Hiring in Gulf under threat amid unrest

Fewer firms in the Middle East are hiring new employees as concern grows over regional unrest.

Companies in the region are hiring less as unrest causes many of them to adopt a cautious stance.

Only 34 per cent of companies in the Middle East said they were hiring at the professional and managerial level in January and last month, according to a survey from Antal, an international recruitment company.

That compares with 56 per cent of firms that said they were hiring in the September and October period, the last time Antal conducted its survey.

While many of the companies that downsized during the economic downturn saw signs of recovery in the second half of last year and were hiring briskly in response, they are now largely preparing for "slow, steady growth", said Nizar Lalani, the chief executive of Antal in the UAE. "Now they are right-sizing," he said.

At the same time, more employers also seem to be hedging their bets and refraining from hiring en masse in case the region's instability continues, experts say.

In recent weeks, political unrest similar to that seen in North Africa has occurred in the Middle East, with protests in Jordan, Bahrain and Oman.

"The unrest makes companies cautious," said Konstantina Sakellariou, a partner at Stanton Chase International, an executive recruitment firm with an office in Dubai. "It's a very volatile market," she said.

While the report from Antal also found that 46 per cent of companies in the Middle East expected to hire at the managerial and professional level in the next quarter, it warned that continuing political events might affect this figure, "and it remains to be seen how these political changes will affect employment rates".

Even in the UAE, where there is no unrest, hiring so far this year has fallen compared with last autumn.

Nearly half - 46 per cent - of companies here took on employees at more senior levels, although that was down from 53 per cent in September and October last year.

Other nearby countries have fared better overall: in Qatar, 73 per cent of firms have recently been hiring, while 76 per cent of businesses in Saudi Arabia have added workers.

Many industries in the Middle East have also been shedding staff as economic growth becomes increasingly threatened. Businesses in software technology, accounting and banking or financial services reported the highest levels of layoffs.

Leisure and tourism are also being affected: 10 per cent of companies in this field were reducing staff earlier this year, while another 10 per cent expected to follow suit over the next quarter. With the Middle East getting fewer visitors overall, many hotels are trying to predict how employment levels may be affected later this year.

"Big hotel chains are re-looking at their revenue projections," says Joanna Savvides, the chief executive of Signature Holdings (Cyprus), which provides training programmes for the hospitality industry in the Mena region. "The smaller hotels will also be affected," she says.

Yet not all hotels and tour operators are cutting staff. Some in the UAE have been hiring as the number of tourists visiting one of the most stable parts of this region continues to grow, experts say.