|The United Arab Emirates is one of the most attractive labor markets in the world. Based on its 2018 Annual Economic Report, their labor force participation rate was about 92.8% of the total male population and 41.6% of the total female population / Photo by: Toumi Fethi via Flickr|
The United Arab Emirates is one of the most attractive labor markets in the world. Based on its 2018 Annual Economic Report, their labor force participation rate was about 92.8% of the total male population and 41.6% of the total female population. Every year, the country also attracts expatriates with promises of luxury housing packages, tax-free salaries, and sunny weather. The city of Dubai, in particular, is a financial and trade hub that provides tons of opportunities for people who dream big. Better salaries and job prospects are encouraging foreigners to work in Dubai.
Dubai’s Labor Market
A new report from London-based global information provider IHS Markit, however, showed that business growth in the city has stalled. Jobs have also disappeared at the fastest pace in 10 years, added international news agency Bloomberg. In January, the city’s operating conditions in the non-oil private sector worsened for the third straight month and was its lowest level record in nearly four years.
|The city of Dubai, in particular, is a financial and trade hub that provides tons of opportunities for people who dream big. Better salaries and job prospects are encouraging foreigners to work in Dubai / Photo by: Imre Solt via Wikimedia Commons|
Purchasing Managers’ Index
Dubai’s Purchasing Managers’ Index, which is an economic indicator derived from the monthly surveys of private sector companies, declined to 50.6. Construction, retail, and wholesale likewise dropped. IHS Markit economist David Owen said that employment in the city was affected, with firms reporting about the joint-quickest decline in employment numbers seen in the last decade. Dubai companies are also expecting a little improvement in sales in the future.
As business conditions in Dubai deteriorated, it also caused layoffs so firms could streamline their operations while facing weak demand. Emirates NBD, the biggest bank in the city and one of the lenders in the UAE, also reduced the number of their employees. Thousands of people were affected because of the said job cuts.
Business Conditions in the UAE Worsened
For the first time, the country’s business condition also worsened as the coronavirus outbreak threatened the nation’s tourism and trade. As of February 11, the Gulf country announced its eight cases of coronavirus infection.
London-based economic research consultancy Capital Economics’ group chief economist Neil Shearing also shared via CNN Business that “the outbreak has the potential to cause severe economic and market dislocation.” This is because China is an indispensable part of the global business.
Dubai, for its part, cannot afford a decline in tourism because its prospects are connected to the success of the much-awaited 2020 World Expo. The expo in Dubai will be a celebration of the UAE Vision 2021 to support the growth of tourism and stimulate the development of innovative businesses in the country. Furthermore, Expo 2020 aims to encourage collaboration and enhance the UAE’s international reputation as a location to do business. The city’s preparation for Expo 2020 is already in full swing as they are expecting that it will attract about 30 million visitors in the six-month duration of the event.
|For the first time, the country’s business condition also worsened as the coronavirus outbreak threatened the nation’s tourism and trade. As of February 11, the Gulf country announced its eight cases of coronavirus infection / Photo by: CynthiaDSouza via Wikimedia Commons|
UAE Employment and Unemployment Rate
Our World in Data, a scientific online publication that focuses on large global problems, shared the unemployment rate in UAE during the following years: 2000 (2.25%), 2002 (2.74%), 2004 (2.98%), 2006 (3.23%), 2008 (4.01%), 2010 (3.69%), 2012 (2.97%), 2014 (2.28%), 2016 (1.64%), and 2017 (1.67%).
In 2015, 17.4% of foreigners in Dubai were hired as skilled service workers or shop and market sales workers, 9.8% as craft and related trades workers, 16.9% as plant and machine operators and assemblers, 12.6% as professionals, 7% as legislator, senior officials, and managers, 4.9% as clerks, and 7% as technicians and associate professionals. This is according to German database company Statista
As of the number of tourists coming to the UAE whose main purpose in visiting is not commercial, it likewise increased from 2.31 million in 1995 to 3.91 million in 2000. Then, it gradually increased in the following years: 2001 (4.13 million), 2002 (5.45 million), 2003 (5.87 million), 2004 (6.20 million), and 2005 (7.13 million).
The Workforce in the UAE
The official portal of the UAE government published that the total labor force in the country in 2017 was 6,447,200. The top five sectors by the percentage of employees hired in 2016 were extractive industries (31%), public administration and defense (13%), wholesale and retail trade and repair (9%), construction and building (8%), and transformative industries (7%). Meanwhile, the top five sectors by percentage of wage earned by the country’s workforce were public administration and defense (18.10%), wholesale and retail trade and repair (12.70%), construction and building (11.40%), transformative industries (09.90%), and transportation and storage (08.60%).
Among the top reasons why foreigners choose to work in Dubai is that it offers a high quality of living. Aside from being tax-free, the place also spoils them with different modes of entertainment and various supermarkets and restaurants. Dubai is also ranked at 40 worldwide when it comes to safety parameters. It does not matter what time of day expats step out of the city as they can freely walk on the street without the fear of being mugged or attacked. The country’s police are fast and efficient. The growing network of ports, rails, roads, and other development projects also makes Dubai attractive to foreigners to work in.
For professionals who want a global exposure of their talent, Dubai has a diverse array of employees and workers. Since Dubai is strategically located at a junction between the Far East, Africa, and Europe and is easily accessible from several parts of Asia, it has become a multi-cultural workforce. Their jobs are not just a source of income to people, but they also give them purpose and meaning to contribute to their family, community, and the country as a whole.
Dubai has been a second home to different nationalities working and living there. It has progressed over the years and has become a place that people will want to migrate to. The IHS Markit report, though, illustrates that it may take some time for the country’s labor market to improve. This will be a significant source of information for labor market researchers, planners, policymakers, and decision-makers in the city to promote job creation.