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UAE: Nearly half of Emiratis, expats expect salary hikes this year

Dubai - New report suggests the Covid-19 pandemic won't affect salaries in 2021.

Salaries of Emiratis were more resilient to the impacts of the Covid-19 pandemic than the expatriates in the UAE, according to the new Hays 2021 Emiratisation Salary & Employment Report released on Sunday.

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Around 64 per cent of Emiratis’ salaries remained the same in 2020 and 2021, as compared to 46 per cent of expatriates.

While looking at the negative effects of the Covid-19 pandemic on pay, 10 per cent of Emiratis had their salaries cut, as compared to 21 per cent expatriates experiencing the same misfortune.

“On average, the national workforce has been exposed to fewer pay cuts and redundancies than the rest of the UAE’s working population. However, that is not to say that it has been unaffected by market conditions,” said Samantha Wright, senior recruitment consultant of Hays Emiratisation division.

“From the survey responses, we estimate 9 per cent of UAE nationals were made redundant in 2020, and specific to pay, UAE nationals actually received fewer pay increases than other professionals working in the country in the last 12 months,” she said.

The report found 33 per cent of expatriates’ salaries to have increased in the past 12 months and 25 per cent of Emiratis received a pay rise.

“Historically, it is true that Emiratisation mandates have meant that some jobs held by Emirati professionals have been protected or exempt from some downturns in the economy, and their pay significantly higher than expat counterparts. However, this is becoming less and less the case. Instead, the disparity in pay has plateaued since the local government revised pay scales in 2019 to reflect real market rates and we expect this to continue going forward.

“While this could be viewed negatively by the local population, it has actually opened up employment opportunities for UAE nationals in the market. Particularly within private sector organisations, the hiring of Emirati talent is less of a sticking point than it has been in previous years based on company budget restrictions and we have seen job numbers increase across all industries,” said Wright.

The report found public sector organisations in Abu Dhabi to pay the highest salaries to UAE nationals – at times more than 40 per cent higher than private sector organisations.

However outside of the capital, salaries within the public and private sector are shown to be either the same or up to 10 per cent higher in Government entities.

“Historically again, it was always government entities that provided the highest salaries to Emirati professionals. However, this is becoming less common. As such, we have seen Emiratis to be more open to working for non-government entities, considering employers based on long term career development opportunities rather than just the salaries they offer,” added Wright.

Looking ahead

Around 55 per cent of Emiratis expect their salary to remain the same as in 2020, while 43 per cent expect it to increase and 2 per cent expect a decrease. Similarly, 52 per cent of expatriates expect salaries to remain stable, 45 per cent expect a pay rise and 3 per cent forsee a pay cut.

“These findings certainly reflect our own predictions. We do not expect the pandemic to negatively affect salaries further in 2021. Instead, we expect the majority of salaries to remain the same in 2021 as in 2020 with increases being paid to those hitting required performance targets, regardless of UAE national status,” said Wright.

When it comes to job numbers, around 49 per cent of UAE nationals and expatriates expect to move employers in 2021, suggesting much optimism for the number of available jobs in the local market going forward. Similarly, the report found 62 per cent of Emirati professionals to be positive about their career prospects in the next 12 months.

“Our observations of the market certainly agree with this. We've already seen job numbers increase since the turn of 2021 and we expect this trend to continue going forwards, with an added number of opportunities for UAE nationals in the private sector compared to previous years,” she added.

-waheedabbas@khaleejtimes.com