It almost defies economic logic. While the Middle East is still sucking in accounting skills and hot new talent, the once attractive remuneration packages that gave the region its ‘streets paved with gold’ reputation have quietly been slimmed down and are now much closer to those on offer in other key markets around the world.
Even as some governments in the region announce precautionary measures in response to the Omicron variant, the post-pandemic adjustment period in the Middle East is a mix of growth and revised outlook. It has led to hiring sprees to replace talent lost during Covid-19 cost-cutting. At the same time, the results of regional salary surveys reveal that these new roles come with salary packages that are rather less attractive than they used to be, lagging behind the average rise globally.
According to the Robert Walters 2022 survey, salaries are 15% to 20% lower than pre-pandemic in terms of what is being offered, a noticeable decrease. The UAE is still lagging in the global war for talent while the local cost of living is relatively high and still rising.
‘It’s not only about salaries. What Covid-19 has brought into focus is benefits, with candidates especially interested in flexible working’
Hashil Chiba, senior consultant at professional recruitment consultancy Robert Walters, says: ‘It’s not as lucrative as it once was, but many SMEs are paying more, because of the risk of joining a smaller business. As a blanket statement, salaries are lower, but in certain industries like technology they are paying better salaries.’
David Mackenzie, group managing director for recruitment business Mackenzie Jones, says: ‘Expat salaries took a 30% hit during Covid and there were mass redundancies across all sectors. As demand increases, we are seeing salaries start to rise in certain areas, but we are still a long way off the peaks of 2016 and 2017. Local [UAE] nationals have always attracted a premium and will do so for the foreseeable future even as the emphasis on nationalisation becomes increasingly front of mind for the UAE and KSA.’
Bounceback
Mackenzie confirms that the fastest-growing sectors are in technology and tech-enabled businesses. ‘But we have also seen FMCG and retail sectors bounce back quickly. These sectors are hot partly due to the rebound after Covid-19, but also to the growth in startups in the UAE. The government has been very active in encouraging growth in this sector.’
Gareth El Mettouri, market director for staffing company Robert Half in the Middle East, says: ‘Last year was a difficult year globally, and Dubai was hit pretty hard, driven by the fact that it is a leisure, tourism and aviation hub. But things are bouncing back quicker than expected. We are seeing demand from various sectors – technology, tech startups, e-commerce. Tech firms moving from countries such as Turkey and Israel are also driving opportunities in the region.’
Although construction, engineering and manufacturing are in a bit of a dip, currently glowing-hot sectors for skilled professionals in the UAE include technology across many sectors: retail, e-commerce, fintech, logistics and transportation, as well as hospitality and property. These are all coming back to life after the pandemic.
Skills
Robert Half, which specialises in placing finance and accounting professionals, points out in its 2022 salary guide that the finance, accounting and financial services workforces in the region are all being rebuilt. In-demand roles include finance managers, financial controllers, FP&A managers, financial analysts and finance directors. Candidates for senior positions such as CFO are also heavily in demand again.
In the UAE, expatriate skills in accountancy are always in demand, but Arabic-speaking and Emirati accountants are particularly highly sought after, especially for government roles. ‘The UAE has handled Covid-19 well, and I think next year there will be a war for talent here,’ adds El Mettouri.
‘There has definitely been a shift towards financial planning and analysis,’ says Chiba. ‘Planning, realistic budgeting and forecasting are all in demand. During the pandemic, cash management and treasury “blew up”, and then moved towards skills such as automation. Now we are seeing a cycle of FP&A. FP&A is hot across all the trending industries. There are also more mergers and acquisitions roles coming up.’
‘When you counter-offer a candidate, it’s usually already too late’
Retention and recruitment
The failure of salary rises in the region to match the average global increase has made it harder for employers to hang onto staff. Chiba says there has been an increase in counter-offers as candidates move on because the salary no longer justifies the job challenges. ‘If companies demonstrate they value their candidates, they will not leave. If you want to retain your staff, then line managers and HR need to ask how staff are doing and make proactive attempts to speak about salaries and benefits. When you counter-offer a candidate, it’s usually already too late.’
With recruitment equally challenged when the salary premium disappears, what can employers in the Middle East do to attract – and keep hold of – that much needed talent? ’It depends on the type of business,’ says Mackenzie. ’If you’re a startup and cannot afford to pay high salaries, then there are ESOPs [employee stock ownership plans] or sweat equity [payment in shares or share options]. You can also promise increases based on hitting certain targets, or link pay to company performance.’
Robert Half advises companies to go the extra mile and offer competitive benefits, particularly hybrid working. El Mettouri says: ‘It’s not only about salaries at the moment. What Covid-19 has brought into focus is benefits, with candidates especially interested in flexible working.
‘The salary guide shows that flexible working was the top benefit requested by candidates. Many regional clients are requesting staff return to the office, while global multinationals are continuing to allow working from home. Meanwhile, employers are looking for candidates who can fill hybrid, tech-focused positions within the team, such as tech CFO.’
Flexibility, it seems, is in as much demand with employers as it is with employees.
