Fewer than 3% of firms reported increased hiring in January
Businesses in the UAE saw sharp increases in output and new orders, according to data from the Emirates NBD Purchasing Manager’s Index (PMI).
According to the data, the improvement in business activity was partly due to promotions and price discounting by firms.
Selling prices were also found to have declined for eight of the nine previous months.
The PMI also indicates that fewer than 3 percent of firms reported increased hiring in January, despite improving business conditions, with some firms reported that cost-cutting measures prevented any new hires.
Emirates NBD noted that these measures were generally successful, with staff costs rising only marginally at the beginning of the year.
Additionally, purchase activity was found to be robust in January, with firms responding to growths in orders and increased output.
However, the stock of pre-production inventories declined for the second month in a row, suggesting that firms are managing their inventories more efficiently and not building up stocks in anticipation of future demand.
Optimism among companies regarding future output was found to have remained high in January, with over 68 percent of firms expecting their output to be higher in a year’s time.
Of the companies surveyed, none expected output to decrease in a year’s time.