RIYADH: As 2020 draws to a close, the full impact of the coronavirus pandemic on the GCC job market has been revealed.
In their 2021 KSA and UAE salary guides, HR and recruitment advisory firm Cooper Fitch showed how much the job market was disrupted this year, as companies were forced to delay decisions on hiring new staff and awarding bonuses and pay rises.
However, despite persistently high levels of market uncertainty, fewer firms than expected said they made redundancies in 2020, and basic salary ranges and performance goals remained unchanged.
Trefor Murphy, CEO and founder of Cooper Fitch, said that the key finding from the salary guides was the continued high level of uncertainty among businesses, a trend the firm predicts will continue until factors negatively impacting the market gradually improve throughout 2021.
“Many of the companies we surveyed have some big decisions to make at the start of 2021, as a significant proportion had yet to decide if they would implement a merit salary increase for staff next year or pay out agreed bonuses for 2020,” he said.
“Our advice is to make these budgetary decisions now, to give your organization as much clarity as possible on how its operations will function as we enter the new year,” he added.
However, Murphy said that despite both local and national challenges, Cooper Fitch believed that both KSA and the UAE have “extremely resilient” markets with good bounce-back power.
“We also have the prospect of an approved COVID-19 vaccine on the horizon, which should further invigorate business and consumer sentiment and positively impact the recruitment market in 2021,” he added.
The salary guide revealed that in both markets, well over a quarter of organizations interviewed said there had been no changes to their recruitment practices in 2020, and that they were still hiring for replacement positions.
More than half of organizations interviewed in both markets said business activity was either busy or had started to pick up by the fourth quarter of 2020, pointing to a resurgence in sentiment and growth ahead of the new year.
The primary findings from the KSA market showed that 79 percent of companies had made no redundancies in 2020, 56 percent said business was either busy or had started to pick up by Q4 and 23 percent said they had implemented a hiring freeze across all roles in 2020.
The guides found that 22 percent of respondents thought that only essential roles would be replaced, 37 percent said they would implement a merit salary increase for staff in 2021 and 41 percent of companies said they would pay bonuses for 2020.
However, 24 percent of respondents said they were undecided, while 34 percent said they would only partially pay them, or not at all. Just over a third (35 percent) said there would be no changes to existing staff salaries in 2021.
A sizable proportion of KSA firms said they would increase salaries in 2021, but many were unsure, and an even greater percentage had yet to decide whether to pay 2020 bonuses. Respondents’ priorities for the year ahead was to finalize 2021 budgets and make bonus decisions, followed by contingency planning and “manpower planning,” which means hiring new staff and addressing skill gaps.
In both the UAE and KSA, technology, advisory and financial services firms performed the strongest amid a challenging 2020, while real estate and the public sector struggled the most.