UAE wages expected to rise more than 6% this year

More than half of the Gulf's working population did not receive a pay rise in 2010, but wages are expected to increase by an average of 6.3 per cent in the UAE this year, according to a new survey.

Just 45 per cent of the 32,000 people surveyed by GulfTalent said they received a pay rise.

Employees in Qatar and Saudi Arabia had the highest average pay rises in 2010, at 6.8 per cent and 6.7 per cent. Meanwhile, The UAE and Bahrain had increases of 6.4 per cent and 5.7 per cent.

Recruitment companies say that while the wave of lay-offs that hit the region in the aftermath of the global financial crisis in 2009 and 2010 had slowed, companies were still restructuring and holding back on investing in their staff.

"Generally, things are still slow," said Charles Willson, an executive recruiter based in Dubai. "People aren't getting raises, except for in specific markets such as banking."

Mr Willson pointed to bumper earnings in the fourth quarter at banks such as National Bank of Abu Dhabi, which saw profits rise by 71 per cent compared to the year-earlier quarter.

"Bankers are getting pay rises," he said. "Beyond that, the situation is that there are still too many companies out there: ad agencies, construction companies, everything. Once we see more consolidation, then wages will pick up."

The survey found that while 61 per cent of the 1,400 companies interviewed, 61 per cent expected to hire this year while 9 per cent said they would lay off more staff.

GulfTalent said the pay increases across the region were just a fraction of the double-digit rises seen during the peak of the economic boom in 2008, but 2010 rates rose on average with inflation.