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DUBAI (Reuters) – Corporations within the United Arab Emirates are largely resisting calls for for greater pay to offset the affect of inflation, in response to a survey that confirmed two-thirds of firms have obtained requests for wage will increase.
Mercer, in its 2022 UAE Inflation Spot Survey of 200 worldwide and native corporations, mentioned solely 16% of them have taken some motion, like one-time lump-sum funds, off-cycle wage bumps or housing allowance will increase, as they appear to retain expertise.
The Central Financial institution of the UAE tasks inflation at 5.6% this yr, which is decrease than different elements of the world however could be the nation’s highest price since 2016.
Mercer additionally mentioned that Dubai, the UAE’s commerce hub, is among the most costly cities for expatriates to work and reside on this yr, in response to a separate survey.
Regardless of that, 47% of corporations within the UAE aren’t planning any motion in 2022, whereas 37% are both weighing or planning some type of off-cycle compensation changes.
Enterprise exercise has been increasing robustly within the UAE, with the non-oil non-public sector rising at its quickest tempo in 38 months in August, rising the necessity for firms to retain expertise with a purpose to meet excessive demand.
“Employers are being cautious about instantly bumping up wages to match inflation, and lots of are contemplating short-term actions with much less everlasting implications resembling lump-sum quantities or retention bonuses, or are investing in enhancing workers’ work expertise by providing improved work-life stability, flexibility and coaching,” Andrew El Zein, a senior affiliate advisor at Mercer, mentioned in a press release.
“Having mentioned that, firms are budgeting for greater rises subsequent yr, in the end offsetting workers’ inflation issues and matching rising pay expectations.”
Corporations within the nation are budgeting wage will increase of 5% in 2023, above 3%-4% rises lately, Mercer mentioned.
(Reporting by Yousef Saba; Modifying by Hugh Lawson)
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