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Will there be an exodus from Dubai?
The UAE labor minister said that the job market in the UAE has been affected by the global financial crisis. But is the worst yet to come?
June 18, 2009 11:55 by Aarti Nagraj
The UAE Labor Minister, Saqr Ghobash has said that although the global financial crisis will only have a “limited” effect on the UAE job market, the recruitment and job creation in the country will continue to be at lower rates compared to the last two years, reports UAE official news agency, WAM.
“It is not anticipated that unemployment rates will increase among the UAE workforce, the majority of whom are expatriates,” he said during an International Labor Organization (ILO) conference. “What is anticipated is a slow-down in the rate of arriving workers, coupled with a slight increase in the number of those who leave the country on completion of the projects for which they were brought. It is also expected that access by UAE citizens to the job market in the private sector will be faced with some challenges, given the fact that dwindling growth rates will limit the creation of lucrative job opportunities in this sector.”
And that is already being reflected in the market. The UAE is currently seeing the highest unemployment rate among nationals since the country was founded 38 years ago, with more than 40,000 Emiratis of working age without a job, reports Emirates Business. Abdullah Al Awadi, a consultant at the National Human Resources Development and Recruitment Authority (Tanmia), said the rise in the local unemployment rate was because of a “continuous influx of expatriate labor and obstacles in the implementation of job nationalization plans,” says the report.
However, it’s not just locals who’ve been affected; in January this year, financial firm UBS said in a report that Dubai’s population could fall 8 percent this year because of the global economic downturn. “A slowdown in the housing market in addition to challenging macro-conditions may lead to fewer foreign workers moving to the region for job opportunities and fewer investors engaging in local investments including real estate assets,” analyst Saud Masud said in the note.
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