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Cost of living in region outstrips pay increases

The online survey, conducted by Bayt.com in conjunction with market research specialists YouGovSiraj, found that employees in the UAE and Qatar were the highest paid in the region last year. Qatar, the UAE and Bahrain also enjoyed the highest annual pay rises in the region, with Qatar averaging 16 per cent a year and the UAE and Bahrain averaging 17 per cent each. This compares to 12 per cent in Saudi Arabia, the region's lowest average.

Across the GCC and across sectors, salary hikes were far outstripped by perceived cost of living increases. The disparity was most pronounced in Qatar, with a perceived average cost of living spike of 38 per cent, 22 per cent higher than salary increases. In Dubai, living expenses were alleged to have risen by 37 per cent, representing a gap of 20 per cent.

The widening shortfall between salary increases and the cost of living has led many to consider dramatic steps. In Qatar, 50 per cent of respondents said increases in household expenses have led them to consider relocating to another country or returning home. Oman came in second, with 47 per cent, while Kuwait saw the lowest numbers of professionals looking to leave the country, at 32 per cent. In the UAE, 37 per cent had thought about moving abroad.

In the UAE employers are taking the hit of this economic shortfall, with many employees considering job migration to improve finances. Forty per cent of UAE workers said rising expenses might force them to look for a better job in the same industry and 24 per cent said they would consider switching to another industry. In Saudi Arabia, corresponding figures were 45 and 19 per cent. Only 15 per cent of people in Qatar and 20 per cent in Oman said they would consider changing industries. "In terms of perceived cost of living increases and what this is doing to retention rates, the numbers are cause for concern," said Rabea Ataya, CEO, Bayt.com. "Around 70 per cent of the survey's respondents said they've held two or more jobs in the past five years. On average, people change jobs about once every two years. We also found that loyalty improved as salaries increased. Employers who do not close the gap between earnings and living expenses will have difficulty attracting and retaining people."