In Dubai, almost everyone has a job but not everyone is happily employed
The numbers don’t lie – that’s certain. With Dubai having just revealed it enjoys one of the lowest unemployment rates in the world, the image of a flourishing metropolis comes to mind. But are there any hidden layers of dissatisfaction? Let’s find out.
Dubai on top again
The Dubai Statistics Centre revealed in a 2017 study on Wednesday that its namesake city has one of the lowest unemployment rates in the world, totaling a minuscule 0.5% compared to the global average of 5.52%. The official figure is 2.78 million employed, with 110,000 residents joining the workforce over the past three years.
Dubai’s population is 3 million.
Given Dubai’s high living costs, only 2 million of those employed currently live there, while the other 700,000 live in nearby emirates.
Overall economic participation, i.e. the percentage of employed people in the working age population, added up to 83%, presenting a 1% increase. Emirati economic participation, on the other hand, added up to 51%. This percentage was shared at 65.4% for Emirati men and 37.4% for Emirati women. The low rate of Emirati women involved can be attributed to conservative values in the region.
However, gradually changing gender roles have brought about an increase in the female overall economic participation rate, bringing it to 53.6%.
Unemployment rates are relatively low in the Gulf region, save for Saudi Arabia with an alarmingly high rate totaling 12.7% today.
A low unemployment rate can be a sign of a thriving economy, but is its workforce satisfied?
Ready to quit?
A recent study by Gallup shows that for the most part, UAE employees are in fact satisfied with their jobs. 57% of the population considers themselves thriving in their current and future lives, of those 64% are Emiratis and 52% non-nationals.
At 69%, the UAE has the highest employment rate among full-time working adults (not self-employed), but only 12% of those have full-time jobs that engage them, according to a new Gallup global job figures report, released recently.
So that’s an alarming 88% that are not engaged and possibly on the lookout for something that stimulates them in their daily lives and careers.
The lower satisfaction rate with non-nationals can be due to the high cost of living in Dubai, and particularly the cost of rent. More than half the population is unsatisfied with the availability and affordability of housing, particularly close to where they work. Gallup reports that when they asked this same question in 2009 and 2010, non-nationals showed higher dissatisfaction with housing. This is due to non-nationals generally earning less than nationals in the country. As of late, however, both sides of the population are showing relatively equal unhappiness with the availability of good, affordable housing.
A recent survey by YouGov revealed almost half of survey respondents (46%) expected a relative pay increase to compensate for their rising cost of living, mainly due to Excise levies and 5% VAT.
The implementation of VAT at the start of the year might have an effect on employee satisfaction in the long run.
In Saudi Arabia, for example, a similar implementation of VAT has led to slight price inflation, with financial services firm Al Rajhi Capital estimating consumption to remain relatively flat until 2020, increasing just 3.8%.
The non-national population is bound to be hit harder by VAT over the years, as the expats with lower incomes feel the weight of this tax chipping away at their salaries with every purchase.
While there have been income tax talks, employees can rest easy as there are no current plans for implementation at the moment.
Overall, it seems that save for a few minor setbacks, the image Dubai is painting to the world is a genuine one.