Middle East firms expect skills shortages
Companies anticipated to reinvent themselves and bounce back stronger.
There have been slight increases in Middle East job flows in late June but businesses generally expect a skills shortage due to a reduced number of expatriates since the start of Covid-19, a survey reveals.
Research from the Robert Walters Employer Sentiment & Hiring Survey reveals that 56 per cent of employers intend to hire in the next six months.
"It is predicted that the population of the UAE will shrink by 10-15 per cent, that is up to 1.5 million people leaving from a total population of 9.5 million. We are having similar estimates from other GCC countries. There is no furlough here, no social safety net and therefore typically companies cut deep into their workforce due to necessity and then need to rehire as the economy comes back," said Jason Grundy, managing director at Robert Walters Middle East and Africa.
"The Middle East has been through these crises before, and each time the major players have reinvented themselves and come back stronger," said Grundy.
Despite recruitment levels reducing over the last two months - anywhere from 40 per cent to 70 per cent depending on the team's specialism and industry focus - the report suggests the Middle East is in a good position to recover faster and business confidence is expected to return towards the end of the year.
Vijay Gandhi, regional director for Korn Ferry, has said new hiring is slowly picking up as more organisations are getting back physically to work and starting to fill the essential roles which were stalled pre-Covid.
"The temporary drop in base pay for three to four months for existing jobholders should end by August/September in a majority of companies. The average drop we foresee for new joiners is 15-20 per cent less than people working at the same level," he noted.
The survey found that 56 per cent of salary packages were unaffected due to Covid-19 while 49 per cent of affected professional's salary packages were decreased by 20 per cent. The survey highlights the top three skill shortages in the Middle East: Nationals with the correct industry experience, professionals with IT and digital skills and local market knowledge.
Grundy said the need for local talent continues to dominate hiring trends, and with less expats available, the rationale behind the demand may have shifted slightly. "Our survey shows that 41 per cent of employers expect there to be a technical skills shortage in the region as the need increases for local talent with the correct industry experience."
Pharma, food services, medical and hygiene product manufacturers have done well in the second quarter, while fintech and financial services clients took advantage of the market volatility, along with recession proof areas like defence and the 2030 giga-projects, the report said.
Supply chain is a good example of a vertical that has become very important during the lockdown. Some professional services divisions in private practice and management consultancies are hedged, with departments like restructuring and insolvency flat out managing the tumult, said the report.
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