2009-10-19
|
Average Salary Increase at 7.9%, Fewer Organizations on Salary Freeze
|
Dubai - Hewitt Associates, a global human resources consulting firm announced today that the average salary increase planned for 2010 by Middle East organizations stands at 7.9%. In 2009 these organizations had given an increase of 6.9%.
These findings were based on Hewitt's Annual Salary Increase Survey in the Middle East for 2009-10. The salary increase percentage excludes organizations that had opted for salary freeze or salary cuts.
While the increase percentage is far from the double digit growth that the region has seen over the years, it is a sign of a positive outlook for the next year in the region.
The survey of 239 large organizations across Middle East reveals that the number of organizations opting for salary freeze is expected to drop from 42% in 2009 to 14% in 2010. A similar trend is expected on salary cuts; with the number of organizations planning on cuts is expected to drop from 5.7% in 2009 to 1.9% in 2010.
Despite multiple measures adopted to control costs, interestingly, organizations continue to reward high performers. They maintain a significant level of differentiation on performance-driven pay between high performers and average performers. The high performers on an average received twice the salary increases at top and senior management levels and about 1.7 times the salary increases at lower levels.
Hewitt's Annual Salary Increase Survey in the Middle East 2010 covers organizations across Bahrain, Egypt, Kuwait, Qatar, Saudi Arabia and UAE and spans 19 primary industries and their sub-classifications including Aerospace, Construction, Consumer Products, Financial Services, IT, Pharmaceutical, Real Estate, Professional Services etc.
Mr. Debabrat Mishra, Principal and Consulting Business Leader, Hewitt Associates Middle East, said – "The economic downturn had a significant impact on the Middle East organizations in 2009. expectedly, salary increase projections have dipped from previous years. But an average increase of 7.9 percent can be considered significantly healthy in today's environment. In fact, according to Hewitt's salary studies across global markets, the Middle East salary projections for 2010 are among the highest in the world"
The effect of the economic crisis of 2008 continued to exhibit itself in 2009 compelling nearly 28% of organizations to reduce the year-end performance bonus payout. While 14% organizations reported delayed payment of performance bonus, 19% organizations lengthened the period for salary increase. Other measures adopted by organizations to control costs include reduction in overtime pay with 35% organizations reporting this measure; and trimming perks and benefits to employees with around 8% organizations reporting this measure. Interestingly, around 34% organizations have also reported reducing year end promotions in 2009.
The following table details the salary increase for 2009 and projected increases for 2010 across each of the 6 participating countries:
| Country |
Overall Salary Increase
% (Actual 2009) |
Overall Salary Increase
(Projected 2010) |
| Bahrain |
5.4 |
6.4 |
| Egypt |
10.3 |
10.4 |
| Kuwait |
6.9 |
8.0 |
| Qatar |
5.5 |
7.8 |
| Saudi Arabia |
6.5 |
6.7 |
| UAE |
5.4 |
6.5 |
Source: Hewitt Associates Annual Salary Increase Survey in the Middle East 2009
Detailed country-wise and sector-wise reports are available. Please write in at info.me@hewitt.com.
About Hewitt's Annual Salary Increase Survey in the Middle East 2009
Hewitt Associates recently concluded its 2nd Annual Salary Increase Survey across the Middle East. The survey measures actual and projected salary increases and compensation practices for six specific employee groups – top executive, senior management, middle management, junior management/professional/supervisor, general staff and manual workforce. This year, the study also includes a special section on the economic downturn and its impact on the employment deal. Information used in this report was collected during the period of July 2009 to August 2009.
About Hewitt Associates
With more than 65 years of experience, Hewitt Associates (NYSE: HEW) is the world's foremost provider of HR outsourcing and consulting services. The firm consults with more than 2,300 companies and administers HR, health care, payroll and retirement programs on behalf of more than 300 companies to millions of employees and retirees worldwide. Located in 33 markets, Hewitt employs approximately 23,000 associates.
Hewitt Associates has been operating in Middle East market since 2002. Hewitt's Middle East operations are headquartered in Dubai, which serves as the regional hub for its business. In the region, Hewitt successfully partners with over 100+ clients across different areas of human resource and business support. Hewitt's current client base in the Middle East is spread across all the GCC countries, Egypt, Lebanon and Jordan.
Hewitt offers HR solutions that seamlessly blend its global expertise with a strong regional flavor. The focus areas for consulting in the Middle East reflect the current business requirements in the region.
For more information, please visit www.hewitt.com/middleeast.
Our service offerings in the Middle East include:
- Compensation and Rewards
- Leadership
- Talent and Performance Management
- HR Effectiveness
- Corporate Transactions & Transformation
- Actuarial Services
- Retirement
- Health Care and Benefits
- International HR
- Emerging Workforce Solutions
- Investment Consulting
