Here's how much UAE salaries will go up in 2016

Employees in the UAE can expect a salary increase of 5 per cent in 2016, which is better (but only slightly) than the 2015 average pay-hike.

According to the latest salary increase survey by Aon Hewitt, a human resources consultancy, UAE firms projected a 5 per cent increase in pay in 2016, up from the 4.8 per cent projection made for 2015.

In terms of actual increases for 2015, the UAE did record a 4.8 per cent increase, according to Aon Hewitt statistics.

For employees across all the GCC countries, the HR consultancy’s survey shows that pay-hikes will average 5 per cent in 2016, down from an anticipated 6 per cent in 2013, 5.5 per cent in 2014, and 5.1 per cent in 2015.

Among the participating GCC organisations, Kuwait-based companies gave the highest salary increase projection for 2016 at 5.2 per cent.

This is a slight decrease on 2015’s 5.3 per cent predicted raise. Kuwait’s actual salary increase figure for 2015 stands at 4.7 per cent, less than the 4.8 per cent average salary increase that UAE employees got this year.

Companies based in Bahrain predicted the lowest 2016 salary increases in the Gulf region at 4.7 per cent, which is slightly higher than last year’s predictions of 4.5 per cent. In 2015, Bahrain-based firms reported actual salary increases at 4.7 per cent.

Qatari and Omani firms, on the other hand, estimated 5 per cent salary growth for 2016, lower than 2015 predictions which stood at 5.2 per cent and 5.4 per cent, respectively. Actual salary increase figures for 2015 stand at 4.7 per cent and 4.6 per cent, respectively.

Firms in Saudi Arabia forecasted a 5.1 per cent figure for 2016 – down by 0.3 per cent on this year’s 5.4 per cent projection. In terms of actual increases for 2015, however, Saudi Arabia recorded the highest level of actual pay rises at 5.2 per cent for this year, as per the data released by Aon Hewitt.

The low pay-hikes are as a result of weak global oil prices and struggles amongst large economies such as Russia and China. The situation, however, has clearly had a somewhat limited effect on firms, with most leading employers still planning to increase the salaries of their employees by a good amount next year, the survey reads. 

“Clearly, the impact of lower oil prices can be felt across the region [but] the GCC is faring much better than other oil producing countries in the Middle East and predicted increases in compensation will also help to ease inflationary pressures on employees while markets rebound,” it adds further.

Previous reports have highlighted that despite the increase in hiring levels, employers are neither giving any substantial pay-hikes to existing employees to retain them, nor are they offering bigger amounts to entice new candidates.

According to the 2015 salary guide by recruitment firm Robert Half, the UAE employment market continues to thrive and demand for specialist occupations far outweighs supply, resulting in talent shortages across the region but pay hikes have been only customary.

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