By Staff writer
Aon Hewitt survey of 600 firms says Kuwaiti salaries are set to increase most while Bahraini employees will see smallest rise
Salaries across the Gulf region are forecast to rise by five percent on average during 2016, according to a new survey by Aon Hewitt.
The GCC-wide poll of 600 multinational companies and locally-owned conglomerates - the largest study of its kind in the Gulf region - said the 2016 forecast was down from the 5.1 percent expected this year.
UAE firms projected a 5 percent increase in pay in 2016, up from the 4.8 percent projection made for 2015. In terms of actual increases for 2015, the UAE recorded a 4.8 percent increase.
According to the latest GCC Salary Increase Survey, GCC states have seen GDP levels drop due to weak global oil prices, with less foreign direct investment being recorded amid security concerns in the region and struggles among large economies such as Russia and China.
It said the situation, however, has clearly had a "somewhat limited effect" on firms, with most still planning to increase the salaries of their employees by a good amount next year.
The survey showed that Kuwait-based companies gave the highest salary increase projection for 2016 at 5.2 percent while companies based in Bahrain predicted the lowest increases in the Gulf region at 4.7 percent.
Qatari and Omani firms estimated five percent salary growth for 2016, lower than 2015 predictions which stood at 5.2 percent and 5.4 percent respectively.
Firms in Saudi Arabia forecast a 5.1 percent figure for 2016 - down by 0.3 percent on this year's projection. In terms of actual increases for 2015, however, Saudi Arabia recorded the highest level of actual pay rises at 5.2 percent for this year.
Robert Richter, GCC compensation survey manager, Aon Hewitt Middle East, said: "Overall the outlook for 2016 may not be as positive as recent years, but the news that employers are predicting salary increases in the 5 percent range next year should come as a comfort to employees, suggesting that there is still optimism in the market."