UAE: Salaries up 3.6% in 2021, higher increases likely in 2022

Hiring is rising due to the promising economic recovery experienced in the country


Waheed Abbas

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Photo: File
Photo: File

Published: Tue 9 Nov 2021, 1:04 PM

The UAE companies on average increased salary by around 3.6 per cent in 2021, slightly below 2019 and 2020 levels of 4.5 per cent and 3.8 per cent, respectively, says a new survey,

According to Mercer’s 2021 Total Remuneration Survey (TRS) report, only five per cent of companies to freeze salaries in 2022 as compared to 10 per cent this year and 14 per cent last year as the economy recovers and companies intend to hire and retain skilled employees

The study is based on research of 599 companies in the UAE.

As the jobs sector recover from the bout of the Covid-19 pandemic, many UAE companies forecast a higher wage increase to attract and retain top talent, according to a new study released on Tuesday.

The survey found that hiring is rising due to the promising economic recovery experienced in the UAE with companies reporting an intention to hire for more new roles than in 2020.

Local companies are increasing their focus on long term incentives plans, particularly for executives and those with experience in specialised fields. A key benefit that employees are seeking is that of flexible working, which has been in demand globally.

“Signs of growth abound and are evident in the increased hiring activity that we have seen in 2021 and the positive forecast for 2022. Employers are prioritising hires for in-demand skillsets that will support future business growth, however, the talent pool is still developing, causing somewhat of a talent war. To attract and retain top talent, employers must look to maintain pace with market-wide salary growth and benefits,” said Andrew El Zein, associate, career, Mena at Mercer.


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Higher wage increases in 2022

He said optimism is strong when looking at 2022 with many UAE companies forecasting a higher wage increase in order to attract and retain top talent, particularly in competitive fields.

The study found that life sciences and consumers goods sectors will lead salary increase at four per cent while technology and energy sectors are lagging at 3.5 per cent and 3.4 per cent, respectively.

“When looking to 2022, there are clear signs of economic optimism with respondents suggesting that we see an annual increase aligned to pre-pandemic levels with all industries expected to average a four per cent increase. For 2022, industries that will be aligned to the 4% increase include high-tech, life science, and consumer goods. Conversely, energy salary increases are expected to be slightly lower at 3.8 per cent,” it said.

Ted Raffoul, career products leader for Mena at Mercer, said the survey shows positive sentiment toward hiring trends and salary increases although not quite at pre-pandemic levels. “Companies must focus on continuing to provide flexible working models to employees in order maintain a strong proposition as an employer,” he said.

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