Introduction

Employment and job creation remain the hottest issues in the Middle East, including
in the six countries of the Gulf Cooperation Council (GCC).
This research report, produced by online recruiting firm GulfTalent.com, summarises
the status of the employment market and forecasts key trends to be expected during
2012.
Employment and Salary Trends in the Gulf is published annually since 2005 and is
the premier publication on employment trends in the Gulf region.

GulfTalent.com 2012. All rights reserved.

This report is based on in-depth research from a wide array of sources

Research Methodology
Source

Online Survey of
Candidates

Participants

Selection Criteria
Professionals employed by 3,000 largest corporations in the GCC

35,000
professionals

Aged 22-60 years

Earning an annual income in the range USD 12,000 - USD 200,000

Online Survey of
Employers

2,100
Executives &
HR Managers

Employing 50 to 20,000 staff

Across all major industries
Mix of private sector local and international companies

Interviews with Top

Managers

60
Senior
Executives

Across all major industries

Based in the 6 GCC countries
(Saudi Arabia, Qatar, Kuwait, Bahrain, Oman, UAE)

News & Research

Relevant reports from the press and news sources across the region
Macro-economic sources

Contents

Economic & Political Background................................... 4

Nationalisation........................................................................... 9

Recruitment ..............................................................................13

Mobility.......................................................................................19

Salaries & Cost of Living........................................................... 25

2012 Forecast...........................................................................32

Appendix Useful Information..................................................37

Economic & Political Background

Gulf countries are experiencing high economic growth compared to the rest
of the world, thanks to high oil prices and government spending
Economic Growth
2008-2012

Crude Oil Price

USD per Barrel

GCC Economic Growth

World Economic Growth

120
100
6.5%

5.2%

4.7%

4.2% 4.1%
2.7%
1.4%

2.2%

0.0%

80
60
40
20

-2.3%
2008

2009

0
2010

Source: Economist Intelligence Unit

2011

2012
Forecast

2009

2010

2011

2012

Source: Dow Jones & Company

During 2011, Qatar and Saudi Arabia led economic growth in the Gulf, while
Bahrain saw the regions lowest growth
Gulf Economic Overview
2011
GDP Growth

Key Factors Affecting Growth

17.6%

Qatar
7.0%

Saudi Arabia
4.7%

Oman

4.4%

Kuwait

UAE

Bahrain

3.3%

2.2%

Size of Economy ($bn)

Completion of gas projects, Government spending on

infrastructure, 2022 World Cup preparation

179

High oil price, Huge government spending programme

588

Government spending, some limited unrest

67

High oil price, Government spending, US troops

withdrawal from Iraq

163

High oil price, Tourism boost following Arab spring, Dubai

debt restructuring, Financial sector weakness

358

Domestic unrest

26

Source: Economist Intelligence Unit, GulfTalent.com Interviews

2011 was a year of political turmoil in the Arab world

Arab World Key Popular Movements
2011

Syria

Tunisia

Lebanon

Iraq
Bahrain

Jordan

Libya

Kuwait

Egypt

Qatar

UAE

Saudi Arabia
Oman
Revolution / Overthrow of Government
Public Demonstrations

Yemen

On-going armed conflict

GCC governments have undertaken massive wealth distribution measures

among their citizens
Pay Rise for Nationals in Public Sector
2011

Qatar

60-120%

UAE

35-100%

Bahrain

up to 37.5%

Kuwait

25%

Saudi Arabia

Oman

Other Government Measures 2011

15%
50-100
Omani Rial per month

Saudi Arabia
$130bn subsidy programme
SAR 2,000 per month unemployment benefit
Minimum wage raised to SAR 3,000
Large scale housing programme
Oman
- 50,000 new jobs in public sector
- Minimum wage increased to OMR 200
- OMR 150 per month unemployment benefit
Bahrain
- One-off grant of BHD 1,000 per family
- Minimum wage increased to BHD 402
Kuwait
- One-off grant of KD 1,000 per citizen
UAE
- $2.7bn fund to provide loan assistance for low
income citizens

Source: News reports

Nationalisation

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
% of employers reporting
nationalisation as a key human
resource challenge

Oman

82%

Saudi Arabia

78%

Bahrain

54%

38%

Kuwait

UAE
Qatar

Average Nationalisation Rate

Nationals employed in private
sector as % of total private
sector employment (2011)

28%

17%

Increase in Nationalisation
% of companies reporting an
increase in their nationalisation rate
during 2011

14%

36%

10%

59%

20%

17%

5%

27%

7%

17%

1%

15%

Source: GulfTalent.com Survey of HR Managers, GCC Labour Ministries

10

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

Targets by sector (e.g. Banks, Oil

and Gas, etc.)

Support & Facilitation

Incentives & Enforcement

Employment fund (subsidising

Withholding visas for expat hires

wages of newly employed nationals)

Tax on employers for each

Targets by job functions (e.g. HR)

Free training for nationals

Job centers putting unemployed

expatriate employee

Public praise / reprimand

in touch with employers

Source: Press reports, HR interviews

11

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

Saudization rate and grouped into 3 categories.
Companies in lowest ranks (red zone ) would face
difficulties in applying for new visas or even
renewing existing visas.

Companies are placed into one of 3 categories according to their Emiratisation level, diversity of
nationalities and compliance with proposed minimum
wage levels.
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

Recruitment

13

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

62%

Saudi Arabia

56%

Oman

55%

57%

Kuwait

51%

25%

Qatar

51%

45%

37%

UAE

Bahrain

8%

Observations
Almost all Gulf countries had higher rates of job
creation compared to 2010.
Saudi Arabia had the highest rate of job creation
thanks to its strong economic growth and high
government spending.
Bahrain had almost no job creation in 2011
following severe political tensions in the country.

22%

23%

UAE had a significant rise in job creation, but it was

still much lower than most Gulf countries.

Source: GulfTalent.com Survey of HR Managers

14

Dubais 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
Bahrain

2%
6%

Kuwait

9%

4%
4%
6%

Qatar

8%

14%

Saudi Arabia

14%

UAE
(excluding Dubai)

3%
4%
4%

3%
3%
4%

16%

17%

20%

20%

18%

21%

22%

31%

31%

2009

2010

13%
18%

Dubai

48%

2008

37%

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

Oil & gas, healthcare and retail sectors are enjoying the largest headcount
expansion, while banking and construction fare the worst
Employment by Sector
Net % of firms which increased headcount in 2011

63%

Oil & Gas

Healthcare

61%

Retail

60%
50%

Telecoms/IT

46%

Engineering

43%

Travel & Hospitality

41%

Transport & Logistics

Real Estate

33%

Banking

28%

Construction

27%

Observations

Oil & Gas had the highest rate of employment due to

expansion plans following two years of high oil price.
Healthcare also had high employment for a second year
mainly due to continued government investment.
Retail continued to enjoy high growth on the back of higher
consumer spending and net disposable income.
Banking had one of the lowest growth rates, with some
banks announcing fresh rounds of redundancies, following
increased worries about the Euro crisis.
Construction continued to have a low employment growth
rate due to completion of old projects and lack of new ones.

Source: GulfTalent.com Survey of HR Managers

16

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

2008-2012

Private Sector Pay Increase Global Comparison

% 2011

11%

12.6%

India
France

10%

Philippines
9%

6.7%

UK

8%

Canada

5.5%

GCC

7%

Australia

4.4%

6%

Australia
UK

5%
4%
3%
2008

2009

2010

Source: Economist Intelligence Unit

2011

3.1%

US

2.7%

Canada

2.7%

Source: Aon Hewitt, Hay Group, GulfTalent.com

17

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
Employment

Visa restrictions: Some Gulf governments have made it more difficult to apply
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

Mobility

19

The UAE and Qatar remain prime destinations for expatriates, with Saudi
Arabia in third place
Attraction of Expatriates
% of GCC-based expats outside the country who wish to
relocate into it

Observations

UAE has strengthened its position as the most

popular destination among Gulf-based expatriates.

70%
60%
UAE
50%
40%

Qatar

Qatar, which was rapidly closing the attraction gap

with the UAE, remains in second place and has lost
some momentum, as sentiments about the UAE
economy becomes more positive.

30%
Saudi Arabia

20%

Oman
Kuwait
Bahrain

10%
0%
2008

2009

2010

2011

Saudi Arabia remains in third place, with its

attractiveness stable, following a sharp rise in
popularity at the onset of the crisis.
Bahrain dropped from fourth place to the bottom,
becoming the Gulfs least attractive destination for
expatriates, following political tensions in the country.

Source: GulfTalent.com Surveys

20

Dubai remains by far the regions 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
37%

Dubai
22%

Doha

20%

Abu Dhabi
7%

Jeddah
4%

Muscat

Western
Expats

Asian
Expats

Arab
Expats

46%

35%

38%

21%

20%

25%

26%

20%

17%

3%

7%

9%

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

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

81%

UAE

64%

Kuwait

72%

59%

Saudi Arabia

49%

50%

Qatar

49%

51%

Bahrain

Oman

46%

45%

50%

Observations

UAEs already high retention rate has increased further,

due to a rebound in business confidence, declining rents
and the countrys high level of political stability.
Kuwait benefits from the long-term nature of its
expatriate population, with social and family ties formed
over the years discouraging expats from leaving the
country.
Qatars retention rate remains significantly lower than
UAE mainly because of laws preventing expatriates from
changing jobs.

50%

Bahrains retention rate has dropped for a second year,

following political tensions and slow economic growth in
the country.
Source: GulfTalent.com Survey

22

Abu Dhabi continues to serve as an employment hub for a portion of Dubai

residents, while Bahrains role as a base for working in Saudi has taken a hit

Dubai-residents working in Abu Dhabi

As % of all working professionals living in
Dubai

5.4%

Bahrain-residents working in Saudi Arabia

As % of all working professionals living in
Bahrain

5.4%

2.2%

3.4%
1.0%
1.1%

2007

0.9%

1.3%

1.1%

1.1%

2008

2009

2010

2011

2007

2008

2009

2010

2011

Source: GulfTalent.com Surveys

23

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

(Jan. 2011). Already removed fully for free zones.

Kuwait

New sponsorship system plans to remove NOC

requirement altogether, but not implemented yet

Saudi Arabia

NOC not required if previous employer below

required nationalisation targets (June 2011)

Qatar

Most strict in the Gulf. NOC fully enforced. No

indication of an imminent easing.

Guide to chart
Full labour mobility
(NOC not required)
No labour mobility
(NOC fully enforced)

* 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

Salaries & Cost of Living

25

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%

2007

2008

2009

2010

2011

5.6%

2012
Forecast

Source: GulfTalent.com Surveys

26

During 2011, Oman enjoyed the highest average increase in pay, followed by
Saudi Arabia and Qatar
Private Sector Salary Increase by Country
2010

2011

6.5%

Oman

6.0%

Saudi Arabia

5.6%

Qatar

Kuwait

UAE

Bahrain

5.1%

4.9%

4.5%

6.4%

6.7%

6.8%

5.7%

5.2%

Observations

Oman had the highest salary increase in the Gulf, in

part driven by widespread strikes by Omani
employees and the pay hike awarded in the public
sector.
Saudi Arabia and Qatar continued to have high
salary increases on the back of strong economic
developments.
Bahrain had the lowest salary increase due to lower
economic growth following the political unrest.

4.9%

Source: GulfTalent.com Survey

27

Average pay rise net of inflation, was highest in the UAE and Bahrain

Real Salary Increase by Country *

4.9%

Bahrain

4.0%

UAE

3.7%

Qatar

2.5%

Oman

Saudi Arabia

Kuwait

1.0%

0.4%

Salary Rise

Inflation

4.5%

-0.4%

4.9%

0.9%

5.6%

1.9%

6.5%

4.0%

6.0%

5.0%

5.1%

4.7%

Observations

Despite having the lowest salary increases in the

Gulf, Bahrain and UAE enjoyed the highest
increases in real terms due to very low inflation
rates.
Saudi Arabia and Kuwait had the lowest salary
increases in the Gulf in real terms, due to
relatively high inflation.

* Defined as nominal pay rise net of inflation rate

Source: GulfTalent.com Survey, Economist Intelligence Unit

28

HR professionals enjoyed the highest pay rise, while Administration and

Marketing had the lowest
Salary Increase by Job Category
%, 2011

Observations

HR

6.4%

IT

6.3%

Finance

Sales

Engineering

Admin

Marketing

5.5%

HR had the highest salary increase for a second year,

reflecting the rising profile and growing sophistication
of the HR role, as well as leaner HR operations
supported by fewer staff following the crisis.
IT had one of the highest increases last year, due to
global shortage and on-going demand for IT
professionals.

5.3%

5.3%

Admin candidates continued to have one of the

lowest increases, as companies continue to automate
processes and seek staffing efficiencies.

4.9%

4.6%

Source: GulfTalent.com Survey

29

Among sectors, Healthcare and Retail offered the highest pay rises, while
Real Estate had the lowest
Salary Increase by Industry
%, 2011

Observations

6.4%

Healthcare

6.2%

Retail & FMCG

Telecoms & IT

5.7%

Oil & Gas

5.7%

Engineering

5.6%
5.4%

Construction

5.1%

Travel & Hospitality

Banking
Real Estate

Retail sector continued to have high salary increase in

line with strong growth in the sector, generated by high
consumer spending.
Banking sector continued to suffer for a third year,
following a slow rate of recovery and fresh rounds of
redundancies on the back of the European debt crisis.

5.0%

Transport & Logistics

Education

Healthcare had the highest salary increase, due to

increased investments by GCC governments, specifically
Saudi Arabia.

4.6%
4.5%
4.3%

Source: GulfTalent.com Survey

30

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
1,930

Abu Dhabi
5.0%

Saudi Arabia

5.4%

1,650

Doha

1,590

Dubai
4.7%

Kuwait

4.0%

Oman

4.0%
3.2%

Muscat

1,000

Kuwait

960
910

Sharjah
1.9%

Qatar
UAE
Bahrain

-2.4%

840

Manama
0.9%
-0.4%

0.9%

Riyadh
Dammam

670

Jubail

670

Jeddah

670

2.0%

Khobar

Source: Economist Intelligence Unit

710

550

* Average figure. Wide variations based on location and quality

Source: GulfTalent.com Survey

31

2012 Forecast

32

Gulf salary rises during 2012 are expected to be broadly in line with 2011
Expected Average Pay Rise
%, 2012 Forecast
2012

6.4%

Qatar

6.2%

Saudi Arabia

5.6%

Oman

UAE

Kuwait

Bahrain

5.1%

4.9%

4.5%

2011

Observations

5.6%

Gulf employers generally expect similar salary

increases in 2012 compared to the previous year

6.0%

6.5%

Qatar and Saudi Arabia are expected to have the

highest increase in the Gulf and slightly higher than
their 2011 levels, as companies expand to capitalise
on the two countries strong economic growth

4.9%

5.1%

Bahrain is once again expected to have the regions

lowest salary increase in 2012 due to a stagnant
economy following domestic unrest in 2011.

4.5%

Source: GulfTalent.com Survey of HR Managers

33

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

77%

Saudi Arabia

73%

Oman

68%

Kuwait

65%

Qatar

UAE

Bahrain

51%

42%

62%

Observations

All Gulf economies are expected to have higher rates

of job creation in 2012 compared to the previous
year.

56%

51%

Saudi Arabia is expected to continue to have the

highest rate of job creation in the Gulf, thanks to high
economic growth and government spending.

51%

37%

Bahrain is expected to rebound partially from a

stagnant job market in 2011, but will continue to have
the regions lowest rate of job creation.

8%

Source: GulfTalent.com Survey of HR Managers

34

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

Oil & Gas

73%

63%

Retail

72%

60%

65%

Healthcare

61%

Telecoms & IT

63%

50%

Transport & Logistics

62%

41%

Travel & Hospitality

62%

43%

Engineering

58%

46%

Real Estate

57%

33%

Construction
Banking

48%
46%

Source: GulfTalent.com Survey of HR Managers

Observations
Oil & Gas is expected to have the highest expansion
in 2012 due to new projects in the sector.
Retail is expected to continue growing at a high rate
due to higher net disposable income and consumer
spending.
Banking is expected to have the lowest rate of job
creation in 2012, due to continuing credit concerns
and the Euro-zone financial crisis

27%
28%

35

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

Europe, including the possibility of a sovereign default,
could lead to another global recession impacting Gulf
countries, particularly the UAE which is more exposed
to global trade and tourism.

Arab spring: Significant uncertainty remains over the

outcome of the conflict in Syria, the kind of
governments which are likely to emerge in place of
those that have fallen, and the extent to which
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
Dollar against other currencies could impact Gulf
employers ability to attract and retain expatriates
particularly from major source countries such as India.

Iran tensions: A possible military conflict with Iran

could have unpredictable consequences for the entire
Middle East region including Gulf countries.

Source: Economist Intelligent Unit, GulfTalent.com Interviews

36

Appendix Useful Information

37

Useful Information
Salary Rise by Country
% Rise in Base Salary
Country

Economic Growth
% Real GDP Change

2010

2011

2012 F

Bahrain

4.9%

4.5%

4.5%

Kuwait

5.7%

5.1%

Oman

6.4%

Qatar

2010

2011

2012 F

Bahrain

4.5%

2.2%

3.1%

4.9%

Kuwait

3.1%

4.4%

5.4%

6.5%

5.6%

Oman

5.0%

4.7%

4.5%

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
Country

Country

Population (millions)
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

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