According to the latest Purchasing Managers’ Index (PMI) survey released by S&P Global on Wednesday, the country’s Employment Index rose to its highest reading since July 2016 and signalled a solid boost to the job market.
“The jump in employment levels reflected the recent trend of improving demand conditions, with some companies noting that rising new order intakes led to a need for greater labour capacity,” S&P said in its monthly survey.
The UAE’s job market has been very buoyant in the post-pandemic period, driven by strong growth in both oil and non-oil sectors, resulting in an increase in the country’s population since it opened for foreigners after the pandemic. In addition, long-term residency and strong handling of the pandemic boosted confidence among global job seekers.
A survey recently released by Bayt.com revealed that over two-thirds – 67 per cent – of UAE employers are planning to hire new employees in 2023 with sales executives, sales managers, and marketing executives in the highest demand.
The UAE PMI, which reflects an overview of operating conditions in the non-oil private sector economy, rose from 54.3 in February to 55.9 in March, to signal a sharp and quicker improvement in the health of the sector.
David Owen, a senior economist at S&P Global Market Intelligence, said the March PMI reflected concerted efforts by non-oil companies to boost their capacity levels in the face of strengthening demand conditions.
“The sub-indices for employment and stocks of purchases rose to 80- and 60-month highs respectively, signalling notable uplifts in staffing numbers and inventories in the latest survey period,” said Owen.
S&P Global said the rate of new order growth meanwhile picked up to a five-month high in March, as companies highlighted stronger market demand and increased tourism.
“The upturn remained predominantly driven by domestic sales, whereas overall export business was broadly stable in March following a three-month sequence of decline.”
As a result of the strong performance of the non-oil sector in March, the outlook for future activity in the non-oil economy strengthened to a five-month high and was aligned with the average sentiment level seen since the Covid-19 pandemic began. Firms were generally hopeful that continued market growth will provide increased opportunities over the next 12 months.
Owen said the UAE firms are still benefitting from relatively mild inflationary pressures, despite stronger market conditions and increased staffing demand driving a quicker rise in wages.
“This allowed firms to reduce their output charges further in the face of strong market competition, with a number of panellists mentioning extra discounts to customers,” he said.