Dubai is getting by with less as the emirate’s economic turnaround leaves a trail of job losses. Although business confidence is on the rise, narrowing margins are forcing companies to keep their payrolls tight as selling prices fall. An employment index compiled by Emirates NBD dropped to 49.9 last month, the lowest since February, even as the bank’s Dubai Economy Tracker continues to hover near a four-year high.
“Firms remain reluctant to boost headcount," Khatija Haque, head of Middle East and North Africa Research at Emirates NBD, said in a report.
Employment in the labor-intensive tourism industry was in contraction through the second quarter, a period when the sector had the best performance since the survey began in 2015. Even in wholesale and retail, where employment was “marginally higher" in June, only 1% of firms indicated an increase in hiring.
The discrepancy was especially jarring in Dubai’s bellwether construction industry. Although output rose at a record pace and new orders accelerated, employment fell for a third straight month.
“This highlights the focus on efficiency and productivity in an environment of declining selling prices and margin compression for many businesses," Haque said.
This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.