GNcareers, from Gulf News

Gulf employers must mind salary gap

Gulf employers must mind salary gapImage Credit: Supplied

According to a recent survey by Hay Group, the pay gap in the Middle East has widened to show high levels of disparity between lower-level employees and senior managers. This is a dangerous signal to productivity and one day we will face a skill shortage of core jobs. The study conducted across organisations in 63 countries identified trends in pay disparity.

If we look at the stack of reports on Gulf countries, the pay disparity between senior managers and lower-level workers is relatively high and has widened significantly over the last seven years. True, industries are targeting ambitious growth and senior people have bigger roles to play. But it is a wrong HR strategy for the disparity to continue because AA employers would soon face a shortage of skilled workers.

Some employers argue that bigger pay packages are necessary for senior levels due to scarcity of resources, while the lower levels have grown at a slower pace. The demand for leadership positions and senior professionals for whom organisations are willing to pay high premiums has outstripped the impact of increasing salaries at lower levels. Income inequality has become a hot-button human resource issue in the Gulf.

The data were drawn from the consulting firm's pay report which includes data for more than 16 million job holders in 24,000 organisations in more than 110 countries. The country with the largest increase in gap was Bahrain, where senior managers now make 7.9 times what lower-level workers make, compared to the 3.6 times more they made in 2008.

Between 2008 and 2014, the pay gap between lower-level employees comprising skilled technicians, clerical and supervisory employees and senior managers in India widened from a figure of 7.7 to 11.7. This implies that senior managers are paid 11.7 times more than lower-level workers.

I suggest HR planners rationalise the pay structure of lower-level employees and fill the widening gap to avoid the scarcity of skilled workers in the future.

Handy Hints:

• Gaps account for factors like industry, education, position

• HR must monitor salaries for new hires and for promotions

• It will be helpful to complete a yearly compensation review

Here are the mentor's roles and responsibilities

Source: Dr. Pon Mohaideen Pitchai, Special to Jobs & Careers

The writer is a Dubai-based HR and Management Consultant