UAE Salary Growth Surpasses Living Costs Amid Talent Demand 2024

The UAE job market is witnessing a significant uptick in salaries, outpacing the inflation rate, buoyed by heightened demand for talent and economic growth. Mercer’s projections indicate a 4% salary increase, surpassing the 2.3% inflation rate, reflecting stability and opportunities in the Emirates.

However, rising living costs, particularly soaring rents, pose challenges for residents, prompting a shift towards home insurance. Moreover, as Ramadan approaches, retailers anticipate a surge in consumer spending, particularly on wellness and electronic gadgets, contributing to an optimistic sales outlook for the season.


The employment landscape in the United Arab Emirates (UAE) is experiencing a significant shift as companies navigate the challenges of talent acquisition and retention amid changing economic conditions. Amidst this backdrop, projections suggest that salaries in the UAE will outpace the rise in the cost of living this year, offering a glimmer of optimism for professionals and organizations alike. Let’s delve into the factors driving this trend and explore the implications for the UAE job market.

  1. Salary Projections and Economic Outlook:
    According to insights from global human capital consultancy Mercer, the average salary in the UAE is poised to increase by 4 per cent this year, surpassing the 2.3 per cent rise in inflation. This positive trajectory reflects the growing demand for skilled talent and a buoyant economy marked by stability and growth.
  2. Cost of Living Challenges:
    Despite the promising salary outlook, challenges persist, particularly concerning the rising cost of living. Factors such as escalating rents, fueled by increased migration and real estate dynamics, pose financial strains on residents. The recent recalibration of rent calculators by the Real Estate Regulatory Authority (RERA) has further exacerbated housing costs, prompting concerns among employees.
  3. Talent Competition and Retention Strategies:
    The UAE’s allure as a regional hub for employment has intensified competition among companies vying for top talent. Local and multinational firms are actively recruiting from the UAE talent pool, leading to talent poaching and retention challenges. To mitigate attrition risks, organizations are exploring various long-term and short-term incentive schemes to retain critical talent.
  4. Emiratisation and Workforce Dynamics:
    Emiratisation remains a focal point for private sector organizations, with efforts underway to attract and integrate Emirati talent into the workforce. Despite progress, there is still untapped potential, particularly among Emirati women, highlighting opportunities for inclusive workforce participation and diversity initiatives.
  5. Economic Impact and Hiring Trends:
    Insights from the Mercer Middle East Total Remuneration Survey for 2024 shed light on hiring intentions across UAE firms, with 16.3 per cent planning to increase headcounts. While economic uncertainties persist, the majority of companies are adopting a cautious approach, neither adding nor reducing their workforce significantly.
  6. Retail Sector Dynamics During Ramadan:
    Beyond the job market, the retail sector anticipates a surge in consumer activity during the holy month of Ramadan. Retailers are gearing up to capitalize on heightened spending patterns, leveraging insights from previous years to tailor marketing strategies and product offerings. From consumer electronics to wellness products, retailers are anticipating shifts in consumer preferences and spending behaviors during Ramadan.


The UAE job market is poised for dynamic shifts in the coming year, with salary growth outpacing the cost of living increase. While challenges persist, opportunities abound for organizations to attract, retain, and develop talent in a competitive landscape. As the economy continues to evolve, proactive strategies and adaptive measures will be key to navigating the complexities of the UAE employment landscape.

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