DUBAI: Average salary increases in the Gulf dropped sharply to 6.2 percent from an average of 11.4 percent last year. More strikingly, almost 60 percent of employees received no pay increase at all, compared to just 33 percent over the same period last year, according to a new study on employment and salary trends in the Gulf 2009-2010. The study prepared by Dubai-based GulfTalent.com covers the job market in Saudi Arabia, Kuwait, Qatar, Bahrain, Oman and the UAE including Dubai, following the crisis in the wake of the world economic downturn.

With the balance of power shifting to employers this year, the increases observed had much to do with the momentum of the previous year and previous inflationary trends that had yet to be reflected into pay packages. Most increments this year either took effect or had already been promised prior to January 2009, when the full extent of the slowdown gripping the region started to become apparent. Data from candidates confirm that, after January, the pace of salary increases slowed down significantly relative to the same period last year, according to the study.

On a regional basis, Oman secured the largest average increase at 8.4 percent, though still much lower than last year. Qatar, Bahrain and Saudi Arabia had similar increases of around 7 percent. Kuwait had the smallest rise at just 4.8 percent while professionals in the UAE saw a pay increase of 5.5 percent, down sharply from 13.6 percent in the previous year.

On a sector basis, accounting and audit companies saw the biggest average rise at 7.9 percent, as concern about the financial health of firms boosted demand for audit services. Next was construction at 6.8 percent, down sharply from last year’s figure of 15.1 percent. This reflects partly the huge momentum in the sector’s pay rises carried over from last year, as well as growth in infrastructure projects. Investment firms offered the smallest pay rises this year.

Bonuses saw a drastic cut in 2009. This was most visible in investment banking and top management positions across all sectors, where the bonus often represents over half of the total package.

Many companies cut staff during 2009, with an estimated 10 percent, or one in ten professionals, losing their jobs.