Want pay hike? This is what you may get…

Keeping with global sentiment, GCC pay rises in 2016 are forecasted to be the lowest in a decade, according to a new report.

Even as falling rents offer a glimmer of hope to UAE residents, employers across the region are unlikely to offer huge increments this year.

Instead, low single-digit pay hikes should be on the radar for most in the workforce, according to the latest survey by online recruitment firm GulfTalent.

This, the firm maintains, comes at a time when the cost of living in the GCC is not going down simultaneously.

“As a result, real salary increases net of inflation are expected to be... lower than in previous years,” the report states.

One source of comfort for residents is falling rents in parts of the region, in an otherwise inflationary market, the report found.

Why UAE professionals are better off

Within the region, professionals in the UAE are expected to enjoy the region’s second highest salary increase at 5.3 per cent.

Going forward, outlook of most UAE residents seems to be brighter, as per the findings released by jobs website Bayt.com in its Middle East and North Africa Consumer Confidence Index survey.

The respondents who participated in the Bayt index have a positive outlook for the next few months. Data shows 51 per cent of respondents believe that their personal financial situation will ‘improve’ in the next six months.

When it comes to cost of living in the next six months, 58 per cent of respondents expect it to increase, while 23 per cent expect the cost of living to remain the same.

Inflation will eat into pay-hikes

Besides the UAE, Gulf Talent expects employees in Saudi Arabia to get better hikes than other countries in the region at 5.9 per cent.

However, with inflation in the Kingdom forecast at 4.7 per cent in 2016, real pay rises net of inflation will average just 1.2 per cent.

Qatar is next with 4.7 per cent, followed closely by Kuwait and Oman at 4.6 and 4.4 per cent respectively.

Prospects for employees in Bahrain are the worst among the six GCC states, with the projected salary increase of 3.7 per cent matching the forecast inflation rate exactly, leaving employees with no net increase in their purchasing power, adds the report.

The research report was based on GulfTalent’s survey of 700 employers and 25,000 professionals across the six GCC states.

Drawing on its survey results, the study found that salaries across the GCC are forecast to increase at an average of just 5.2 per cent in 2016, down from 5.7 per cent in the previous year.

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