UAE non-oil private sector sees strongest hiring since May 2015

Monthly Emirates NBD index says growth in the sector hit a 10-month high in July



Hiring in the UAE’s non-oil private sector reached a 14-month high in July, according to data from Emirates NBD’s monthly Purchasing Managers’ Index (PMI).

The pace of hiring was the strongest since May 2015, contrasting with the trend seen over the second quarter – when employment was either stagnant or barely rising.

Job creation was boosted by a growth in new orders, the report said.

Overall, the index accelerated to a 10-month high in July at 55.3. The seasonally adjusted PMI signalled a rebound in growth, having slipped to 53.4 in June. The latest reading was also above the long-run series average (54.5).

Also read: Hiring in the UAE’s non oil private sector slows further in June

UAE non-oil sector up but job market still a concern

Sharp expansions of output and new work helped the sector gather momentum, along with quicker rises in purchasing activity.

Senior economist at Emirates NBD Jean-Paul Pigat said: “July’s survey suggests that the UAE’s non-oil private sector economy started off the second half of 2016 on a strong footing.

“It is encouraging that despite relatively weak exports, economic momentum is being supported by stronger domestic demand conditions.”

Higher output was key to growth of the non-oil private sector since the rate of expansion was the most marked in nearly a year, supported in turn by a sharp rise in new work.

Successful marketing strategies underpinned the improvement in demand, according to survey respondents.

Growth of total new business was largely centred on the domestic market. However, new export orders fell for the first time in three months.

Increase in purchasing activity was also the fastest in four months, with firms commenting on the start-up of new projects.

The rate of inventory building also picked up. Some respondents said stocks had been accumulated in anticipation of future sales.

On the price front, the rate of overall cost inflation was mostly unchanged since June.

Some respondents said they offered discounts due to greater competition, while others did so in an effort to attract new clients.