Leicester City
Newcastle United v Tottenham Hotspur
Southampton v Burnley
Watford v Brighton & Hove Albion
Wolverhampton Wanderers v Everton
Zombieland: Double Tap
Director: Ruben Fleischer
Stars: Woody Harrelson, Jesse Eisenberg, Emma Stone
Four out of five stars
What vitamins do we know are beneficial for living in the UAE
Vitamin D: Highly relevant in the UAE due to limited sun exposure; supports bone health, immunity and mood.
Vitamin B12: Important for nerve health and energy production, especially for vegetarians, vegans and individuals with absorption issues.
Iron: Useful only when deficiency or anaemia is confirmed; helps reduce fatigue and support immunity.
Omega-3 (EPA/DHA): Supports heart health and reduces inflammation, especially for those who consume little fish.
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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