Private-sector workers in the Emirates received their biggest pay rise in four years last month, according to HSBC’s monthly economic activity poll.
The bank recorded the steepest increase in wage inflation in the 47 months it has collected data for its Purchasing Managers’ Index (PMI), a set of economic health indicators gleaned from non-oil producing private sector employers.
The headline manufacturing PMI, a figure derived from stocks of purchases, new orders, output, employment and delivery times, fell slightly to 54.1 in June compared with 55.3 the previous month. A score above 50 usually means that the economy is expanding.
“Although the data shows a modest slowdown into the start of the hot summer months, the economy is still in growth mode with output still rising and employment gaining speed,” said Simon Williams, the chief regional economist at HSBC.
“The sharp slowdown in other emerging markets is a concern, but robust new orders figures suggest the UAE is likely to retain momentum for now, as strong domestic and regional demand compensates for weakness in Asia and beyond.”
UAE companies are not only raising salaries but also hiring more employees. Job creation sped to its highest rate in the past one-and-a-half years and average staff costs every single month for nearly the same period, said the bank.
While 12 per cent of companies said they had more staff than before compared with 4 per cent who cut headcount, the outlook was not sunny across the board. Export orders grew at their slowest rate since last July because of “deteriorating economic and political conditions in foreign markets”.
source: The National.ae
Still, 29 per cent of respondents said they were getting more orders and 9 per cent said their backlog was growing.