Over a quarter of all workers in Abu Dhabi and Dubai expect to receive housing allowance increases in the coming year, according to a survey conducted by global human resources consultants Mercer.
The company has just published the findings of its Spot Survey on Housing Allowance Increase in UAE, with 147 organisations in the two emirates polled for their employee benefit intentions over the next 12 months.
The average forecasted increase for 2014 across organisations that are planning to increase their housing allowances is 9.8 percent in Dubai and 9.5 percent in Abu Dhabi, Mercer said in a statement.
It added that last year saw 15 percent of the Abu Dhabi companies giving increases, with 25 percent of those in Dubai raising their accommodation remuneration.
According to the responses received, 24 percent of companies in Abu Dhabi intend to raise the housing allowance for their employees this year, with 41 percent of companies in Dubai reporting the same aim.
Of the 90 companies responding to an enquiry about which employees would qualify, those in the capital indicated that 91 percent of their workforce would benefit, with Dubai-based organisations saying that it would apply to 82 percent of their employees.
The figures suggest that 22 percent of workers in Abu Dhabi and 33 percent of those in Dubai can expect a housing allowance increase this year – 28 percent of employees in the two emirates combined.
“Our Spot Survey on Housing Allowance Increase in UAE revealed some interesting employee housing allowance intentions from the companies that participated,” said Nuno Gomes, information solutions business leader Middle East, Mercer.
“Almost one in four workers in Abu Dhabi look set to receive a rise in their accommodation allowance, with one in three Dubai employees likely to receive an increase.
“I would venture that the well-reported rise in Dubai rents is the reason why companies there are considering an increase. Rental rates in Abu Dhabi have remained stable in comparison, at least for the past 12 to 18 months, so organisations in the capital are not under the same pressure to raise their housing allowance,” he added.
“Although various reports point to steep rental increases in Dubai over the last two years, at rates of 15 to 30 percent per year depending on the locations, organizations are still reacting moderately and cautiously to these market increases,” said Gomes.
“Organisations in the UAE are now starting to face issues attracting and retaining talent due to the rise in living costs across the country, with the higher rental increases seen in Dubai leading to the city’s Expo 2020 win,” he added.
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