In the latest news emerging from UAE, salaries in the nation are anticipated to stay flat in spite of the rising cost of living, and businesses in the United Arab Emirates and employers are looking out to change the overall packages rather than raising compensation, according to human resources consultants.
In accordance with their new decision, employers are making efforts to make sure that their employees’ cost of living is less onerous even when salaries are static, according to Robert Half’s 2023 Salary Guide.
UAE Employers Are Planning Incentives And Allowances Instead Of Salary Increases For 2023
However, current data and projections call for some exceptions, with workers in the UAE’s legal and financial services industries expected to see average salary increases of 5% and 4.9%, respectively, in 2023, as per the same recruitment consultancy.
Banking, private equity, venture capital, insurance, investment, and family offices are the fields that are included in the financial services sector.
How much it will be reflected in the reality would be decided by the time factor and actual corporate policy decisions and implementations backed by the UAE Government.
Returning to the current situation, where a majority is going to be affected, the rising cost of living is forcing companies to review the benefits they provide and reduce overhead in order to enhance their offering. Some employers are increasing bonus payments, while others are raising housing or healthcare allowances, the agency confirmed.
Some dominant and reliable econometric models predict that in the long run, the United Arab Emirates Inflation Rate will trend around 3.50 percent in 2023.
Hence, employers are increasing regular allowances by 31%, offering high or additional bonus payments by 31%, and allowing employees to sell back annual leave days by 27% in an effort to beat inflation.
Employee Departure Predicted In 2023: Discontents High
Due to the competitive hiring market, employers should be on the lookout for a probable exodus in 2023 as 46% of workers are considering changing jobs, according to the report. According to the global HR consultancy, 28% of employees intend to look for a new job before the end of the year.
Gareth El Mettouri, the Associate Director for the Middle East, retorted that it is understandable that nearly half of employees are considering switching jobs in 2023 given the rapidly rising cost of living. Employers should take immediate action to keep their best employees if they want to take advantage of the expanding opportunities in the UAE economy.
The study found that 37% of UAE workers do not have access to benefits, 36% do not have opportunities for career advancement or training, and 39% say their pay is below average or not competitive. Additionally, 56% of workers in the UAE are looking for new employment because they need a higher salary to meet their obligations.
Currently, it was reported that 52% of workers have noticed a rise in coworkers leaving their company, which corresponds with a decline in employee satisfaction.
However, as business confidence rises in the first three quarters of the fiscal year, employers are hiring to fill both vacant positions and recently created positions.
Senior Professional Opportunities On The Decline
For junior and mid-level candidates, the job market in the UAE is booming, but senior professionals have fewer opportunities, according to Robert Half.
According to its most recent report, many organizations are choosing to promote from within rather than hire new talent at the highest levels of the organization.
Because there is a shortage of qualified candidates in the UAE compared to business demand, employers can retain highly skilled workers by offering.