Competition for managerial talent in the sector has led to a steep 12.8% rise in salaries
The Gulf's construction sector continues its rapid growth but is facing severe staffing challenges as too many companies compete for a limited supply of talent, according to the latest research released by GulfTalent.com.
The report entitled “Construction Sector Employment Trends” was released on the opening day of the Big5 exhibition, the region's premier construction event held annually in Dubai. [See full report ]
As more players enter the market and more large-scale developments are announced across the UAE, Qatar, Kuwait and Saudi Arabia, the supply of engineering and managerial talent is not keeping up with demand, leading to acute shortages in some areas, the study warned.
With India undergoing massive economic growth, the report said, Gulf-based companies were having difficulties attracting the quantity and quality of expertise needed to staff their projects. At the same time, some Western expatriates occupying mid-level and senior positions in the sector were reportedly leaving the region for more attractive opportunities in China.
Visa restrictions are an additional constraint on the sector. Saudi Arabia and Qatar allow only certain nationalities residence visas, while the UAE recently started enforcing restrictions on grants of visas to companies that have not met their Emiratisation targets.
Several construction firms interviewed by GulfTalent.com reported having turned down major contracts because they were already stretched and could not deploy the expertise and human resources necessary to take on additional projects.
According to the study, functions experiencing the most acute shortages include structural specialists, quantity surveyors, planning engineers, project directors, design managers, contract administrators, and urban planners.
The competition for talent is having a visible impact on compensation levels. According to GulfTalent.com, salaries for engineers and managers in the region's construction sector rose at an average rate of 12.8% over the 12-month period to August 2006, the highest increase among all sectors.
A major issue identified in GulfTalent.com's report was the six-day working week prevalent in the sector across much of the region. Several contractors reported losing professional staff to consultancies, to other sectors or to other parts of the world where they could enjoy a five-day working week. As a result, many employers have reportedly considered switching to a 5-day week. However, given the intensity of competition and the pressure to deliver projects on time and within budget, no firm can afford to be the first to instigate such a move. Privately, some employers wished for the government to impose mandatory five-day weeks to level the playing field.
The study suggested that the tightening labour market for construction professionals was forcing employers to reach out to new sources of talent such as Egypt, less experienced candidates and even fresh graduates. This in turn, was increasing the need for investment in training and development in order to bring the new recruits up to the required skill levels.
GulfTalent.com's study was based on a survey of construction professionals as well as interviews with HR managers and executives of companies active in the sector.