UAE staff set for 7% pay rise in 2010 - survey

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MONEY MATTERS: A new survey says UAE employees can expect an average salary rise of about 7 percent in 2010.

MONEY MATTERS: A new survey says UAE employees can expect an average salary rise of about 7 percent in 2010.

Employee salaries in the UAE are predicted to rise by up to 7.5 percent in 2010, according to a new survey of more than 100 companies.

The survey from the global HR consulting firm Mercer revealed that most firms (90 percent) said they will be raising salaries in 2010.

The Total Remuneration Survey (UAE) of more than 100 firms with close to 23,000 employees said base salaries will increase by between 7 and 7.5 percent in 2010.

The survey findings also highlighted the unpredictability of the past 12 months.

In mid-2008, firms said they were forecasting 2009 salary rises of close to 10 percent. Yet in fact, firms reported that base pay across the UAE rose by an average 3.4-5.2 percent during the year.

“Although the rises reported in 2009 were less than expected, the fact that many companies are planning to increase salaries by over seven per cent during 2010 is extremely promising for the region,” said Bassam Gazal, head of Mercer’s survey practice in the Middle East.

The UAE results compared well against a range of base salaries worldwide during 2009, most of which showed only marginal growth, Mercer added.

The survey also showed that Abu Dhabi’s housing allowances were significantly higher during 2009 compared to Dubai, while executive remuneration packages tended to be higher in local firms than in multinationals.

Total remuneration packages were higher across all levels in Abu Dhabi in 2009 compared to Dubai, the survey added.

Demand for UAE nationals continued to outstrip supply and employers continued to pay a market premium for their services, it said.

The survey also provided further evidence of a trend of companies moving to increase the variable component of salary packages, with increases in the target bonus and maximum bonus as a proportion of the remuneration mix.

“Our clients want to link reward to performance more closely than in the past, and that means changing the way bonuses are issued,” added Gazal.

Mercer’s results also reinforced earlier indicators that a mood of “cautious optimism” continued to gain momentum as employers plan for 2010.

Close to two-thirds of survey respondents said they were planning to increase headcount during 2010, while the remainder (39 percent) said headcount levels would stay as the same.

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Posted by: fatihermihan

In addition to the correct comments above, I would like to add that, nowadays people are more afraid of the future, because there is no positive sign regarding high economical values that the specialists are talking about for 2010. People wish to keep their job stable, nobody expects any increase. Even though some companies decreased the salaries, people had to stay and to accept the condition, because there was no more option in the market. So, who is saying the the truth? Who will bring up the realistic survey?

Posted by: Copyranter

wow! I really can't believe that this is supposed to be objective journalism... So far this morning, I've read a story about Deyaar losing 20% of their workforce. Then I move on to another story about Mashreq Bank claiming it has seen an unprecedented amount of expats skipping the country without paying their debts. I then move on to a column piece where Anil talks to us about a company that has cheated people out of one year of rent in Discovery Gardens and now I come to this story where I'm told that business is great and we are all expected to get a 7% increase in salary by 2010. News Flash... A salary raise is usually tied to performance of the individual and performance of the company in relation to the economy. Now while, the lot of you may work hard and may deserve a raise, I highly doubt many companies will be dishing out raises to its employees due to the current situation. Where did you get your information from, a cereal box? The fact of the matter is, that jobs are still unstable, expats are still getting fired and we are not out of recession yet and will not be for quite some time. Two things to consider: Dubai will probably be the last to get out of recession due to its arrogance and inability to cope with reality. Learning to accept the problem at hand is the first step to recovery, however our very own media outlets cannot grasp this simple conclusion. Secondly, in order to secure salary raises, companies need to be generating enough profit that secures this type of revenue. Most companies in the UAE don't even know whether they're are coming or going, how are they going to be raising the pay grade when they can't even raise the standards of their business due to so many economic complications? I read this paper every morning to get an objective report on business news in the region, not to read a "feel good" piece that some undergrad wrote because he saw "more traffic" on Sheikh Zayad Road and assumed business is back to normal. If I wanted to feel good, I would've booked a massage at H20. Come on Arabian Business, you're better than this. Wake up! You missed the snooze alarm a long time ago.

Posted by: Ahmed Atif

I really agree with Billy's comments, this sort of surveys are just to make people fool, what if there no increase what steps this HR company Mercer is going to take? nothing. Management at UAE based companies have habit of painting rosy pictures about salary. If Mercer is not aware of that, i believe they have seriously think of their business. Arabian business should understand their own responsibility and not to publish such hogwash reports, where by people loosing the faith and creditability of AB's ability to provide true information.

Posted by: Billy

Yet another absolutely irrelevant and unrealistic survey. When are these people going to get a grip on what is really happening. Salaries for the vast majority of people will not increase and in many cases they will be lucky if they do not decrease in 2010. There will be more lay offs in Q4 2009 and even some in Q1 2010. We are not out of the recession yet. Things may have stopped getting worse but business for most companies is still uncertain and at a low level. Accept it, deal with it and stop all this hogwash about salary increases. All it does is dampen the spirits of the majority of people who are trying to cope in the real world.

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