Most Dubai Firms Will Not Hike School Allowances In 2014 – Survey

Only a quarter of Dubai firms will increase schooling allowance for employees this year, says a Mercer study.



Only 24 per cent of companies in Dubai are considering raising school allowances in 2014, while the number stands at 19 per cent in Abu Dhabi, according to a new survey by global consultancy Mercer.

However, those numbers are still higher than 2013, when only 13 per cent of Dubai firms and seven per cent of Abu Dhabi firms upped school allowances.

Despite a larger proportion of companies looking to hike school allowances, the survey estimates that the increase will be lower than the previous year for local firms.

School allowances are predicted to rise just 12 per cent in Dubai this year, down from 15 per cent in 2013. Companies in Abu Dhabi are forecast to hike school allowances by 10 per cent, down from 16 per cent last year.

The survey also indicated that not all employees may enjoy increased schooling allowance. Only 61 per cent of companies polled in Dubai said that the hike would apply to all employees while 85 per cent of firms in the capital said that it will apply across the board.

“Our Spot Survey on Housing and Schooling Allowances Increases in the UAE revealed that there was a greater percentage of organisations in Dubai than Abu Dhabi who claimed to be considering school allowance increases,” said Nuno Gomes, information solutions business leader Middle East, Mercer.

“However, those companies in the capital that were considering rises were applying them to more categories of workers.”

He added that a number of companies in various industry sectors are looking to increase the level of school allowances over the next 12 months.

“What has come through from the poll is that if you are an employee in Abu Dhabi, you are less likely to be working for an organisation that is considering such a rise,” said Gomes.

“However, if your company in Abu Dhabi is one that is considering a rise, you are more likely to benefit than an employee in Dubai whose organisation is also considering a rise.”

A rising population has inflated demand for schools in the UAE causing educational expenses to surge in the country.

According to a HSBC survey released last year, the majority of expats polled said that the cost of education is higher in the UAE than their country of origin.

Dubai’s inflation rate, which touched 2.17 per cent in January, was mainly driven by the increasing cost of education in the emirate, Dubai Statistics Centre revealed earlier this year.