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Despite concerns about the global economy and falling oil prices, some companies in the UAE have increased the salaries of their staff by an average of 4 per cent this year, slightly above the country’s inflation rate.
According to management consultancy Hay Group, about nine in ten organisations (90 per cent) also paid “on or above target bonuses” this year, which could be a good sign for the country’s economy.
The company’s latest data, released on Monday, showed that those holding higher positions – the senior executives – brought home pay increases of between 3 per cent and 8 per cent.
Those working in the automotive and retail sectors have enjoyed higher adjustments of 6.4 per cent and 6.6 per cent, respectively.
The figures are a strong indication that businesses in the UAE have yet to feel the full impact of the global market turbulence and oil price decline. Hay Group, however, did not specify how many per cent of the companies in the UAE granted salary increases.
“Companies are treading with caution and we predict a more conservative approach to both general spending and future investment plans in both private and public sector organisations in the coming year,” said Harish Bhatia, regional manager at Hay Group.
“However, we are yet to see any significant impact on typical indicators such as recruitment and compensation review plans.”
Salaries in the UAE were earlier forecast to increase by an average of 5 per cent this year. The cost of living in the country continued to rise in 2015, with the inflation posting a 3 per cent increase and rising cost of fuel affecting household budgets.
Considering the current inflation, the real growth in UAE employees’ spending power is a negligible 1.0 per cent, according to Hay Group.
Source: Cleofe Maceda, Senior Web Reporter, gulfnews.com