Salaries in UAE to rise 5.1% in 2013, says survey

Banking sector offered highest salary increase of 8.1%

There will be an average salary increase of 5.1 per cent in 2013 for employees in the UAE, according to a survey based on the input of 174 UAE companies.

The majority of organizations in the UAE gave salary increases based on employee performance, with pharmaceutical and chemical sectors giving a 5.8 per cent increase while the machinery and equipment sector gave only a 4.1 per cent increase. Among the professional services sector, banks have provided the highest salary increase at 8.1 per cent while lowest increase was given by transportation, logistics and shipping services at only 2.5 per cent.

Aon Hewitt, the global human resources business of Aon, on Tuesday announced the results of its annual Middle East Salary Increase Survey 2012. The report is based on inputs from a robust comparator group of over 500 organizations from 26 sectors in the Middle East.

Aon Hewitt has been conducting the survey on an annual basis across the globe for 36 years and launched it in the Middle East for the first time in 2009. The survey is conducted in 9 countries in the region, including: Bahrain, Egypt, Jordan, Kuwait, Lebanon, Oman, Qatar, Saudi Arabia and UAE.

In the GCC, an average salary increase of 5.4 per cent was projected for 2013, the same as the projection made in 2011 for 2012, indicating that organizations continue to show confidence in the economic stability of the region. A 6.08 per cent salary increase was projected in 2013 for the Middle East as a whole and an average increase of 5.4 per cent for the GCC, the same as the projection made in 2011 for 2012.

Martin McGuigan, Head of Reward Consulting, Aon Hewitt Middle East said: “All macro-indicators have shown that the economic scenario continues to move in a positive direction with corporates continuing to show confidence in the 2013 economic outlook. At large, there are no further reductions in the salary increase projections for the next year which is good news for employees. We have also observed that organizations have increasingly been linking salary increases to performance, which is a healthy trend and indicates the increasing maturity level of the market.”

The report also highlights that fewer organizations in the Middle East are thinking about salary freezes. Only 1.3 per cent of organizations in UAE have projected a salary freeze in 2013 compared to 4.1 per cent in 2012. The major exception to this trend is Qatar where at least 8 per cent of organizations have projected a salary freeze in 2013 against 2.4 per cent who froze salaries during 2012. This may be attributed to the high salary increase given to Qatari National employees in 2011, with organizations now trying to induce market competitiveness to normalize the impact.

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