According to the Robert Half 2025 Salary Guide, the UAE’s growing expatriate population has expanded the talent pool, enabling employers to offer lower salaries and reduce benefits packages. This trend is particularly evident in sectors such as finance, accounting, and human resources, where professional services salaries have decreased by an average of 0.7% over the past year.

Business leaders remain optimistic, with 63% anticipating an increase in headcount over the next year, primarily driven by organizational growth. However, economic factors, including global election outcomes and fluctuating interest rates, have prompted approximately one-third of these leaders to delay hiring decisions until greater economic stability is achieved.

Employees are acutely aware of the intensified job market competition, which has diminished their leverage in salary negotiations. A significant 75% report increased difficulty in securing pay rises compared to the previous year, and 52% feel easily replaceable. This environment has led 65% of employees to remain in their current roles out of necessity rather than preference.

Despite the abundance of candidates, employers face challenges in finding individuals with the precise skills and UAE-specific experience required. This has led some to compromise on their ideal candidate profiles due to budgetary limitations. The disparity between employer perceptions and employee sentiments regarding job satisfaction and morale suggests that over-optimism on the part of employers could overlook underlying issues.

The UAE’s non-oil private sector has shown resilience, with the S&P Global UAE Purchasing Managers’ Index rising to 55.4 in December, indicating robust demand and increased business activity. However, employment growth remains sluggish, with the job creation rate at its lowest in over two-and-a-half years. Input cost inflation has eased, allowing firms to continue discounting prices amid strong competition.

News Source: Medium