Although unbelievable, there's a noticeable downtrend and sudden slowdown in the UAE Job Market. All the local firms, multinationals, and FDI's operating in Dubai started restructuring their employee portfolio to streamline their business operations.
It is, in fact, a dim outlook for the nation's economy, which is mostly influenced by various external factors. Probable causes are the weak demand and the latest Corona Virus outbreak in China. Economists are hoping that it’ll take some time for the job market to recover.
Until now, it's a significant concern for Dubai, the Emirates hosting the World EXPO 2020 trade exhibition. Despite Dubai being the commercial hub of the Middle East, jobs started disappearing from the market in the First Quarter of this year at a faster pace.
It is not a good indication and a sign of concern. The non-oil private sector firms registered massive degrowth in the month of January. It has happened consecutively for the third time in the last three months and the lowest in the previous four years.
London–based global information provider, IHS Markit shared this information based on their survey report on the Middle East’s economy. They further stated in their report that the Purchasing Managers’ Index registered a noticeable drop to 50.6.
David Owen, who works as an economist in the IHS Markit, further said, “Employment in Dubai was notably affected, with companies reporting the joint-quickest fall in job numbers seen throughout the 10-year series history. Firms expect a little pick-up in sales shortly.”
The situation persists with all retail, wholesale, and construction sector in Dubai. Since May 2018, Dubai has been facing a slow decline in the job market with an increasing number of layoffs.
Emirates NBD, the biggest bank in Dubai, had to lay off over thousands of their employees due to the aforesaid economic slowdown. Last month, the overall business condition in the UAE was worst than ever, and it happened for the first time.
IHS Markit’s survey report further states that there has been a slight improvement in the Dubai tourism industry in January. However, there’re increasing concerns for a downfall in Dubai’s tourism industry owing to China’s viral outbreak and the ongoing geopolitical tensions.
Dubai already invested over 17% of its planned budget for the upcoming EXPO 2020 with high hopes for future economic expansion. Emirates NBD’s Middle East and North Africa’s research head, Khatija Haque, said, “The coronavirus will likely weigh on transport, logistics, and tourism -- in the first quarter at least.” It means the job market will not pick up immediately, and the economy is expected to face a slowdown for some time.