Mubasher: A large number of companies operating in the GCC countries intend to slightly increase salaries this year.
About 20.96% of firms may approve pay raises with a proportion of 3.5% or less, while 10.51% of companies are expected to freeze salary increases, according to a report released by Informa on Monday.
Companies operating in the GCC market announced that they will likely be forced to slash salaries, the report highlighted.
In the same vein, fewer firms are willing to experiment with adjustments to their healthcare provision packages or with wellness programmes, the report said.
Informa noted that the introduction of the value-added tax (VAT) is “adding caution” to the compensations and benefits of employees in 2018.
Around 58.58% of overall corporations affirmed that they will not take VAT into consideration when deciding on pay raises, while 14.48% said that the recently-imposed tax will be an influencing factor.
Over the course of the last year, the state of salary increases was better than previous survey respondents had forecast.
About 251 companies, or 56.15% of respondents, noted that they gave salary increases of 3.5% or lower, up from the 31.3% who expected they would do so.
Moreover, the report said that attrition rates have been much higher at the beginning of this year compared to the prior-year period.
