By Lubna Hamdan
Saudi salaries set to increase 4.5% in 2020: survey, according to global consultancy Mercer
Base salaries will increase by 4.5 percent in Saudi Arabia by 2020, according to the annual Total Remuneration Survey (TRS) by global consultancy Mercer, which surveyed over 470 companies in the kingdom in sectors ranging from manufacturing to retail and high tech.
Over half of the employers surveyed also said they intend to increase their headcount next year.
The life sciences industries will see the highest increase at 5 percent, while the energy sector will see a lower increase of 3.5 percent compared to a 3 percent rise in 2019. The research also found that companies are providing higher increases to senior executives compared to other employees.
Basem Samara, Career Products Leader at Mercer in Saudi Arabia said the findings are encouraging and show that more Saudi nationals are being placed in leadership positions.
"This is a reflection of a resilient and optimistic economy. Saudi is constantly looking at new approaches to further progress and develop the workforce. In addition to annual increases in base salary, we have noticed an increasing number of talented Saudi youth being placed in leadership positions. This is key in creating a sustainable economy,” he said.
Unemployment rates continue to drop in Saudi in line with a growing GDP, with voluntary turnover rates having increased from nearly 7 percent in 2018 to 9 percent this year, the surveyed showed, while 52 percent of respondents said they are looking to increase their headcount and 38 percent are looking to maintain it in 2020.
Samara added that organisations must tailor employment opportunities to Saudi Arabia’s young demographic as the market is witnessing fierce competition when it comes to retaining talent.
"We are seeing that leaders of many organisations are looking to enhance the employee experience as a retention tactic given the fierce competition for talent in the market. The contractual agreement between employers and employees will always have a significant weight, however, this is no longer sufficient. Employers must consider how they are perceived by their employees as an enabler to fulfill their professional and personal ambitions. This is crucial in keeping young talent engaged and motivated and will play a role in driving performance,” he said.