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Tue 17 Apr 2018 02:03 PM

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Revealed: why UAE residents are losing confidence in their finances

yallacompare survey reveals fears over cost of living rises and job security

Revealed: why UAE residents are losing confidence in their finances
(Photo for illustrative purposes only)

Almost half of UAE residents are less confident about their financial health than they were 12 months ago, according to a new survey.

The quarterly Consumer Confidence Tracker from yallacompare, the Middle East comparison site, revealed that 42.9 percent of UAE residents are less confident about their financial health, with just 19.3 percent more confident than they were in Q1 2017.

Despite this, only 24.4 percent are more likely to leave the country as a result of their financial health over the last 12 months, and 42.2 percent are less likely to leave the country for the same reason.

This suggests that, while confidence may be falling, UAE expats remain more confident about their prospects in the UAE than in their home countries, the survey said.

The Q1 2018 tracker is based on a survey of 1,441 UAE residents.

“Our Consumer Confidence Tracker shows that, while consumer confidence may not be particularly high right now, UAE residents still see the country as a place of opportunity. What’s more, the tracker shows that, while UAE residents may worry about their prospects, most appear to be taking steps to improve their financial health,” said Jonathan Rawling, CFO of yallacompare.

“A series of indicators on the tracker show a general lack of confidence around job security, the ability to keep up with the cost of living, and the prospect of a salary raise. This means that UAE residents are now allocating their resources differently, based on their confidence levels.”

In terms of the indicators, 37.3 percent said they are worried they will be unable to get by as the cost of living rises, while 53.3 percent are slightly worried. Just 8 percent report to not be worried at all.

UAE consumers are also less confident about keeping their jobs compared to the previous quarter, with 26.9 percent of people worried about job security for the coming 12 months. Year-on-year, 38.3 percent of people feel less secure in their job than they did this time last year.

Slightly fewer people now expect a salary raise in 2018 than in the fourth quarter of 2017 – 60.7 percent compared to 62.3 percent while 15.9 percent expect a pay cut over the next 12 months.

The tracker did reveal, however, that the worst fears around the implementation of VAT have not been realised. Only 12 percent of people feel that the impact of VAT has been such that they’re now struggling to make ends meet. This compares to Q4 2017 - prior to the launch - when 44.6 percent of people were worried that the implementation of VAT. 

The survey also suggested that UAE residents are sending less money home than they were last year while nearly 60 percent said they are saving less than they were last year.

For the first quarter of 2018, 42.4 percent claimed to have less credit card debt than they did at the same time last year, and 46.8 percent of people have less loan debt than they did last year.

Elsewhere, of those who pay school fees, 81.6 percent of UAE residents said they have seen an increase in fees and 54.1 percent of parents said they would consider sending their child to a different school in order to save money on fees.

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