By Andy Sambidge
New survey shows 86% of companies plan to keep staffing levels stable in third quarter
Exporters, manufacturers and retailers are less optimistic about prospects for the third quarter of 2012 compared to Q2, according to a new survey.
The latest quarterly business survey conducted by the Department of Economic Development (DED) revealed that half of businesses in Dubai expect the third quarter to bring in increased sales and profits.
Another 20 percent of respondents said they expect to see stable sales in Q3.
For the third quarter, 86 percent of the businesses surveyed said they will retain their current employee count while 11 percent spoke of plans to increase their workforce.
Manufacturing firms continue to be the most optimistic on hiring, the DED survey said.
The survey said sales expectations are especially higher among small and medium enterprises (SMEs).
At 106 points, the composite Business Confidence Index (BCI) was lower than the level recorded for the previous quarter and well down on the 133 score seen in Q1.
The decline is an expected fallout of the summer holidays and onset of Ramadan, which businesses factor into their estimates, DED said in a statement.
Prices of most goods and services are expected to remain stable in Q3 compared to the second quarter, the survey also showed.
Sami Al Qamzi, director general of the DED, said the overall business outlook for the third quarter was largely driven by the upbeat expectations of the manufacturing sector.
Meanwhile, growing demand in overseas markets has made exporters in Dubai relatively more upbeat on sales and profitability, he added.
Within the services sector, travel, transportation and construction companies were more optimistic compared to other sub-sectors.
Around 40 percent of construction companies said they expect to win new contracts but restaurants and hotels anticipate a drop in business during Ramadan.
Competition, insufficient demand, government fees, and uncertainty on regulations remained the top challenges listed by respondents in the survey.