JEDDAH – Middle East employees can look forward to an average 5.4 percent raise in pay for 2013, with workers in Saudi Arabia expected to receive the highest rate, the latest Total Remuneration survey conducted by Mercer released Sunday said. Estimates for inflation are lower than this figure, which means the predicted increases will result in a real pay growth for the working population – a clear reflection of development in the region. The study coincides with the Salary Movement Snapshot, which tracked pay plans of 570 multinational organizations operating across 76 countries in EMEA. The data provides information from multinationals on median base pay increases across all employee groups including ‘blue' and ‘white collar' workers up to management and the Senior Executive level. The Middle East and Africa has the largest variation in forecast pay increases due to the diverse nature of the region. Companies in Morocco (4.9 percent), Tunisia (5.3 percent) and Algeria (6.8 percent) are predicting high pay increases to employees compared to those in Western Europe, while employees in Egypt and South Africa are anticipated to receive 10 percent and 7 percent, respectively. Companies in Africa are anticipating average increases of 8 percent and companies in the Middle East expecting to give employees increases of 5.4 percent in 2013. General salary increase expectations in the GCC region range from 5 to 6 percent, UAE (5.0 percent), Bahrain (5.0 percent), Oman (5.1 percent), Qatar (5.2 percent) and Kuwait (5.4 percent), while Saudi Arabia is anticipated to enjoy the highest increase in pay of 6 percent in 2013. These figures have remained relatively unchanged over the last couple of years, a sign of the region relative economic stability and mature business environment. Zaid Kamhawi, Middle East Business Leader for Information Product Solutions at Mercer said: “Anticipated pay increases are affected by consumer price inflation, the anticipated pay increase in 2013 are predicted to be above the forecasted inflation generating real pay growth for employees.” “Companies however are placing less emphasis on inflation rates when budgeting for pay increases, and factoring such variables as relative pay competitiveness, affordability, labor market conditions and confidence in their business outlook.” “In 2012, like in other regions, we saw the introduction of salary freezes in a number of Middle East markets. Our forecast shows that an estimated 5 percent of companies will look to freeze salaries in 2013 across the region. The Middle East region showed the lowest and healthiest figures across the ME and Africa region in terms of salary freezes.” The picture is varied across EMEA, with rates of pay inflation for workers in other parts of Europe outpacing that of employees in Western European nations. Across Western Europe, on average, companies are predicting employee pay rises of 2.6 percent in 2013, marginally lower that the average of 2.7 percent awarded in 2012. By comparison to Western Europe, the rates of pay increases in Central and Eastern Europe are much higher at 4.6 percent. Multi-nationals may have smaller operations in many of these countries and currency considerations may mean that even though the increases appear high, they may not actually translate into a large cost for multinationals. “The figures provided are figures which Compensation and Human Resource Managers – those responsible for planning salary increases – are forecasting in each country. These forecasts, of course, have to be approved by company management and depend on numerous economic factors, as well as an individual employee performance,” Kamhawi said. — SG
