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Tue 26 Aug 2008 03:32 PM

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Salary survey reveals lack of staff loyalty

EXCLUSIVE: Gulf jobs market 'extremely transient' despite 15% rise in wages.

Loyalty among employees working in the Gulf region is eroding even though salaries are on the increase.

That's one of the key findings of UK-based MacDonald & Co's annual Middle East Salary Survey for 2008, the full findings of which will be revealed at the Cityscape Dubai 2008 event in October.

Matthew Taylor, international director of the recruitment firm, said the survey revealed a lack of loyalty in the market, dubbing the environment as “extremely transient” for recruitment.

Companies, however, have started addressing the issue, he added.

“We’ve seen, over the past 12 months, a real shift in thinking from a client’s perspective. Companies are trying to retain their staff, keep their good people, conduct quarterly salary reviews, and work out what people’s long-term objectives are and try to facilitate them,” he said.

The limited pool of talented professionals in the real estate and property sector is driving companies to focus on staff retention, according to Taylor.

Additionally, the stagnant property markets in the US, UK and Europe are pushing a wave of professionals towards this part of the world and not just for financial reasons.

The results of the survey also indicated a healthy rise in salaries across the region.

“On last year’s survey we found the percentage of salary increases in the region around 15%. We anticipate such an increase, if not more, this year,” Taylor added.

The survey is conducted at a time when inflation across the GCC hit its highest level in two decades. Populations of the six GCC states, bar Kuwait, which peg their currencies to the dollar, have been battling with rising fuel and food prices.

“Looking at how the markets are going, inflation in the country (UAE) and the cost of living going up all the time, salaries become extremely important,” he said.

“The markets in the UK, Europe and the States are so tight at the moment. Twelve months ago people had to be enticed to come to this part of the world. They are now looking to come here a lot more. They are now looking at career progression but also security which is not necessarily there back in the west at the moment,” he said.

Taylor had noticed a significant increase in applications from the US, especially over the last six months. He said the difference between this year and the last is “incredible”.

“They are in a lot of trouble in the US especially in the construction sector. House builders over there are clearly not building, banks aren’t lending them the cash to support these projects and it’s grinding to a halt,” he said.

On the other hand, Dubai has marketed itself effectively to the world, according to Taylor.

“People now know what’s going on whereas three years ago it was still below the radar to a certain extent. The region is booming within the construction sector so as part of [Western] people’s livelihood they have started looking further afield,” he said.

On the flip side, clients have become more selective nowadays, Taylor noted. Purely playing the card of Western citizenship does not guarantee a job offer anymore.

Local experience has become a highly-valued asset especially in fields of project delivery, project management, quantity surveying, and costing of a project. Nine times out of 10, companies will opt for people with local experience, according to Taylor.

“Although people in the West are now looking to come here they are not always successful. It’s not a case of sticking your hand up and saying I’m from the west and getting ten job offers. Not anymore. Five years ago it was the case, not anymore,” he said.

The real shortage is in people with local experience, according to Taylor, which is why salaries are going up considerably.

“There’s such a premium placed on people with local experience that maybe we’ll see it shifting again and clients preferring to pay half the salary to someone without the local experience but asking for half the money,” he said.

The average salary for senior professionals working with one of the region’s giant developers could range between $16,000 to $25,000 per month, said Taylor.

“There’s a big discrepancy there and depends on particular companies,” he added.

Taylor also predicted salaries in Abu Dhabi, the UAE’s capital, to go up within the next two years due to rising housing and living costs, coupled with a shortage in housing units.

“There’s no supply coming online for another two years, at least not any significant supply. Salaries will have to go up or it will grind to a plateau,” he added.

The survey also covers salary increases, bonuses, benefits packages, and holidays.

It will look into salaries levels for specific roles within companies and differentials between different countries in the region and also look into employee reasons for leaving their companies and their current job satisfaction levels.

MacDonald & Co. has been operating in the UK for 14 years and had set up its Middle East office in Dubai two years ago.

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angelo 12 years ago

Loyalty is kindred to many agreements with two parties - it has to be worked at by both. Some start with companies with the best intentions only to find that the company has been lenient with the truth regarding their true role. The atmosphere in some establishments make it difficult to ask for recognition for good performance and will be held in a menial position though carrying out higher positional tasks - their only answer - move - but sometimes the grass may appear greener than it actually is! as i said in the beginning companies that promise the world but don't come up with the goods. Some will come and take any job simply to enter the country then immediately start looking for jobs with higher wages - or as in many Asian cases - start their own business.

angelo 12 years ago

Further to my previous comment - In some cases persons are recruited and given a higher salary than their boss - so the employee feels dishonoured and is left to consider his position. The increase in salaries does not equate to the increase in the cost of living - Many Europeans come here for a lifestyle that they could only dream of in their own country and they wish to continue with the "Homes and Gardens" lifestyle

Gloryb 12 years ago

The question of loyalty begins with a basic premis - that the employer honours his agreements and the labour law. The current system of sponsorship ( or as some employers think - ownership) of workers is unable to shift across jobs if the conditions are not met. It also does not allow freedom for the worker to better himself if the opportunity should arise. Conversely, an employer is "stuck" with a worker who does not perform to expectation after the probationary period. When there is an open labour market, then both employers and employees benefit and employees are more likely to remain with good employers who offer fair salaries and benefits for good service

Rainigade 12 years ago

Angelo - isn't the main reason for coming to Dubai that we ALL want to live a lifestyle that is not necessarily possible back home? Yes, a few exceptions exist where senior managers are sent here for a year or two on full expat packages. But the majority of us are here to better our lives and bank balances while living in an exciting city with a booming economy and different culture. Why single out the Europeans when talking about loyalty? I dont get the point!

Mike 12 years ago

What a complete waste of space this article and by implication this survey is. It has revealed nothing new and is a blatant attempt by a company who has been in Dubai for 5 minutes to look like an expert. Solutions are what we need not limelight stealing by reiterating what other people have already said.

Nirmesh 12 years ago

Dear All, There is no point in expecting loyalty from employess in a country where almost all employers are having double standards, more-over you work for an employer with your honesty & full commitment and then one day you get a better offer then current employer is not ready to leave you, you may be threatened with BAN !!. I have personally experienced this in Dubai, after working for 2 yrs with very reputed company, exceeding my profitability targets and all expectations of management, when I got better opportunity, my current management complaint against me to Government Authorities and tried their best so that i cant work with my new employer. Thats what happened to me & till today they are following me when i have my own business here, recently I dragged one of my previous boss to police station after i complained against him for this harassment. what I mean to say is, there is no point being loyal to companies at least in this part of world.