Saudi firms hike wages to control inflation
BUFFERING INFLATION Saudi Aramco has implemented a wage hike to balance the impact of rising inflation on its employees. (AP)
(December 5) - Several Saudi companies, including state-owned oil conglomerate Saudi Aramco, have decided to raise wages by 15-40 per cent to offset the impact of rising inflation on employees, al-Riyadh newspaper reported on Wednesday.
Inflation climbed to its highest in at least a decade in September, raising pressure on the world's biggest oil-exporter to heed growing discontent over prices without straining its currency peg to the dollar.
Aramco decided earlier this week to raise wages of lower-levels employees by 10 percent and agreed lesser increases for mid-level and top management, the paper said.
United Arab Emirates telephone operator Etisalat has decided to raise wages by 20-40 per cent for its 2,800 employees, the newspaper reported a company official as saying.
"This is to help employees face rising costs of living," the paper said.
The newspaper said it had seen documents showing that Saudi Investment Bank has decided boost the salaries of all employees by 15 per cent from January.
A report in September said state-controlled Saudi Basic Industries Corp. would raise wages by 6 per cent.
King Abdullah summoned officials in October to explain rising prices and a committee of his advisors called for a national wage hike, a demand that is becoming more difficult to refuse with oil prices at record highs above $98 a barrel.
Saudi Arabia raised wages in 2005 by 15 per cent, and many Saudis are holding out for another government salary hike.
The UAE, whose currency is also pegged to the tumbling dollar, said last month it would raise the salaries of federal government employees by 70 per cent as of the beginning of 2008.
The Saudi's riyal's peg at 3.75 to the dollar is seen by economists as a factor behind inflation that has hit ordinary Saudis. (REUTERS)
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