In a positive turn of events for the UAE job market, a recent survey conducted by Cooper Fitch suggests that a significant portion of companies in the region are gearing up to boost salaries in the upcoming year. Released on Wednesday, the “Salary Guide UAE 2024” report sheds light on the salary projections for 2024, indicating a promising outlook fueled by the robust performance of non-oil sectors and genuine estate.
Anticipated Salary Growth
According to the report, 53 percent of companies are poised to raise their employees’ salaries in 2024. Delving further into the details, approximately 39 percent of these firms are planning modest increases of up to 5 percent. Furthermore, nearly one in ten companies aim for a salary hike between 6 to 9 percent, while 5 percent of organizations are gearing up for substantial increases of 10 percent or more.
However, in a somewhat unexpected twist, the report reveals that 21% of companies anticipate lowering salaries in the coming year. This trend is surprising, considering the heightened demand for top-tier talent in the job market. Meanwhile, over a quarter of surveyed companies have no immediate plans to revise their employees’ wages, as highlighted by Cooper Fitch.
Economic Landscape and Sectoral Trends
The report projects a moderation in the UAE’s economic growth, anticipating a shift from the previous year’s 7.9 percent to nearly three percent in 2024. Despite this moderation, non-oil sectors such as real estate, travel and tourism, and aviation are expected to spearhead the country’s economic growth.
Reflections on 2023 Salaries
Looking back at 2023, the Cooper Fitch survey indicates that 81 percent of firms either increased or maintained their employees’ salaries. Over half of these companies (54 percent) opted for salary hikes, illustrating a sustained demand for talent in the UAE job market. Notably, approximately 8% of companies committed to talent retention by implementing salary increases exceeding 10%.
In addition to salary increments, the survey sheds light on annual bonus trends in the UAE job market. Seventy-one percent of companies plan to issue yearly bonuses based on their financial performance in 2023, indicating a positive trend in recognizing and rewarding employee contributions.
Among the companies intending to issue bonuses, 35 percent plan to pay one month’s basic salary, while 17 percent are more generous, offering two months’ salary. Further breakdowns reveal that 12 percent, 4 percent, and 1 percent of companies intend to pay three, four, and five months’ basic salary, respectively. Notably, employees in sectors such as accounting, chemicals, consumer goods, and hospital and healthcare stand to receive bonuses amounting to a substantial six months’ basic salary.
However, some industries, including financial services, consulting, and IT, have indicated that they do not have plans to provide bonuses. Jack Khabbaz, managing partner and CEO of public sector advisory at Cooper Fitch, emphasized, “While salaries continue to play a crucial role in talent retention, factors beyond fixed remuneration – such as annual bonuses and the ability to work remotely – are playing an increasingly important role in the UAE’s job market.”
As we look ahead to 2024, the UAE job market seems poised for positive developments, with most companies expressing their intent to increase salaries. The intricate interplay between economic projections, sectoral trends, and bonus strategies highlights the dynamic nature of the job market in the region. With talent retention and employee satisfaction taking center stage, companies are exploring diverse avenues to stay competitive and attractive in a rapidly evolving landscape.