Salaries to go up by 4.7pc

According to survey by the latest report

 Manama

 A GCC-wide survey of 600 multinational companies and locally-owned conglomerates has forecast that salary increases will average 5 per cent next year, down from an anticipated 6pc in 2013, 5.5pc in 2014, and 5.1pc this year.

 Among the participating GCC organizations, companies based in Bahrain predicted the lowest increases at 4.7pc, slightly higher than last year’s predictions of 4.5pc. In 2015, Bahrain-based firms reported actual salary increases at 4.7pc.

 According to the latest GCC Salary Increase Survey conducted by Aon Hewitt, GCC states have seen GDP levels drop due to weak global oil prices, less foreign direct investment and struggles amongst large economies such as Russia and China.

 The situation, however, has clearly had a somewhat limited effect on firms, with most still planning to increase the salaries of their employees by a good amount next year. 

 Clearly, the impact of lower oil prices can be felt across the region, with governments cutting back on subsidies, reducing spending on larger projects and thinking about introducing some form of taxation. All these factors will have a direct or indirect effect on industry sectors, and will continue to put pressure on profit margins and operating costs for organizations.

 Despite this, the GCC is faring much better than other oil producing countries in the Middle East.

 Kuwait-based companies gave the highest salary increase projection for 2016 at 5.2pc. This is a slight decrease on 2015’s 5.3pc predicted raise. Kuwait’s actual salary increase figure for the year stands at 4.7pc.

 Qatari and Omani firms, on the other hand, estimated 5.0pc salary growth for 2016, lower than 2015 predictions of 5.2pc and 5.4pc respectively. Actual salary increase figures for 2015 stand at 4.7pc and 4.6pc respectively.

 UAE companies also projected 5.0pc growth for the next year, up from 4.8pc projection made for this year, while firms in Saudi Arabia forecasted 5.1pc for 2016 -- down by 0.3pc on this year’s projection. In terms of actual increases for 2015, however, the UAE stands at 4.8% while Saudi Arabia recorded the highest level of actual pay rises at 5.2% for this year.