Dubai companies not hiring despite stable economy

Employment declined in February after three months of almost no change, as 5 percent of firms reported lower headcount last month, the latest Dubai Economy Tracker Index report said. (AFP file photo)
Updated 11 March 2019
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Dubai companies not hiring despite stable economy

  • ‘The lack of job growth in Dubai over the last couple of years has weighed on private consumption’
  • The emirate’s wholesale and retail sector, in general, was a bright spot during the period

DUBAI: A stable Dubai economy has not translated into higher employment for private sector companies, with some even reporting lower headcount last month, the latest Dubai Economy Tracker Index shows.
“Employment declined in February after three months of almost no change, as 5 percent of firms reported lower headcount last month, compared with 1.8 percent of firms reporting new hires. The employment index fell to the lowest level since the series began in 2010,” Khatija Haque, head of Middle East and North Africa research at Emirates NBD, said in a statement.
“The lack of job growth in Dubai over the last couple of years has weighed on private consumption, and likely contributed to the increased pressure on firms to cut prices in order to boost their sales and new work, which in turn has eroded margins and reduced firms’ willingness to hire more staff, perpetuating a negative cycle.”
Dubai’s non-oil private sector remained stable in February, with the Dubai Economy Tracker Index unchanged at 55.8, as stronger “output growth was offset by slightly softer growth in new work and a record decline in employment.”
The emirate’s wholesale and retail sector, in general, was a bright spot for during period as output and new orders rose expanded at their fastest rate since June 2018 due to further price discounting. Outlook for the sector also remained highly optimistic, with 80 percent of the surveyed companies expecting higher outputs 12 months onwards.
Dubai’s the travel and tourism sector also reported the fastest growth since May 2018, as both output and new work increased at a sharper rate last month. Companies however reported lower headcount in February, compared with the previous month, as their likely focus on improving efficiencies amid tighter competition meant lesser demand for staff.
Government tourism information indicates the supply of hotel rooms in Dubai rose nearly eight percent annually in 2018 but overall international visitors during the same year was almost unchanged at 15.92 million. The denser hotel market dented revenue per available room to 354 dirhams in 2018, from 383 dirhams the previous year.
Dubai’s construction sector index meanwhile was marginally higher at 54.0 in February, from 53.8 the previous month, with output driven by Expo 2020-relate projects scheduled for completion this year.


Boeing made mistake in handling warning-system problem: CEO

Employees work in the cargo hold of a Boeing 727 MAX 9 test plane outside the company's factory, on March 14, 2019 in Renton, Washington. (AFP)
Updated 9 min ago
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Boeing made mistake in handling warning-system problem: CEO

  • Airbus executives said the Max crashes aren’t affecting their sales strategy, but are a reminder of the importance to the whole industry of ensuring safety

PARIS: The chief executive of Boeing said the company made a “mistake” in handling a problematic cockpit warning system in its 737 Max jets before two crashes killed 346 people, and he promised transparency as the aircraft maker works to get the grounded plane back in flight.
Speaking before the industry-wide Paris Air Show, Boeing CEO Dennis Muilenburg told reporters Boeing’s communication with regulators, customers and the public “was not consistent. And that’s unacceptable.”
The US Federal Aviation Administration has faulted Boeing for not telling regulators for more than a year that a safety indicator in the cockpit of the top-selling plane didn’t work as intended.
Boeing and the FAA have said the warning light wasn’t critical for flight safety.
It is not clear whether either crash could have been prevented if the cockpit alert had been working properly. Boeing says all its planes, including the Max, give pilots all the flight information — including speed, altitude and engine performance — that they need to fly safely.
But the botched communication has eroded trust in Boeing as the company struggles to rebound from the passenger jet crashes in Indonesia and Ethiopia.
“We clearly had a mistake in the implementation of the alert,” Muilenburg said.
Pilots also have expressed anger that Boeing did not inform them about the new software that’s been implicated in the fatal crashes.
Muilenburg expressed confidence that the Boeing 737 Max would be cleared to fly again later this year by US and all other global regulators.
“We will take the time necessary” to ensure the Max is safe, he said.
The model has been grounded worldwide for three months, and regulators need to approve Boeing’s long-awaited fix to the software before it can return to the skies.
Muilenburg called the crashes of the Lion Air and Ethiopian Airlines jets a “defining moment” for Boeing, but said he thinks the result will be a “better and stronger company.”
In the United States, Boeing has faced scrutiny from members of Congress and the FAA over how it reported the problem involving a cockpit warning light.
The feature, called an angle of attack or AoA alert, warns pilots when sensors measuring the up-or-down pitch of the plane’s nose relative to oncoming air might be wrong. Boeing has admitted engineers realized within months of the plane’s 2017 debut that the sensor warning light only worked when paired with a separate, optional feature but didn’t report the issue for more than a year, after the crash in Indonesia.
The angle-measuring sensors have been implicated in the Lion Air crash in Indonesia last October and the Ethiopian Airlines crash in March. The sensors malfunctioned, alerting anti-stall software to push the noses of the planes down. The pilots were unable to take back control of the planes.
Boeing told the FAA of what it learned in 2017 after the Indonesia crash.
Pilot Dennis Tajer, a spokesman for the union that represents American Airlines pilot, the Allied Pilots Association, said it’s good Muilenburg was willing to revisit the cockpit alert problem and to acknowledge Boeing mishandled conveying information.
But Tajer said he thinks Boeing made a series of unprecedented communication missteps that have “created a massive headwind to rebuilding trust.”
Restoring trust in the Max is Boeing’s No. 1 priority, Muilenburg said — ahead of an upgraded 777 and work on its upcoming NMA long-range jet.
The Max, the newest version of Boeing’s best-selling 737, is critical to the company’s future. The Max was a direct response to rival Airbus’ fuel-efficient A320neo, one of the European plane maker’s most popular jets; Airbus has outpaced Boeing in sales in the category.
The Max crashes, a slowing global economy, and damage from tariffs and trade fights threaten to cloud the mood at the Paris Air Show. Along with its alternating-years companion, the Farnborough International Airshow near London, the Paris show is usually a celebration of cutting-edge aviation technology.
Muilenburg forecast a limited number of orders at the Paris event, the first major air show since the crashes, but said it was still important for Boeing to attend to talk to customers and others in the industry.
He also announced that Boeing was raising its long-term forecast for global plane demand, notably amid sustained growth in Asia.
Boeing expects the world’s airlines will need 44,000 planes within 20 years, up from a previous forecast of 43,000 planes.
Muilenburg projected that within 10 years, the overall aviation market — including passenger jets, cargo and warplanes — would be worth $8.7 trillion, compared to earlier forecasts of $8.1 trillion.
Both estimates are higher than the ones from Airbus, which sees slower growth ahead.
However, Airbus is heading into the Paris show with confidence. It is expected to announce several plane sales and unveil its A321 XLR long-range jet. Airbus executives said the Max crashes aren’t affecting their sales strategy, but are a reminder of the importance to the whole industry of ensuring safety.