UAE salaries are set to grow at a faster pace than living costs in 2024, with global human capital consultancy Mercer predicting a 4.1% average salary increase, exceeding the 2.3% inflation rate, Khaleej Times reports, citing data from the Mercer Middle East Total Remuneration Survey for the current year.

Sector breakdown: The survey indicates a 4.3% salary increase for employees in energy companies this year. Staff at consumer goods firms are expected to receive a 4.1% remuneration bump on average, while life sciences and tech companies are planning to raise salaries by around 4%, according to the survey.

That tracks with other pundits’ forecasts: GCC HR advisory firm Cooper Fitch expects salaries to jump 4.5% y-o-y this year, as the non-oil sector continues to strengthen and OPEC+ oil production increases.

Hiring plans: Mercer’s data also shows that 16.3% of UAE companies intend to grow their workforce, while 7.8% plan workforce reductions in 2024. Some 3.8% of companies in the UAE anticipate a rise in their turnover rate for 2024, while 11.4% expect their staff to stay put. Cooper Fitch’s report had seen more than half of respondents report plans to expand their workforce.

Cost of living is still a concern, especially in light of an increase in rental prices: The inflow of foreign workers post-pandemic has led to a surge in rent prices in the UAE, Mercer principal of careers in the MENA region Andrew El Zein said. He highlighted the stable job market in the UAE but expressed concern over the escalating cost of living, particularly the surge in rents over the past few years. The Real Estate Regulatory Authority’s recently adjusted rent calculator, which allows landlords to charge higher rents, also has the potential to impact employees financially.

UAE firms are facing heightened competition to attract skilled workers locally and regionally, El Zein added. To retain talent, companies are implementing various long-term and short-term incentive programs. Emiratisation initiatives, especially targeting Emirati women, are also a focus for private sector organizations.

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