The Middle East’s fast-paced economies are attracting investors from all over the world but are failing to lure new professionals to work in the region.
The eighth annual Corporate Reputation Watch study by international communications consultancy Hill and Knowlton shows despite booming economies, soaring foreign direct investment and high oil prices, the Middle East is still among a group of key emerging markets which are yet to attract the best global talent.
The study found, based on what they have read or heard about the Middle East, only 20 per cent of students in the world’s MBA schools say they are interested in working in the region, compared with 57 per cent who say they are not interested in working here. However, European students are relatively more interested in working in the Middle East (32 per cent versus 20 per cent overall).
When considering some individual emerging markets, the study shows students at the European business schools see the UAE and Dubai specifically as more attractive than their peers in other parts of the world (40 per cent versus 30 per cent).
According to Dave Robinson of Hill and Knowlton Middle East, the report has highlighted a critical issue for the region. “With governments and companies in the Middle East adopting aggressive growth strategies and with the move towards international business practices, the need for the best graduate talent has never been greater. The Middle East is in the front line of the global war for talent.”
Companies need to know in the battle for talent, they must do all they can to win and their external perception is possibly the most vital weapon in their armoury. The study confirms the importance of reputation with almost three quarters (73 per cent) of MBA students stating corporate reputation plays an extremely or very important role when considering where to work after completing their MBA, with only one fifth (20 per cent) saying it is fairly important. In fact, only four per cent said reputation was not important.
The results also show significant international mobility is a key concern for students, with over three quarters (76 per cent) of those surveyed stating they are looking to change either industries or firms following graduation. Only one-fifth (19 per cent) said they are intending to return to the firm they worked for prior to their MBA. A fifth (20 per cent) of the students surveyed want to move to another country from that which they are studying, whilst one quarter (25 per cent) are studying outside of their home country and plan on staying there.
According to Robinson, corporate collapses such as Enron in the US, have made students more aware of the importance of a company’s reputation. Enron, once one of the world’s largest electricity and natural gas traders, filed for bankruptcy protection in December 2001.
“MBAs graduating in a post-Enron era have a strong preference for the companies with the best reputation. It is clear recruiters of top talent will need to provide more than just generous compensation and ample opportunity for growth. Tomorrow’s leaders are overwhelmingly seeking to associate themselves with industries, and specifically companies, with great reputation.”
The study also revealed that young MBAs are steering away from sectors such as tobacco and chemicals and turning their talents to the banking and finance sector. The most popular jobs for top MBA students are in financial services and consulting, while alcohol, tobacco, chemicals and oil and gas sectors are among the least attractive. The survey was conducted by Penn, Schoen and Berland Associates for Hill and Knowlton. Interviews were carried out in 2007 among 527 MBA students at 12 top-ranked international business schools in the United States, Europe and Asia. Students of 60 different nationalities took part in the study.
Asked on their level of interest in working in various sectors, based on industry reputations, 60 per cent of students said they were interested in banking and finance and 24 per cent said they were not interested.
The recruitment industry also witnessed a trend towards careers in the banking and finance industry. According to job website Bayt.com, the sector is drawing the top talent in the world.
“Financial incentives, opportunities for learning and development and growth potential have made the financial services sector a magnet for top talent from around the globe, especially as this sector has grown in maturity, sophistication and global competitiveness and emerged as a key engine of economic growth and diversification in the GCC,” Lama Ataya, marketing and corporate communications director, Bayt.com, told Emirates Business.
A Bayt.com poll last year listed banking and finance as one of the top industries people would choose if they could change careers.
“In a July 2007 online poll of 3,481 registered Bayt.com users 32 per cent of respondents said if they could reinvent their professional role they would choose to be in the banking and finance industry, which scored a significantly higher overall popularity rating than any of the other industries. IT was next in line, followed by tourism and hospitality and then medical and health services,” said Ataya.
In the Corporate Reputation Watch study, the second most popular industry was also information technology, with 39 per cent of students interested. The next most popular industry was energy utilities, with 38 per cent of students interested. The pharmaceutical industry is in the state where it puts off slightly more students than it attracts, with 31 per cent of students interested and 39 per cent not interested.
For multi-billion dollar industries such as alcohol, chemicals and tobacco, more than double the number of MBA students are not interested in working in them than those who are – alcohol (51 per cent versus 20 per cent) and chemicals (48 per cent versus 19 per cent). Tobacco was the least popular sector of all, with 67 per cent of students not interested and 13 per cent interested.
The oil and gas industry, one of the key industries in the GCC, was not a popular choice for the students, with 32 per cent interested in the sector and 39 per cent not in favour of it. Their response could explain why only one-fifth of the students are interested in working in the Middle East.
The survey also asked students about their preferences for a company’s ownership. By far the most attractive companies for MBA graduates are those that are publicly traded with almost two-thirds (61 per cent) citing interest and only six per cent saying they are not interested. Firms that are owned by venture capital or private equity funds have just over half of MBA students (52 per cent) expressing an interest in working for them as against 12 per cent of those interested. The situation for family – comparatively common in the Middle East – is less positive.
Employee career opportunities were the number one factor for MBA students when considering where to work after graduating, while environmental concerns were pushed to the bottom of the list.
According to the eighth annual Corporate Reputation Watch study, conducted by Penn, Schoen & Berland and commissioned by Hill & Knowlton, 58 per cent of MBA students consider career opportunities as extremely important, followed by corporate culture and their working environment – 38 per cent.
Salary was the third most important factor, with 36 per cent saying they considered employee compensation and benefits package as extremely important.
The least important factors were the company’s brand and marketing message (12 per cent) and the environmental/green policy (eight per cent).
Employee talent was the top concern for MBA students when assessing a firm’s reputation, while social responsibility was the second most important item.
According to the study, 43 per cent of students believe employee talent is an important attribute in assessing a company’s reputation, followed by the quality of products and services (42 per cent) and management quality (41 per cent).
The least important factors were the firm’s commitment to improving the sector’s reputation (32 per cent), the size of the firm and its global importance (23 per cent).
Mideast a low priority for new MBAs