3. This report is based on in-depth research from a wide array of sources
Research Methodology
Source Participants Selection Criteria
• Professionals employed by 3,000 largest corporations in the GCC
Online Survey of 35,000
Candidates professionals • Aged 22-60 years
• Earning an annual income in the range USD 12,000 - USD 200,000
Online Survey of 2,100 • Employing 50 to 20,000 staff
Executives &
Employers • Across all major industries
HR Managers
• Mix of private sector local and international companies
Interviews with Top 60
Senior • Across all major industries
Managers
Executives • Based in the 6 GCC countries
(Saudi Arabia, Qatar, Kuwait, Bahrain, Oman, UAE)
• Relevant reports from the press and news sources across the region
News & Research
• Macro-economic sources
2
6. Gulf countries are experiencing high economic growth compared to the rest
of the world, thanks to high oil prices and government spending
Economic Growth Crude Oil Price
2008-2012 USD per Barrel
GCC Economic Growth
World Economic Growth
120
100
6.5%
5.2% 80
4.7%
4.2% 4.1%
2.7% 60
2.2%
1.4%
0.0% 40
20
-2.3%
0
2008 2009 2010 2011 2012 2009 2010 2011 2012
Forecast
Source: Economist Intelligence Unit Source: Dow Jones & Company
5
7. During 2011, Qatar and Saudi Arabia led economic growth in the Gulf, while
Bahrain saw the region’s lowest growth
Gulf Economic Overview
2011
GDP Growth Key Factors Affecting Growth Size of Economy ($bn)
Qatar 17.6% Completion of gas projects, Government spending on 179
infrastructure, 2022 World Cup preparation
Saudi Arabia 7.0% High oil price, Huge government spending programme 588
4.7% Government spending, some limited unrest 67
Oman
Kuwait 4.4% High oil price, Government spending, US troops 163
withdrawal from Iraq
UAE 3.3% High oil price, Tourism boost following Arab spring, Dubai 358
debt restructuring, Financial sector weakness
Bahrain 2.2% Domestic unrest 26
Source: Economist Intelligence Unit, GulfTalent.com Interviews
6
8. 2011 was a year of political turmoil in the Arab world
Arab World – Key Popular Movements
2011
Tunisia Syria
Lebanon’ Iraq
Bahrain
Jordan Kuwait
Qatar
Libya Egypt UAE
Saudi Arabia
Oman
Revolution / Overthrow of Government
Public Demonstrations Yemen
On-going armed conflict
7
9. GCC governments have undertaken massive wealth distribution measures
among their citizens
Pay Rise for Nationals in Public Sector Other Government Measures 2011
2011
Saudi Arabia
− $130bn subsidy programme
− SAR 2,000 per month unemployment benefit
Qatar 60-120%
− Minimum wage raised to SAR 3,000
− Large scale housing programme
UAE 35-100%
Oman
- 50,000 new jobs in public sector
Bahrain up to 37.5% - Minimum wage increased to OMR 200
- OMR 150 per month unemployment benefit
Kuwait 25%
Bahrain
- One-off grant of BHD 1,000 per family
Saudi Arabia 15% - Minimum wage increased to BHD 402
50-100 Kuwait
Oman
Omani Rial per month - One-off grant of KD 1,000 per citizen
UAE
- $2.7bn fund to provide loan assistance for low
income citizens
Source: News reports
8
11. Job creation for citizens through nationalisation of expatriate jobs continues
to be a top priority for most GCC governments
Overview of Nationalisation in Private Sector
Pressure on Employers Average Nationalisation Rate Increase in Nationalisation
% of employers reporting Nationals employed in private % of companies reporting an
nationalisation as a key human sector as % of total private increase in their nationalisation rate
resource challenge sector employment (2011) during 2011
Oman 82% 14% 36%
Saudi Arabia 78% 10% 59%
Bahrain 54% 20% 17%
Kuwait 38% 5% 27%
UAE 28% 7% 17%
Qatar 17% 1% 15%
Source: GulfTalent.com Survey of HR Managers, GCC Labour Ministries
10
12. GCC governments have historically used a range of measures to increase
employment of nationals in the private sector
GCC Nationalisation – Common Government Strategies
Targets & Limits Support & Facilitation Incentives & Enforcement
• Targets by sector (e.g. Banks, Oil • Employment fund (subsidising • Withholding visas for expat hires
and Gas, etc.) wages of newly employed nationals)
• Tax on employers for each
• Targets by job functions (e.g. HR) • Free training for nationals expatriate employee
• Job centers – putting unemployed • Public praise / reprimand
in touch with employers
Source: Press reports, HR interviews
11
13. More innovative approaches are being tried in some countries, introducing
elements of choice, competition and commercial incentive
Recent Nationalisation Initiatives
Saudisation Emiratisation
(‘Nitaqat’ – introduced June 2011) (Introduced December 2010)
• Companies within each sector are ranked by their • Companies are placed into one of 3 categories -
Saudization rate and grouped into 3 categories. according to their Emiratisation level, diversity of
nationalities and compliance with proposed minimum
• Companies in lowest ranks (‘red zone’ ) would face wage levels.
difficulties in applying for new visas or even
renewing existing visas. • Companies in lower categories pay significantly
higher government fees for their visa requirements.
• Companies in highest ranks (‘green zone’) would be
able to hire expats from companies in the ‘red zone’
without acquiring ‘no objection certificates’ (NOC).
• Zone boundaries vary by industry, and are determined
based on the average of each peer group.
12
15. Saudi Arabia leads job creation in the Gulf, while Bahrain lags the group
with almost no expansion reported
Employment by Country
Net % of firms which increased headcount
2011 2010 Observations
• Almost all Gulf countries had higher rates of job
Saudi Arabia 62% 55%
creation compared to 2010.
Oman 56% 57%
• Saudi Arabia had the highest rate of job creation
thanks to its strong economic growth and high
Kuwait 51% 25%
government spending.
Qatar 51% 45%
• Bahrain had almost no job creation in 2011
following severe political tensions in the country.
UAE 37% 22%
• UAE had a significant rise in job creation, but it was
Bahrain 8% 23% still much lower than most Gulf countries.
Source: GulfTalent.com Survey of HR Managers
14
16. Dubai’s share of regional recruitment activity has started to increase after
two years of slowdown – due to a combination of jobs growth and staff
turnover
Recruitment Volume by Location
% of vacancies advertised on GulfTalent.com *
Oman 2% 4% 3% 3%
Bahrain 6% 4% 4% 3%
4% 4%
9% 6%
Kuwait
16% 17%
Qatar 8% 14%
Saudi Arabia 14%
20% 20% 18%
UAE 13%
(excluding Dubai)
18%
21% 22%
Dubai 48%
37%
31% 31%
2008 2009 2010 2011
* Based on 68,000 vacancies advertised by employers and recruitment agencies on GulfTalent.com website over the specified period
Note: Internet penetration and prevalence of online recruitment varies across the countries
Source: GulfTalent.com
15
17. Oil & gas, healthcare and retail sectors are enjoying the largest headcount
expansion, while banking and construction fare the worst
Employment by Sector Observations
Net % of firms which increased headcount in 2011
Oil & Gas 63% • Oil & Gas had the highest rate of employment due to
expansion plans following two years of high oil price.
Healthcare 61%
Retail 60% • Healthcare also had high employment for a second year
mainly due to continued government investment.
Telecoms/IT 50%
Engineering 46% • Retail continued to enjoy high growth on the back of higher
consumer spending and net disposable income.
Travel & Hospitality 43%
Transport & Logistics 41% • Banking had one of the lowest growth rates, with some
banks announcing fresh rounds of redundancies, following
Real Estate 33%
increased worries about the Euro crisis.
Banking 28%
• Construction continued to have a low employment growth
Construction 27%
rate due to completion of old projects and lack of new ones.
Source: GulfTalent.com Survey of HR Managers
16
18. With Western countries facing high unemployment and low pay rises, Gulf
employers are finding hiring Western nationals easier than Asian candidates
Unemployment Rate in Western Countries Private Sector Pay Increase – Global Comparison
2008-2012 % 2011
11% India 12.6%
10% France
Philippines 6.7%
9%
UK
8% GCC 5.5%
Canada
7%
Australia 4.4%
6%
Australia
5% UK 3.1%
4%
US 2.7%
3%
2008 2009 2010 2011
Canada 2.7%
Source: Economist Intelligence Unit Source: Aon Hewitt, Hay Group, GulfTalent.com
17
19. The popular uprisings across the wider Middle East have had a mixed
impact on attraction and retention of talent in the Gulf
Impact of Arab Spring on Gulf Employment
Key Trends
• Nationalisation targets: Government pressure on private sector to hire more
nationals has intensified.
Employment
of Nationals • Competition for nationals: Pay hikes awarded by governments to public
sector employees, which were partly prompted by the Arab Spring, has made it
harder for the private sector to attract nationals.
• Availability of Arab expats: More Arab expatriates are available from
countries which experienced political turmoil.
Expatriate • Visa restrictions: Some Gulf governments have made it more difficult to apply
Employment for employment visas for expats from troubled countries.
• Western expats: Some employers are finding it difficult to attract Western
candidates, as they perceive the region to be unsafe following the press
coverage of the Arab spring.
18
21. The UAE and Qatar remain prime destinations for expatriates, with Saudi
Arabia in third place
Attraction of Expatriates Observations
% of GCC-based expats outside the country who wish to
relocate into it
• UAE has strengthened its position as the most
70% popular destination among Gulf-based expatriates.
60%
UAE • Qatar, which was rapidly closing the attraction gap
50% with the UAE, remains in second place and has lost
some momentum, as sentiments about the UAE
40% Qatar economy becomes more positive.
30%
• Saudi Arabia remains in third place, with its
Saudi Arabia
20% attractiveness stable, following a sharp rise in
10% Oman
popularity at the onset of the crisis.
Kuwait
Bahrain
0% • Bahrain dropped from fourth place to the bottom,
2008 2009 2010 2011
becoming the Gulf’s least attractive destination for
expatriates, following political tensions in the country.
Source: GulfTalent.com Surveys
20
22. Dubai remains by far the region’s most attractive city for expatriates
Ranking of Gulf Cities – By Attractiveness to Expatriates
% of GCC-based expats outside the city who wish to relocate into it
Overall Western Asian Arab
Expats Expats Expats
Dubai 37% 46% 35% 38%
Doha 22% 21% 20% 25%
Abu Dhabi 20% 26% 20% 17%
Jeddah 7% 3% 7% 9%
Muscat 4% 8% 4% 2%
Kuwait 3% 1% 4% 3%
Madina 3% 1% 3% 3%
Riyadh 3% 2% 3% 3%
Makkah 3% 0% 3% 2%
Dammam 2% 0% 2% 1%
Manama 2% 3% 2% 1%
Sharjah 2% 1% 2% 1%
Source: GulfTalent.com Survey
21
23. In terms of attractiveness to expatriates living within the country, the UAE
once again retains the lead position
Retention of Expatriates
% of expats within the country who wish to remain there
2012 2011 Observations
• UAE’s already high retention rate has increased further,
due to a rebound in business confidence, declining rents
UAE 81% 72%
and the country’s high level of political stability.
Kuwait 64% 59%
• Kuwait benefits from the long-term nature of its
expatriate population, with social and family ties formed
Saudi Arabia 49% 50%
over the years discouraging expats from leaving the
country.
Qatar 49% 51%
• Qatar’s retention rate remains significantly lower than
Bahrain 46% 50% UAE mainly because of laws preventing expatriates from
changing jobs.
Oman 45% 50%
• Bahrain’s retention rate has dropped for a second year,
following political tensions and slow economic growth in
the country.
Source: GulfTalent.com Survey
22
24. Abu Dhabi continues to serve as an employment hub for a portion of Dubai
residents, while Bahrain’s role as a base for working in Saudi has taken a hit
Dubai-residents working in Abu Dhabi Bahrain-residents working in Saudi Arabia
As % of all working professionals living in As % of all working professionals living in
Dubai Bahrain
5.4% 5.4% 2.2%
3.4% 1.3%
1.0% 1.1%
0.9%
1.1% 1.1%
2007 2008 2009 2010 2011 2007 2008 2009 2010 2011
Source: GulfTalent.com Surveys
23
25. Governments across the Gulf are continuing to encourage labour mobility
within their countries, through easing NOC requirements *
Domestic Labour Mobility
Country Labour Mobility Recent Developments
Bahrain NOC requirement abolished in 2009
Oman NOC requirement abolished in 2007
UAE NOC not required after completing 2 years Guide to chart
(Jan. 2011). Already removed fully for free zones.
Full labour mobility
Kuwait New sponsorship system plans to remove NOC (NOC not required)
requirement altogether, but not implemented yet
No labour mobility
Saudi Arabia NOC not required if previous employer below
(NOC fully enforced)
required nationalisation targets (June 2011)
Qatar Most strict in the Gulf. NOC fully enforced. No
indication of an imminent easing.
* No Objection Certificate – issued to expatriate employees by their employer, giving consent to the expatriate being hired by another firm
Source: Press reports, HR interviews
24
27. Average private sector salary increase in the Gulf has remained stable, but
much lower than pre-recession levels.
GCC Average Salary Increase
%, 2007- 2012
11.4%
9.0%
6.2% 6.1%
5.5% 5.6%
2007 2008 2009 2010 2011 2012
Forecast
Source: GulfTalent.com Surveys
26
28. During 2011, Oman enjoyed the highest average increase in pay, followed by
Saudi Arabia and Qatar
Private Sector Salary Increase by Country
2011 2010 Observations
• Oman had the highest salary increase in the Gulf, in
Oman 6.5% 6.4%
part driven by widespread strikes by Omani
employees and the pay hike awarded in the public
Saudi Arabia 6.0% 6.7% sector.
Qatar 5.6% 6.8% • Saudi Arabia and Qatar continued to have high
salary increases on the back of strong economic
Kuwait 5.1% 5.7% developments.
UAE 4.9% 5.2% • Bahrain had the lowest salary increase due to lower
economic growth following the political unrest.
Bahrain 4.5% 4.9%
Source: GulfTalent.com Survey
27
29. Average pay rise net of inflation, was highest in the UAE and Bahrain
Real Salary Increase by Country * Salary Rise Inflation Observations
Bahrain 4.9% 4.5% -0.4% • Despite having the lowest salary increases in the
Gulf, Bahrain and UAE enjoyed the highest
UAE 4.0% 4.9% 0.9% increases in real terms due to very low inflation
rates.
Qatar 3.7% 5.6% 1.9%
• Saudi Arabia and Kuwait had the lowest salary
6.5% 4.0%
increases in the Gulf in real terms, due to
Oman 2.5%
relatively high inflation.
Saudi Arabia 1.0% 6.0% 5.0%
Kuwait 0.4% 5.1% 4.7%
* Defined as nominal pay rise net of inflation rate
Source: GulfTalent.com Survey, Economist Intelligence Unit
28
30. HR professionals enjoyed the highest pay rise, while Administration and
Marketing had the lowest
Salary Increase by Job Category Observations
%, 2011
• HR had the highest salary increase for a second year,
HR 6.4% reflecting the rising profile and growing sophistication
of the HR role, as well as leaner HR operations
6.3%
supported by fewer staff following the crisis.
IT
• IT had one of the highest increases last year, due to
Finance 5.5%
global shortage and on-going demand for IT
professionals.
Sales 5.3%
• Admin candidates continued to have one of the
Engineering 5.3% lowest increases, as companies continue to automate
processes and seek staffing efficiencies.
Admin 4.9%
Marketing 4.6%
Source: GulfTalent.com Survey
29
31. Among sectors, Healthcare and Retail offered the highest pay rises, while
Real Estate had the lowest
Salary Increase by Industry Observations
%, 2011
Healthcare 6.4% • Healthcare had the highest salary increase, due to
increased investments by GCC governments, specifically
Retail & FMCG 6.2%
Saudi Arabia.
Telecoms & IT 5.7%
• Retail sector continued to have high salary increase in
Oil & Gas 5.7% line with strong growth in the sector, generated by high
consumer spending.
Engineering 5.6%
Construction 5.4% • Banking sector continued to suffer for a third year,
following a slow rate of recovery and fresh rounds of
Travel & Hospitality 5.1% redundancies on the back of the European debt crisis.
Transport & Logistics 5.0%
Education 4.6%
Banking 4.5%
Real Estate 4.3%
Source: GulfTalent.com Survey
30
32. Cost of living has continued to rise in Saudi Arabia, Kuwait and Oman. In
absolute terms, however, it remains low compared to UAE and Qatar
Inflation Rent for Two-bedroom Apartment
% US$ per month, 2012*
2011 2010
Abu Dhabi 1,930
Doha 1,650
Saudi Arabia 5.0% 5.4%
Dubai 1,590
Kuwait 4.7% 4.0%
Muscat 1,000
Oman 4.0% 3.2% Kuwait 960
Sharjah 910
Qatar 1.9% -2.4%
Manama 840
UAE 0.9% 0.9% Riyadh 710
Dammam 670
Bahrain -0.4% 2.0%
Jubail 670
Jeddah 670
Khobar 550
Source: Economist Intelligence Unit * Average figure. Wide variations based on location and quality
Source: GulfTalent.com Survey
31
34. Gulf salary rises during 2012 are expected to be broadly in line with 2011
Expected Average Pay Rise
%, 2012 Forecast
2012 2011 Observations
• Gulf employers generally expect similar salary
Qatar 6.4% 5.6%
increases in 2012 compared to the previous year
Saudi Arabia 6.2% 6.0% • Qatar and Saudi Arabia are expected to have the
highest increase in the Gulf and slightly higher than
Oman 5.6% 6.5% their 2011 levels, as companies expand to capitalise
on the two countries’ strong economic growth
UAE 5.1% 4.9%
• Bahrain is once again expected to have the region’s
Kuwait 4.9% 5.1% lowest salary increase in 2012 due to a stagnant
economy following domestic unrest in 2011.
Bahrain 4.5% 4.5%
Source: GulfTalent.com Survey of HR Managers
33
35. Job creation is expected to be moderately higher in 2012, with Saudi Arabia
continuing to lead
Employment Growth by Country
Net % of firms increasing headcounts
2012 2011 Observations
• All Gulf economies are expected to have higher rates
Saudi Arabia 77% 62% of job creation in 2012 compared to the previous
year.
Oman 73% 56%
• Saudi Arabia is expected to continue to have the
Kuwait 68% 51% highest rate of job creation in the Gulf, thanks to high
economic growth and government spending.
Qatar 65% 51%
• Bahrain is expected to rebound partially from a
UAE 51% 37% stagnant job market in 2011, but will continue to have
the region’s lowest rate of job creation.
Bahrain 42% 8%
Source: GulfTalent.com Survey of HR Managers
34
36. Oil & gas, retail and healthcare will continue to dominate jobs growth, while
banking and construction continue to have the lowest growth rates
Employment Growth by Sector
Net % of firms increasing headcounts
2012 2011 Observations
Oil & Gas 73% 63% • Oil & Gas is expected to have the highest expansion
in 2012 due to new projects in the sector.
Retail 72% 60%
• Retail is expected to continue growing at a high rate
Healthcare 65% 61%
due to higher net disposable income and consumer
63% 50% spending.
Telecoms & IT
Transport & Logistics 62% 41% • Banking is expected to have the lowest rate of job
creation in 2012, due to continuing credit concerns
Travel & Hospitality 62% 43%
and the Euro-zone financial crisis
Engineering 58% 46%
Real Estate 57% 33%
Construction 48% 27%
Banking 46% 28%
Source: GulfTalent.com Survey of HR Managers 35
37. A number of external uncertainties can impact the Gulf economy and labour
market during 2012
Political & Economic Uncertainties
Economic Factors Political Factors
• European debt crisis: Continuing bad news in • Arab spring: Significant uncertainty remains over the
Europe, including the possibility of a sovereign default, outcome of the conflict in Syria, the kind of
could lead to another global recession – impacting Gulf governments which are likely to emerge in place of
countries, particularly the UAE which is more exposed those that have fallen, and the extent to which
to global trade and tourism. developments in the wider Arab world will impact Gulf
countries.
• US Dollar: Given the Gulf countries’ peg to the US
Dollar, any significant fluctuations in the value of the US • Iran tensions: A possible military conflict with Iran
Dollar against other currencies could impact Gulf could have unpredictable consequences for the entire
employers’ ability to attract and retain expatriates – Middle East region including Gulf countries.
particularly from major source countries such as India.
Source: Economist Intelligent Unit, GulfTalent.com Interviews
36
39. Useful Information
Salary Rise by Country Economic Growth
% Rise in Base Salary % Real GDP Change
Country 2010 2011 2012 F† Country 2010 2011 2012 F†
Bahrain 4.9% 4.5% 4.5% Bahrain 4.5% 2.2% 3.1%
Kuwait 5.7% 5.1% 4.9% Kuwait 3.1% 4.4% 5.4%
Oman 6.4% 6.5% 5.6% Oman 5.0% 4.7% 4.5%
Qatar 6.8% 5.6% 6.4% Qatar 14.0% 17.6% 7.6%
Saudi Arabia 6.7% 6.0% 6.2% Saudi Arabia 4.1% 7.0% 4.8%
UAE 5.2% 4.9% 5.1% UAE 1.4% 3.3% 3.5%
Inflation Population (millions)
Country 2010 2011 2012 F† Country 2012
Bahrain 2.0% -0.4% 2.2% Bahrain 1.3
Kuwait 4.0% 4.7% 4.4% Kuwait 3.9
Oman 3.2% 4.0% 3.7% Oman 3.4
Qatar -2.4% 1.9% 2.1% Qatar 1.8
Saudi Arabia 5.4% 5.0% 4.3% Saudi Arabia 28.9
UAE 0.9% 0.9% 2.1% UAE 7.5
† Forecast
Source: Economist Intelligence Unit, GulfTalent.com Surveys
38
40. How GulfTalent.com can help you?
• Register for weekly job alerts
Job Opportunities • Apply to 5,000 companies and 500 recruitment agencies in the Gulf
• Build your professional CV online
• Search our database of 3 million professionals
Recruitment Solutions • Advertise your vacancies to over 1 million visitors per month.
• Send targeted emails to suitable candidates
• Free Research Reports on the Middle East employment market
HR Resources • Labour Laws of Gulf countries
• List of HR Events including conferences, seminars and training courses
• Directory of HR Service Providers
Tel: +971 4 367 2084 | Email: info@gulftalent.com | Web: www.gulftalent.com
39
