The United Arab Emirates (UAE), the unique confederation of seven principalities on the Arabia Peninsula along the coast of the Persian Gulf, comprise one of the wealthiest states on the planet. According to a report in Gulf News, as the UAE continues to diversify away from its still highly lucrative oil industry, in 2014, the non-petroleum sector is expected to emerge as the dominant contributor to GDP. After posting a 4.6 percent economic expansion last year, the UAE is projected to deliver similar growth in 2014.
“The oil sector is unlikely to contribute significantly to the UAE’s [economic] growth in 2014, as substantial increases to crude output in 2011-2013 are now in the base, and supply from Iran, Iraq and Libya is expected to rise this year,” said Khatija Haque, head of Middle East-North Africa [MENA] research at Emirates NBD, a Dubai-based banking group. “We have assumed the UAE’s oil production will increase by around 2 percent this year.” Even though oil production increased by 4.7 percent last year, a recovery in regional economies provided a sharp boost for the non-oil sectors in the UAE as well, particularly in Dubai where the manufacturing and hospitality businesses flourished. “We expect growth to come largely from the non-oil sectors, which are likely to benefit from an improving global growth environment as well as strong domestic and regional fundamentals,” said Jean Paul Pigat, MENA economist at Emirates NBD. “These include supportive fiscal policy in the rest of the GCC [Gulf Cooperation Council], which will continue to spill over into the UAE through trade and tourism; as well as increased consumer and investor confidence in the UAE’s medium and long-term growth prospects.”
However, will the buoyant economy in the UAE attract white-collar professional foreign workers? MRI Worldwide UAE, an affiliate of leading executive search and recruitment organization, MRINetwork, characterizes the job climate in the UAE as “complex” and which poses “challenges” for both expatriates and private companies. One of the many confounding ironies of the labor market in the UAE is that whilst the job market is buoyant many companies, keen to support ongoing growth and development of UAE nationals, ideally try to find suitably qualified local citizens – but in some areas and roles requiring specialist skills there are not enough suitably qualified people available from domestic sources.
The UAE and the Middle East once attracted foreign white-collar workers in droves – attracted by high salaries and appealing perks and fringe benefits. But new realities in a globalized economy have changed all that. “Expats who have previously worked in the region or who have known people working here have the perception that it’s the land of milk and honey,” said Sam Collins, the Dubai-based general manager of MRI Worldwide-UAE. “But expat packages are becoming a thing of the past. The days of companies paying for business class tickets for family vacations, drivers, school fees and other perks are dwindling.”
But Collins also noted that there is a great demand for Arabic-speaking employees in the Middle East, suggesting that Americans, Europeans and others should learn the language to boost their future job prospects. Ms. Collins agreed to speak to International Business Times to discuss some of the complex issues related to finding jobs in the UAE.
IB TIMES: What is driving the recent job growth in the UAE? Is it the petroleum industry or the service sector or something else?
COLLINS: A number of areas are driving the recent job growth. Firstly, both the UAE and Dubai in particular have come out of the global financial crisis faster than other parts of the world, which has meant companies are again feeling positive about the future. Secondly, the recent announcement about the UAE winning the 'EXPO 2020' has given some real ‘buoyancy’ in areas like construction and infrastructure. Of course, the price of oil always affects both Dubai, UAE and the region as a whole and whilst oil prices have not returned to the heights of 2008, they are still strong, which helps to drive the economy and investment.
Dubai itself has spent a considerable number of years building an economy that is not reliant on oil. For example, the growth of the aviation industry in the UAE through privately held Emirates Airlines and Etihad Airways, combined with the investment in such entities as Strata, the aerospace manufacturing subsidiary of Abu Dhabi's state-owned Mubadala Development Co., has added a new manufacturing dimension to the economy.
In addition, the hospitality industry continues to grow with new hotels opening almost monthly and the desire to keep Dubai and the UAE as a destination for major sporting events and exhibitions also helps with this sector. The retail sector, particularly in the area of luxury goods, has also continued to flourish. The real estate market has come back to the fore – property prices are rising and there has been much investment in the market from local, regional and international investors.
Essentially, diversity is the key to the success in Dubai itself and this, of course, is all being driven by the visionary approach of His Highness Sheikh Mohammed bin Rashid Al Maktoum, vice-president and prime minister for the UAE and ruler of Dubai.
IB TIMES: Is UAE trying to gravitate away from too much dependence on oil?
COLLINS: Yes and no. Of course, as a major oil producer they will always be at the forefront of this market along with countries like Saudi Arabia, but the UAE government recognizes that there needs to be diversification.
Investments in areas of alternative energy show that there is a strong recognition of continuing to be involved in energy, but not just in oil. Projects like Masdar City, which is being designed to be ‘the world’s most sustainable city,’ demonstrate the need to continue being innovative and open-minded in today’s energy marketplace.
IB TIMES: If new jobs are restricted to local citizens, will we see a mass exodus of foreigners out of the Emirates? Or do you expect the emirs to make appeals to foreigners due to shortages of qualified candidates?
COLLINS: Not all new jobs are restricted to local citizens, but there is a definite preference in certain sectors like banking, where there is high demand for nationals. Moreover, some positions in certain countries in the region are limited to their nationals however.
For example, in Saudi Arabia, [human resources] roles are now being dedicated to local nationals in an effort to encourage more talent from the country into the private sector. But, whichever way you look at it, the UAE and other countries in the region cannot survive and meet their often ambitious growth plans without the participation of ‘foreign workers’.
In some cases, these foreign workers bring talent that is in short supply in the region – areas like biotechnology, which are growing fast in the UAE, require the expertise bought from overseas as the amount of qualified local talent here is very low.
Manufacturing, engineering and construction also require knowledge, experience and talent from overseas to be able to complete the exciting and often challenging projects in the UAE.
IB TIMES: Are some foreigners scared off from applying from jobs in UAE because of the general fear of unrest and violence in the Middle East?
COLLINS: The UAE is a very stable and well-managed country. The government ensures that it remains peaceful and that the issues impacting other parts of the region do not spill over to the country. Foreigners enjoy living here and nowadays many opt to remain in the country after retirement by investing in property. This is a country where you do not need to ‘lock your doors’ after dark or live in fear of backlashes or reprisals. Generally, people are more than happy to consider jobs and retirement in the UAE, even when it may require regional travel.
IB TIMES: The majority of people living in the UAE are migrant laborers from South and East Asia. What is their current status? Are they part of this economic bonanza? Or does the government want to deport more of them?
COLLINS: The demand for migrant workers continues and there is certainly an ongoing need for many to ensure the economy continues to grow and [construction] projects are completed. There also remain a high number of nationals from other Gulf countries within the UAE and the ability to speak Arabic helps many workers from these countries to secure employment, often away from more ‘troubled’ economies.
With respect to deporting people, the UAE on the whole focuses on two areas; those who are living in the country illegally and those who have committed some form of crime and served prison terms. This is no different from most other countries around the world, apart from the fact that the legal system [here] can often work much quicker.
IB TIMES: Can Westerners in the UAE live comfortably – or do they find themselves under social and cultural restrictions due to the dominant Islamic culture?
COLLINS: Life in the UAE for expatriates is great! There are virtually no restrictions on westerners working in the country. Of course, they need to have realistic expectations when it comes to salaries, but provided they accept this and the benefits of the tax regime – or lack of it -- they can have a good life.
There has been much publicity in recent years regarding expatriates who have come to the UAE and bought expensive cars, run up large debts and fled the country. Thankfully, the majority of westerners who have come lead a lifestyle that does not cause dramatic headlines of this nature -- and many, when they leave, can look back on having provided a worthwhile contribution to the economy in some way.
Life for women in the UAE is also very good. In fact, many single western women have now made the UAE their home, as restrictions on them are minimal. The key is to ‘respect’ the fact you are living in a foreign country and an Islamic country. There is no special request for dress codes for women, although respecting the culture and covering [parts of the body] in public spaces is well received. You also need to respect [the fact] that your Islamic colleagues will want to fast during Ramadan, but most companies also respect that for non-Muslims this can prove a challenge so they will make accommodations for this kind of religious period.
In short, the UAE is a country where every nationality lives harmoniously alongside each other and provides for many expatriate children living with their parents a unique opportunity to experience a truly multicultural society.