The UAE – and particularly Dubai – is going from strength to strength, with business booming and expats coming to the country in droves. Overall, it is a positive picture, but there are still factors preventing businesses from attracting and retaining the global and local talent they need.
Our 2024 Salary Guide analyses starting salaries across more than 100 professional services roles in the UAE, within the finance and accounting, financial services, IT and technology, HR and legal sectors. The salary guide also combines insights from our recruitment team in the region with research amongst employees, revealing the trends that are affecting the job market, and are likely to continue doing so as we move into 2024.
Influx of expats is a boon for business, but job-switching creates instability
There are currently large numbers of expats relocating to the UAE – many of whom are yet to find a role. Candidates are determined to come to Dubai to take advantage of the weather and lifestyle and escape from the less-than-ideal conditions in Europe and the US. More jobseekers mean that the market is less competitive for employers, keeping salaries down.
However, seven in 10 (69%) employees in the UAE are planning to leave their roles in the next eight months – before the end of H2 2024 – which means employers are likely to be facing high levels of workforce churn in the months ahead.
Salaries rising behind inflation
The rising cost of living in the UAE is no secret, and with salaries increasing behind the rate of inflation many employees are feeling the pinch. Across all sectors, starting salaries have increased by 2 per cent, while in August inflation hit 2.3 per cent. After years of high inflation, employees are now having to make sacrifices in order to make ends meet.
In fact, for many, the squeeze on their finances has become so bad that they are looking for a new role that will enable them to meet their obligations. Nearly half (46%) of those looking for a new role cite the rising cost of living as their primary reason to move on.
To retain talent, businesses are deploying a range of tactics, from increasing salaries and allowances to offering additional bonuses or adding benefits to their package, but it is not always enough to keep talent on board – especially when average prices for housing and accommodation prices have increased by 17 per cent year on year.
Focus on talent management drives up HR salaries
Despite the candidate-rich market, the right candidates can be hard to come by and even harder to keep. Many businesses are looking to bolster their talent management teams, leading to a 4.4 per cent increase in starting salaries across the HR sector – more than double the average across all professional services roles.
Packages on offer are not always enough to secure the skills needed to succeed, especially in mid-size organisations. As a result, compensation and benefits experts are able to command some of the highest salaries in the sector – with starting salaries up 8.4 per cent year-on-year – as leaders attempt to find solutions that work for their business and their employees.
What is the outlook for the year ahead?
While jobseekers continue to emigrate to the UAE without roles, low levels of competition will keep salaries down for new hires, despite rising cost of living. Signs from across the pond suggest that inflation will start to slow, but candidates will need to manage their expectations as they may no longer be able to command the sizeable salary increases, they could in the past.
Employees are already cutting back, and employers should consider what additional support and perks and benefits they can offer to ease the financial squeeze. Salary increases and boosts to living allowances will help with retaining talent, but they will likely come at the expense of packages for new starters, making it harder for UAE hirers to attract the best talent on the global market.