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Online recruiting firm GulfTalent has recently released its annual study, "Employment and Salary Trends in the Gulf". The 2014 edition of the report sheds an overview of the status of the job market and forecasts key developments for 2014 in six countries of the Gulf Cooperation Council (GCC): Saudi Arabia, Kuwait, Qatar, Oman, Bahrain, and the United Arab Emirates.

The report is based on data collected from an online survey of 34 thousand professionals and 800 executives and HR managers, interviews with 60 senior executives, in addition to 200+ relevant reports from the press and news sources across the region and various macroeconomic sources. Respondents’ occupations span across all major countries.

Below are some key highlights:

2014 will be a year of stronger employment growth

Saudi Arabia was the leader in job creation in 2013, with 62% of companies increasing their headcount last year. [Tweet This]

The Kingdom was followed by the UAE and Kuwait. For 2014, the survey found that across the GCC, more companies expect to increase their headcount in 2014 compared with last year, this time lead by Qatar, where 75% of companies will create jobs this year. The positive development is primarily due to the execution of major infrastructure projects gathering momentum, partly in preparation for the 2022 World Cup.

Next are companies in Saudi Arabia and the UAE, with 63% and 57% of companies looking to create jobs respectively. [Tweet This]

Even companies in Bahrain are showing signs of improvement in job creation as the political situation stabilizes further: 30% of companies expect to increase their headcount, compared with only 9% in 2013.

Broken down into sectors, healthcare topped the table with 80% of companies having created jobs in 2013, driven by heavy government investment in the sector and more countries making health insurance mandatory for employers. According to the survey, telecom and retail sectors competed for second position.

In 2014, hospitality and retail will dominate job growth in 2014. 61% of companies in the hospitality sector are planning to increase their headcount, as they expect 2014 to be a year of growth for the industry. As regards the retail sector, 57% of firms will create jobs, driven by the region’s rapid population growth and increasing penetration of retail outlets in more remote locations.

Salary increases

Across most of the GCC, private sector salaries are forecast to rise at a faster pace in 2014 compared with the previous year. As you can see below, Oman leads the field where employees are expected to enjoy an average pay increase of 8%. [Tweet This]

Saudi Arabia has the second highest rate with a projected average increase of 6.8 %, followed by Qatar at 6.7% and the UAE at 5.9%. Kuwait and Bahrain are forecast to have the region’s lowest salary increases - projected at 5.8% and 3.9% respectively. While the salary increases are higher than the previous year, they continue to be below the levels seen before the crisis.

The tables below illustrate the salary increases in all of the studied countries and contrasts them with real GDP growth, inflation rates for both 2013 and 2014 and the forecasted population count for 2014.

Potential uncertainties

The report concludes by listing several uncertainties that may impact the Gulf economy and labour market during 2014. Those are the oil price, major international events, the world economy, and regional politics.

The price of crude oil is the biggest determinant of business and employment prospects in the Gulf. While the outlook is strong, the region remains vulnerable to a drop in prices, for instance, if economic growth were to slow down further in China.

The impact of the Qatar 2022 World Cup tournament and Expo 2020 remain unclear in the short term as both events are quite a few years away. Meanwhile they may lead to a higher inflation rate which will in return put pressure on salaries.

Major emerging markets are seeing a slowdown in their economic growth and fall in currency values while political tensions have hit others. This could result in a new wave of talent seeking opportunities in the Gulf. In the West, economies are recovering from their long recession, which means that employers in the Gulf might find it harder to attract talent from those markets. [Tweet This]

After the Arab Spring, affected countries remain in a state of flux and people and capital has been shifting to the Gulf as a result, particularly from Syria and Egypt. If Iran’s attempt to negotiate a lifting of sanctions succeeds, it will impact some Gulf sectors, with the UAE being the primary beneficiary.

The full report is available for download on GulfTalent. In it you’ll find detailed info on GCC vs world economic growth and the key factors affecting it in each of the GCC countries, the effect of nationalisation pressures on employers, the impact of currency fluctuation on recruitment, and the most attractive GCC countries for expatriates and the ensuing benefits. All you need to do is to hop on to this link , enter some very basic personal and you can get a copy free of charge.