Jeremy Williams, the founder of Handshaikh, notes ample preparation for a negotiation is the key to getting a salary increase.
Jeremy Williams, the founder of Handshaikh, notes ample preparation for a negotiation is the key to getting a salary increase.

UAE workers should wait to ask for pay rise



Now that business is picking up for many companies across the Emirates, is it a good time to talk to the boss about finally getting that raise?

More workers may be considering the question as many in the Middle East feel salaries have not kept pace with the rising cost of living.

Only 3 per cent of professionals in the UAE said they were "highly satisfied" with their salary, while 47 per cent indicated a low level of satisfaction, research from the job-search site Bayt.com and the polling company YouGovSiraj shows.

The issue is compounded for some, for whom salaries have actually fallen recently.

Middle managers in the UAE who receive a proportion of their earnings in bonuses and profit share had remuneration fall 9 per cent between 2008 and last year, according to data released last month by Towers Watson, a New York human resources consultancy.

"Bonuses and profit share are an important part of the overall reward package," says Anne Severeyns, the head of data services operations for Europe, the Middle East and Africa at Towers Watson.

"Variable pay such as this, vitally, offers employers the ability to manage cost and performance, as well as rewarding and retaining key talent."

In spite of the recent upturn in the region's economy, with growth expected to top 3 per cent this year, some experts suggest waiting a little longer to ask for more money from an employer.

"It may be just too soon at this moment," says Jeremy Williams, the founder of Handshaikh, a UK consultancy that works with western businesses in the Gulf.

"I think we want to see the flower bloom a bit stronger before we start demanding extra salaries."

But Mr Williams notes it helps to be prepared for negotiation and there is much information employees can gather in their favour to use when the time is right.

For starters, visit websites that may provide sample salaries for different positions, or other perks workers may receive. Bayt.com features a section that highlights average earnings for popular jobs such as accountancy, project engineering and sales management in the UAE.

PayScale.com provides the average number of holidays residents in the Emirates earn based on how many years of experience they have in the workforce.

Be sure to provide concrete reasons for a pay rise request, experts say. It helps to have quantifiable facts, such as how directing a certain marketing campaign led to a 15 per cent increase in sales.

But what is most important in this region, particularly if a manager is an Arab, is to make the request face to face.

"I doubt any request for a raise will be successful unless one deals at a personal level," says Mr Williams. "It's best to do things in a low-key meeting after you've personally brought some success to the company."

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Other ways to buy used products in the UAE

UAE insurance firm Al Wathba National Insurance Company (AWNIC) last year launched an e-commerce website with a facility enabling users to buy car wrecks.

Bidders and potential buyers register on the online salvage car auction portal to view vehicles, review condition reports, or arrange physical surveys, and then start bidding for motors they plan to restore or harvest for parts.

Physical salvage car auctions are a common method for insurers around the world to move on heavily damaged vehicles, but AWNIC is one of the few UAE insurers to offer such services online.

For cars and less sizeable items such as bicycles and furniture, Dubizzle is arguably the best-known marketplace for pre-loved.

Founded in 2005, in recent years it has been joined by a plethora of Facebook community pages for shifting used goods, including Abu Dhabi Marketplace, Flea Market UAE and Arabian Ranches Souq Market while sites such as The Luxury Closet and Riot deal largely in second-hand fashion.

At the high-end of the pre-used spectrum, resellers such as Timepiece360.ae, WatchBox Middle East and Watches Market Dubai deal in authenticated second-hand luxury timepieces from brands such as Rolex, Hublot and Tag Heuer, with a warranty.

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Name: Kumulus Water
 
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Sector: Water technology 
 
Number of staff: 22 
 
Investment raised: $4 million 

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

Real estate tokenisation project

Dubai launched the pilot phase of its real estate tokenisation project last month.

The initiative focuses on converting real estate assets into digital tokens recorded on blockchain technology and helps in streamlining the process of buying, selling and investing, the Dubai Land Department said.

Dubai’s real estate tokenisation market is projected to reach Dh60 billion ($16.33 billion) by 2033, representing 7 per cent of the emirate’s total property transactions, according to the DLD.

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In the village of Mevagissey in southwest England the housing stock has doubled in the last century while the number of residents is half the historic high. The village's Neighbourhood Development Plan states that 26% of homes are holiday retreats. Prices are high, averaging around £300,000, £50,000 more than the Cornish average of £250,000. The local average wage is £15,458. 

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