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Middle East salary survey

The SSR & Executive Profiles global salary survey, supported by ASIS International reviews more than 12, 000 security professionals (nationals and expatriate) with data gathered from multiple sectors, including; the finance sector, manufacturing, hospitality, extractives, FMCG and logistics, Andrew Hudson MSc of the recruitment firm SSR writes.

There was a big jump in consumer inflation in 2018 after the implementation of a 5 per cent value-added tax. Some economists believe that the UAE economy will slip into deflation this year following a persistent decline in housing and fuel prices and an oversupply in the retail and hospitality sectors. The UAE and Saudi Arabia levied 5 per cent VAT on a host of goods and services from January 1, 2018 as part of a GCC (Gulf Cooperation Council) framework agreed among the Gulf nations, resulting in a spike in inflation in the first few months. In January 2019 there was a drop-in price of certain major components of the inflation basket. Housing and utility prices contracted by 5.8 per cent on a year-on-year basis, rental costs have remained stable, or in some countries have reduced. The cost of transportation prices fell 6.4 per cent year-on-year on the back of the plunge in the oil price at end-of 2018. Food prices also dropped by 1.1 per cent year-on-year in January due to VAT increase being accounted for.

In 2018 salary increases for senior management roles averaged 2.9pc. Recent economic forecasts and headline forecasts of 3.9pc global growth for 2019 in the IMF’s World Economic Outlook points to uneven growth prospects, escalating trade tensions, rising oil prices and some emerging markets and developing economies being under pressure. In Africa it is predicted parity between budget increases and inflation but in Egypt the median salary increases of 12.2pc will be wiped out by an expected inflation rate of well over 15pc.

All this highlights various instabilities in the global economic landscape, yet when we look at the outlook for salary budgets, the global picture is one of continuity, with the Willis Towers Watson Salary Budget Planning Report showing budget increases for 2019 being broadly like 2018, albeit with some country exceptions. Employers should be able to keep pay competitive and provide good value to employees.

Real wage increases in 2019 are also forecast to be similar to what they were in 2018, in most sub-regions. In the Middle East, the real wage differential in 2019 will be 1.8pc.

In 2018, the Turkish lira devalued 82pc against the US dollar and 72pc against the Euro. So, while actual and projected salary budget increases in Turkey have historically shown less volatility than inflation, these adverse indicators will likely affect how organisations administer salary review practices and react to high inflationary pressures. The median salary prediction is 9pc for 2019 which will be more than eroded by an inflation rate of 10.5pc.

So how does this fit with previous discussions around salary budgeting de-coupling from traditional drivers such as inflation and unemployment? The picture from the data is mixed – both in terms of gross and real salary budget increases, and what may be driving employers’ decision-making.

Despite major economic diversification efforts, oil continues to dominate and shape the macroeconomic outlook for Middle Eastern economies with elevated oil production levels and notably higher oil prices compared to last year. The ME economy growth is forecast to rebound from an eight-year low of 0.9pc in 2017 to 2.3pc in 2018 – although growth remains below the 2010-2016 average of 3.9pc. In addition, job creation in the UAE has been quite modest this year as judged by the Emirates NBD employment index – in fact it turned into negative territory in August and September 2018, indicating a decline in jobs. But as the overall macroeconomic conditions continue to improve, the pace of job creation in 2019 will pick up.

Gender employment parity in the workplace in the Middle East is expected in 2024. In terms of tertiary education, women are outpacing men with 52pc of university places being taken up by women. Whilst Security globally has been male dominated more women are joining the industry. SSR predicts a 15pc increase in the number of women in the ME security industry this year.

We expect to see job creation and an increased need for security professionals in the region, as a result of continued infrastructure development including the nuclear power plants being built in UAE and Saudi Arabia, new cities such as NEOM in Saudi Arabia and Al Nayeem in Kuwait. Transport projects are underway across the region including railways in all six GCC countries and metro projects in Riyadh, Jeddah, Doha and Abu Dhabi. Major events are also expected to provide an economic boosts and many job opportunities, including the Expo 2020 in Dubai and the FIFA World Cup in Qatar in 2022.

The fastest growing security roles that SSR have tracked in the Middle East in the last 12 months are those in cyber security. These have also had the largest average salary increases (over 7pc) in the last two years. This is largely due to an increased demand for cyber professionals, which have traditionally been in short supply regionally with a lack of local talent. More cyber-attacks targeted at the Middle East along with the consumer shift to mobile data processing and evolving web technology, have increased demand for such professionals. We are predicting an increased level of local talent coming to market in 2019-20 through more nationals seeking qualifications in digital processing, content protection and cyber prevention.

Regional tensions have caused some business disruption and uncertainty but with time this has quietened down. Initially this had impacted businesses and caused concern, with travel being the most inconvenienced as Saudi Arabia and UAE closed their land borders and suspended air and sea travel, to and from, Qatar.

The importance of India to the Middle East and vice versa continues to grow. India has become an integral and strategic trade partner, growing from $5.5 billion of trade in 2001 to $137.7 billion by 2015. This partnership has been extremely significant in both directions. It is viewed in the West that India was just a source of qualified labour, but latest estimates predict 10.2m Indian tourists will visit the region annually from 2020.

About the author

Andrew Hudson Director is an experienced recruitment manager, working from Dubai since 2004. He has enjoyed working as a senior manager of a multi-national security company, managing their ‘in-house’ recruitment service. It soon expanded to cover a variety of sectors internationally – operating in North Africa, the Middle East and South Asia. Andrew has been involved in international project recruitment, executive search, employee outsourcing (with over 4,000 staff members on his payroll) and training services, among other things. Although Andrew has experience working within a wide range of sectors, his primary focus has always been on the security sector.

Andrew is a Fellow of the Chartered Management Institute. He has an MSc in Psychology and Criminology and holds level ‘A’ accreditation for psychometric testing. Visit www.ssr-personnel.com.


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