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Up to 20% of GCC firms to freeze pay rises amid economic downturn

Up to 20% of GCC firms to freeze pay rises amid economic downturn

Benefits such as bonuses could also be affected as earnings predicted to grow at slowest rate in three years in 2016

Workers in the Gulf Cooperation Council are to be hit by pay freezes and shrinking bonuses as companies prepare for an economic dip in 2016, according to a report.

Around 15 to 20 per cent of companies in the region are likely to exercise caution on staffs’ wages, with workers in the United Arab Emirates to receive the lowest increase in real earnings, advisory firm Korn Ferry has found.

Meanwhile in contrast, workers globally are likely to see real incomes growing faster at 2.5 per cent – the highest in three years.

Growth in real earnings in GCC countries will average 2.3 per cent; the highest is predicted to be in Oman, at 3.1 per cent, followed by Qatar (2.9 per cent), Bahrain (2.7 per cent), Saudi Arabia (2.6 per cent) and Kuwait (1.6 per cent).

Though UAE workers will see a 5 per cent increase in their salaries next year, the real growth in incomes will only be 0.9 per cent – the lowest in the region – once inflation is taken into account.

Elsewhere, employees in Asia will see bigger pay increases averaging at 6.4 per cent, while real wages are expected to rise by 4.2 per cent, making it the highest globally.

In the United States, real income growth will be around 2.7 per cent.

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