Thursday, Nov 05, 2015

Dubai: In the third quarter of 2015, the UAE saw a fall of 5 per cent in the number of new jobs available to 7,621 in the professional hiring market against 8,002 jobs in the third quarter of 2014, according to the quarterly employment monitor published by Morgan McKinley is a global professional services recruiter.

The rather slow summer that we witnessed in the recruitment market in the second quarter of this year continued into the third quarter. While seasonal factor had an impact on the job growth during summer months, the slow growth has lingered into the third quarter and the professional recruitment market expects only a modest growth in the last quarter, but hiring is expected to accelerating in the first half of 2016.

The latest UAE Purchasing Managers Index (PMI) also indicated loss of momentum in non-oil private sector output growth reinforced by a modest rise in employment. The rate of job creation was muted in comparison with historical data and little-changed from the six-month low seen in September.

In addition, tourist figures and hotel occupancy rates were lower than expected this summer, which may have been a further contributory factor in the drop not only in the quarter-to-quarter comparison but also the 5 per cent fall in vacancies compared with the third quarter of 2014.

“This is the first quarter-on-quarter drop of this magnitude that we have recorded but the underlying trend is still positive and we see no reason for pessimism,” said Trefor Murphy, Managing Director for the Middle East and North Africa at Morgan McKinley. “The coincidence of Ramadan and summer has undoubtedly had an unusually strong impact.”

Low prices continue to affect recruitment in the oil and gas and related sectors, in all areas except downstream, with many companies imposing hiring freezes and in some cases redundancies in the engineering, procurement and contracting (EPC) area.

“The oil price briefly went back up to $60 per barrel toward the end of the second quarter, but then fell back. It needs to go up by $10 a barrel to make new drilling and exploration projects viable,” Murphy said.

Growth in the property market has also slowed somewhat with new supply coming on stream and a consequent softening of pricing by 5 per to 15 per cent. “Banks are responding by offering prolonged payment plans to attract new buyers and there is now some good value on the market, so we expect this to be a short term phenomenon,” he said.

Fuelled by new projects the construction sector is still hiring. The slowdown in the growth of some Asian markets, in particular China, has made investment in the UAE relatively more attractive. Many office towers and hotels are being built and a number of major infrastructure projects have recently been given the green light by the government.

The trend showed that sales and marketing people are also in demand in virtually all sectors, including FMCG, pharmaceutical, medical device and property, in spite of the seasonal slowdown. “The banking sector has also had a good quarter, up by 2 to 3 per cent on the previous quarter,” said Murphy.

Morgan McKinley expects professional recruitment market will bounce back for the rest of the year and into 2016. “There is every reason to believe that employers will make up for the slow rate of hiring in the third quarter. That said, there is still a surfeit of oil on the market and much depends on where the price of oil goes next,” Murphy said.

By Babu Das Augustine Banking Editor

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