| Kippreport.com

How much do you earn compared to them?

October 12, 2010 3:40 by Samuel Potter

A workshop organized by the Dubai Economic Council and the Ministry of Labour has laid bare the gap in costs between hiring a skilled worker and an unskilled worker, according to Gulf News.

The newspaper reports that the average total annual cost of labour per employee in the country is estimated at about AED 55,000. That’s according to figures set out in an academic paper by Dr. Mouawiya Al Awad, Director of the Institute for Social and Economic Research at Zayed University.

But that figure is an average that sheds little light on the true situation: a “skilled” worker in the UAE costs an average of AED 144,000, while an “unskilled” costs just AED 33,000. Most of these costs are associated with wages, of course, but a small chunk relates to recruitment and administration. For skilled workers, overall admin costs associated with recruitment are AED 3,404 per year. For unskilled, that figure is AED 2,296.

The Gulf News observed that: “Despite these costs, hiring foreign workers is an economic advantage to private companies and the UAE economy when comparing the costs to productivity levels, according to the study. This suggests that competitiveness of the UAE economy may be ‘linked strongly’ to using cheap and unskilled workers, [Dr Al Awad] said.”

That will come as no great surprise to anyone familiar with the UAE economy, which has grown fat on cheap real estate development built by unskilled workers largely from the Indian subcontinent. But the difference between the costs of skilled and unskilled labour is not the only gap worth noting in the figures.

Pages: 1 2

Tags: average salaries uae, cost of labour uae, cost of labour workshop, dubai salaries, pay gap between skilled and unskilled, pay gap uae, professional productivity uae, skilled labour costs, skilled labour productivity uae, skilled salary unskilled salary uae, uae competitiveness, uae employment, uae relies on unskilled labour, uae salaries, unskilled labour costs, wages and cost of labour uae, wages uae