Gulf job market hopeful amid the crisis

The Gulf region has seen a decline in recruitment activities in recent months due to the global financial crisis, but industry experts say the job market will bounce back as regional economic pressure eases.

Unlike other economies, GCC states have been the last to feel the brunt of a broiling financial meltdown that began to sweep across the globe in July 2007. Major factors such as waning industrial demand, falling oil prices, weakening currencies and crashing stock markets have elicited a domino effect that changed the overall landscape in the regional job market.

According to a recent study published by internet recruitment portal GulfTalent.com, companies restructuring their organisations through job cuts have been a visible sign of regional recession, with the highest concentration observed in Dubai.

The emirate’s share of regional recruitment activity has fallen to 30 per cent in the first half of 2009 as compared with 43 per cent in the first half of 2008. Kuwait and Bahrain also posted a drop in hiring activity from 10 per cent and 7 per cent, respectively, in the first six months of 2008 to only 7 per cent and 4 per cent in the same period this year.

A representative of another online job site Bayt.com reported, however, that the second quarter of 2009 has seen a slight improvement as the impact of the global economic downturn starts to ease up locally.

“[This improvement has been] somewhat propelled by recent announcement about new mega projects being planned across the region (Dubai, Abu Dhabi and Saudi Arabia), which gave consumer confidence a positive boost,” says Amer Zureikat, regional manager of Bayt.com.

He added that a third of participants in Bayt.com’s Consumer Confidence Index survey published in June this year, said they are optimistic about the future employment market in the Gulf.

“Now is indeed the perfect time for employers to fill their positions, either to compensate for loss of staff that occurred during the first quarter of the year, or to take advantage of the highly talented professionals available today in the market,” he said.

Current trends in the Gulf

In its report titled “Recession and Employment in the Gulf”, GulfTalent.com mentioned that staff turnover has fallen significantly across the region as career opportunities remain scant and job security becomes a top concern among employees.

The research also noted that employees have been faced with mounting pressure to hold on to secure jobs instead of actively looking for better opportunities except when they believe that their companies are about to go belly up.

Zureikat added other interesting trends that Bayt.com and YouGov have observed in the region based on their “Surviving the Recession” joint survey, which was conducted online among 12,908 respondents.

Among these trends were the fact that 43 per cent of their respondents have cut down on household expenses; 25 per cent have opted to find a job in a country away from their family; 8 per cent have moved with their family to a different country; 7 per cent have sent their family back to their home country; and 7 per cent have transferred to a smaller and cheaper accommodation.

The lifestyle of residents in the Gulf region had also been hit hard as job security and financial condition become a major concern, according to the Bayt.com-YouGov research.

The current lifestyle trend saw about 46 per cent of surveyed professionals have cut back on their entertainment activities; 45 per cent on dining out; 43 per cent on shopping for oneself; 40 per cent on vacation and holiday expenses; and 36 per cent on buying home furnishing.

Industries affected by the downturn

Bayt.com’s Zureikat said that among the hardest hit sectors in the region were those that boomed and grew the most in 2008 including property, banking, finance and supporting peripheral industries.

“While many sectors have cut down from the highly elevated recruitment levels of last year, they continue to conduct some level of hiring activity to replace key personnel who are departing or to reshuffle departments, reprioritise key projects and shift strategy focus,” Zureikat said.

He added that talent remains very robust in certain segments such as healthcare, education and engineering with the new regulations of health, safety and environment (HSE) being implemented worldwide.

GulfTalent.com’s study, which was based on 700,000 online searches conducted by employers and recruiters on its website, saw the demand for investment, administration and marketing professionals dwindling in the first half of 2009 because of the credit crunch’s debilitating effect on certain sectors.

However, higher government spending in infrastructure projects have raised the need for general managers, auditors and infrastructure professionals such as engineers, urban planners and highway designers.

Outlook for the Gulf job market

GulfTalent.com believes that the Gulf economy is poised to recover in 2010 with employment activity gaining momentum as a result although at a slower pace.

Recruitment activities, however, will remain dependent on the oil price and its subsequent effect on various industries.

Bayt.com shares the optimism as it reported that faith in regional economy has seen a positive jump. It believes that while confidence in business conditions may have taken a dip, there are expectations that this will eventually pick up.