The UAE tourism industry is one of the most promising industries in the UAE. According to data published by the UAE Ministry of Planning, hotels & restaurants represent around 3% of the country non-oil GDP and employs almost 4.4% of total work force. Their growth rate in 2004 was of 13% with a compound annual growth rate of 7.81% in the preceding four years. DCCI has conducted a study to highlight the characteristics of the UAE tourism industry.
Hotels
With a growth rate of 4% compared to 2001, in 2003 there were 366 hotels in the UAE of which the majority was located in Dubai (74%). Abu Dhabi came in the second place (14%) followed by Sharjah (6%). The rest of hotels (6%) were scattered over the four other Emirates. Dubai had the highest occupancy rate for rooms (72%). Abu Dhabi and Sharjah showed high occupancy rates as well (61% and 60%, respectively). Occupancy rates in the rest of the Emirates were ranging between 53% and 59%. The overall occupancy rates in all Emirates are considered quite high (68%) compared to nearby countries.
Tourist arrivals to the UAE reached 5.9 million in 2003 outnumbering the country's total population estimated at 4.3 million. The majority of hotel guests (74%) were hosted in Dubai hotels while the other 26% were distributed on the rest of Emirates. Dubai also recorded the highest ratio of booked nights (72%) followed by Abu Dhabi (15%). Guests from Europe and America represent the greater part of arrivals to the UAE (i.e. 31%). They also dominate nights spent in the UAE (38%) compared to those from other nationalities. Furthermore, and in terms of arrivals, the GCC and other Asian-African countries came in the second and third places with 30% and 26%, respectively.
Hotel revenues in the UAE touched $ 1.4 billion in 2003. Given that the bulk of hotels and arrivals are in Dubai, consequently highest hotel revenues in the UAE were reaped by Dubai hotels (74%) followed by Abu Dhabi hotels (18%). The remaining 8% was distributed on the rest of Emirates. Total UAE hotels' revenues are composed of almost 50/50 lodging and other revenues and total revenues are mainly coming from De Luxe and First Class hotels. This fact indicates that arrivals do rely by an equal proportion on hotel services and additional facilities other than lodging. In addition, De Luxe and First Class hotels are the most preferred by arrivals to the UAE. Second and Third Class hotels generate only 15% of total hotels' revenues in the UAE and they are generally used for lodging only.
According to available data, the total employment in hotels in the UAE is estimated at 32,915 employees in 2001 receiving a total wage amount of around $ 288 million. Again, Dubai occupies the first rank in terms of number of employees (69%) as well as total amount of paid wages (68%). Abu Dhabi came second with 19% of the country's hotels employees and 22% of paid wages.
Restaurants and Coffee Shops
In 2003, there were 5,966 restaurants and coffee shops in the UAE with Dubai and Abu Dhabi encompassing the greater part of them (40% and 30%, respectively). The remaining 30% was distributed over the other five Emirates. Revenues of restaurants and coffee shops reached $ 1.5 billion. The majority of revenues were reaped by Dubai (41%) and Abu Dhabi (32%) followed by Sharjah (18%). The four remaining Emirates share of revenues was estimated by only half the share of the Emirate of Sharjah (9%).
For employment in restaurants and coffee shops, 43% of the total number of employees (i.e. 59,340) was working in Dubai in 2003. Abu Dhabi had 32% of total employees while Sharjah had 13%. The remaining 12% were scattered over the other four Emirates. On the other hand, wages in the same year accounted for $ 257 million for the whole UAE. As expected, Dubai occupied the first rank in terms of share of paid wages with 46% followed by Abu Dhabi and Sharjah (34% and 11%, respectively).
Revenues and Labor Productivity
From the previous paragraphs, we note that at the UAE level the number of employees in restaurants and coffee shops (59,340) almost doubles the number of employees in hotels (32,915) while total revenues ($ 1,507 and 1,476 million, respectively) as well as total paid wages ($ 257 and 288 million, respectively) are comparable for both. This fact indicates that average wages in restaurants and coffee shops are almost half those in hotels, which reflects that the former employees are relatively more skilled than the latter's.
Finally, for hotels, highest revenues per bed as well as labor productivity are those of Dubai and Abu Dhabi hotels followed by Sharjah and the rest of Emirates. This phenomenon is supported by the reasoning that Dubai and Abu Dhabi are main destinations for tourist arrivals in the country.
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© Press Release 2006
