Dubai's companies increase hiring at fastest pace in three years in October

Increase in recruitment signals a robust degree of expansion

Dubai's economy, which made a strong rebound last year from the coronavirus-induced slowdown, has carried the growth momentum into this year. Reuters
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Business activity in Dubai's non-oil private sector economy was "robust" in October as companies increased their headcounts at the fastest pace in about three years amid stronger new orders.

The emirate's headline seasonally adjusted S&P Global purchasing managers' index reading stood at 56, above the neutral 50 mark separating expansion from contraction.

While the reading was softer than the 56.2 reading in September new business inflows continued to rise at one of the sharpest rates since mid-2019, according to the survey.

All of the sectors covered by the survey grew at considerable rates, led by the sharpest upturn in wholesale and retail since July 2019.

"Employment levels rose at the fastest rate for nearly three years as firms looked to boost labour capacity and prepare for higher workloads," said David Owen, an economist at S&P Global Market Intelligence.

"At the same time, lower commodity prices and reduced transport costs helped to push business expenses down for the second time in three months, enabling a solid reduction in output charges."

A reduction in prices helped underpin stronger demand, with output charges decreasing the most since August 2020, while input prices declined for the second time in three months.

The increase in activity across all sectors in the survey was a result of "a marked uplift in new order inflows" and the rate of sales growth edged up from September and was one of the strongest recorded for over three years.

Higher demand levels accelerated the rate of job creation, which was the fastest November 2019.

A renewed fall in expenses during October, the second reduction in the past three months, was attributed to lower oil and transport prices.

Oil prices, which rose sharply after the 23-member Opec+ group of oil producers announced an output cut of 2 million barrels per day on October 5, have softened again on China demand concerns, a slowing global economy and rising interest rates amid higher inflation.

Dubai's non-oil companies reduced their selling prices in October as cost pressures eased, marking the fastest level of discounting for more than two years, with the wholesale and retail sector registering the sharpest decline, according to the survey.

Dubai's economy, which made a strong rebound last year from the coronavirus-induced slowdown, has carried the growth momentum into this year, supported by the travel and tourism sector and its rapidly improving property market.

The emirate's economy grew by 6.2 per cent in 2021, according to preliminary data from the Dubai Statistics Centre. In the first three months of this year, Dubai's gross domestic product expanded 5.9 per cent, according to government data.

Updated: November 09, 2022, 5:27 AM