After a busy weekend of car racing, there is no hitting the brakes for professionals in the UAE this weekNovember 29, 2015 10:12
Consumer Confidence on upward trajectory in UAE, rising for the second time this year, latest Bayt.com and YouGov survey reveals
48% expect business conditions to be better and 40% believe economy will improve after a year
October 7, 2009 8:53 by Aarti Nagraj
48% expect business conditions to be better and 40% believe economy will improve after a year
Dubai, UAE, 04 October 2009 – Residents across the UAE are feeling a marked improvement in economic conditions, as consumer confidence rises for the second time this year, according to the latest Consumer Confidence Index (CCI). The Consumer Confidence Index, a quarterly survey conducted by the Middle East’s number one job site – Bayt.com in conjunction with research specialists YouGov, found that the UAE moved up the index by 9.3 points, continuing the country’s course of improved consumer confidence from the last quarter.
The survey showed that respondents felt certain features of their economic positions were unchanged from the previous year. More than a third of respondents, 34%, felt that they were in the same financial position as last year, while the same number agreed that their country’s economy was unchanged. Unsurprisingly, respondents are optimistic about the future. Almost half of respondents, 48%, said that they believe business conditions will be better, and 40% said they think their country’s economy will improve in a year’s time.
Across the rest of the Middle East, consumer confidence levels showed a positive increase. Confidence in Kuwait rose the highest among the surveyed countries with an increase of 10.0 points, and as in the previous wave, Kuwait and the UAE retain the two top spots in terms of improved confidence. While Qatar followed with a strong increase of 9.0 points, the picture around the rest of the Gulf varied, with an increase of 5.1 points in Bahrain and 3.4 in Saudi Arabia.
Despite being one of the only countries in the Middle East to record a consistent improvement in consumer confidence over the past year, Lebanon in this wave was the only country to deteriorate, moving down the index by 0.7 points. By comparison, Syria showed a significant improvement of 5.6 points.
In North Africa, Egypt and Morocco topped the table in terms of improved consumer confidence, moving up 7.7 and 6.7 points respectively, contrasted with a move up the index of just 2.6 points in Algeria.
The Consumer Confidence Index (CCI) is a measure of consumer expectations and satisfaction of various elements of the economy including inflation, job opportunities and the cost of living.
“While we are not seeing massive jumps up the index, the data shows that there are steady improvements, which reflects what is being reported and felt in economies around the region– namely that things are starting to pick up,” commented Amer Zureikat, Bayt.com’s Regional Manager. “Improvements in the index have been seen in countries in the Middle East for around six months now, so the real test as to whether consumer confidence is being sustained and improved as a result of the easing of the recession, will become evident over the next year or so.”
The CCI is in part gauged by asking the respondents about their personal financial situation, and whether they feel that they are better, or worse off than 12 months ago. In the UAE, 21% of respondents said they are better off than last year, while a slightly lower 40% of respondents said they were worse off – the highest figure amongst all surveyed countries.
Around the region, respondents in Qatar recorded the most positive improvements in their financial positions: 35% stated their position was better than last year. The other countries in the GCC reported slight improvements in personal finances: 29% in KSA and 26% in Bahrain stated they were better off. Following the UAE, and in line with the results of the last wave, respondents in Jordan were similarly hard hit in terms of their personal finances, with 39% stating they are worse off.
Consumer confidence is also assessed by asking the respondents about their consumer expectations and their level of optimism towards the future. While not such a huge increase as in the previous wave, consumer expectations improved in each of the surveyed countries with the exception of Lebanon, which stayed the same. As in the previous wave, the UAE was the country that improved the most, moving up the Consumer Expectations Index (CEI) by 8.6 points, closely followed by Qatar, which moved up by 8.3 points. Kuwait also followed suit, with an improvement of 7.0 points. Bahrain and Saudi Arabia showed the lowest improvements among the GCC countries, moving up 5.1 and 3.1 points respectively.
In North Africa and the Levant, Egypt improved the most in terms of consumer expectations, moving up by 6.1 index points, closely followed by Syria at 5.4 points and Algeria at 4.0.
Optimism for the future was found to reign supreme with many of the region’s respondents. Almost half of respondents, 46%, said that their personal financial position would change for the better in a year’s time, and only 8% said that it would be worse. The UAE’s respondents were only slightly below the average, with 45% stating their position would be better. Most optimistic among those surveyed were respondents in Bahrain: 52% said their finances would be better after a year.
Respondents also felt positive that their country’s economy would improve in a year’s time; 40% said that it will be better, compared to just 19% of those that said it would become worse. While Kuwait topped the table – 51% of respondents said their economy will be better – the UAE was also near the top: 49% stated that things will be better. By contrast, only 14% said that things would become worse. Respondents in Saudi Arabia and Qatar were similarly positive, 47% and 46% expected things to be better after a year.
When asked whether it is a good time to buy consumer durables or not, respondents once again stated they are reluctant to spend: 42% said it was a bad time to buy goods such as televisions or refrigerators, 30% said it was a neutral time, while a fifth agreed that it was a good time to buy.
The survey showed that propensity to consume (PCI) varied from country to country. Moving highest up the PCI by 13.2 index points was the UAE, highlighting a second significant improvement after the country’s jump of 12.6 index points in the previous wave. Kuwait and Qatar also showed significant improvements in propensity to consume, moving up the index 11.1 and 9.4 points respectively. Unlike the previous wave when it showed an improvement, Algeria moved down the index by 5.1 index points – the largest decrease among the surveyed countries. In this wave, Lebanon, which previously witnessed a drop, moved up the index by 3.0 as did Syria by 2.3 points.
“The results show that while customers feel they are in a better financial position, they are still reluctant to part with their money for higher-end consumer items, which suggests that consumers are being cautious – perhaps until economic improvements look as though they are here to stay. In that regard, this data can serve as a useful milestone to measure the changes in consumer spending habits over time,” said Joanna Longworth, Chief Marketing Officer, YouGov.
The Employee Confidence Index (ECI) is a general measure of how people feel about the local job market and highlights their current attitudes towards availability of jobs and salary satisfaction. The UAE showed a positive improvement in this index, moving up by 6.0 points, following from the improvement of 8.1 index points in the previous wave. Showing the most improvements were Qatar and Syria, which moved up by 10.6 and 9.6 points respectively. The picture around the Gulf was also positive: Kuwait and Bahrain moved up by 6.8 and 6.1 index points, while Saudi Arabia showed a less remarkable increase of 2.1 points. As in the previous wave, Lebanon saw a drop in employee confidence, this time by a higher 2.0 index points, while Algeria moved down by 1.3 points. The rest of the surveyed countries all showed improvements.
“In general, the employee confidence index shows that employees feel that their respective labour markets are picking up, with the exception of Lebanon and Algeria. This suggests that recessionary pressures are still being played out in those economies,” commented Longworth. “This data, coupled with ongoing news reports of the global economic downturn coming to an end, suggest that conditions are already better for employees.”
Following on from improvements in the previous wave, a greater proportion of respondents believe that more jobs will be available in a year’s time. Just 28% of all respondents said they feel that job availability will be worse, compared to 33% in the last wave; while 30% of respondents said conditions would be better. Feeling most positive about the future availability of work were respondents in Qatar (43%), Kuwait (42%) and the UAE (40%) who said things would be better after a year. Those feeling pessimistic about the future availability of work were respondents in Egypt and Jordan: 34% in each country said job availability would be worse after a year.
As in previous waves, respondents feel that salary increases have not kept pace with the cost of living. The majority, 60%, said that they haven’t kept pace, while 17% feel they have increased in line with the cost of living.
“Conducting quarterly surveys to gauge levels of consumer confidence presents us with indications about how people are really feeling about many consumer confidence indicators; from whether they consider their salary to be sufficient, how positive they are feeling about the future and whether they feel they are in a position to spend money,” stated Zureikat.
“We therefore want to use this data to enable regional businesses, HR professionals and other relevant industry stakeholders to be up-to-the-minute with these market trends. Taking a purposive approach to the data will ultimately serve to benefit the businesses or organisations of those that use it – enabling them, for example, to retain customers or keep employees happy. In so doing, these steps could prove vital to their organisations’ health in the long term.”
Data for the August/September 2009 Consumer Confidence Index Survey was collected online between 17 August and 8 September 2009 with 9,430 respondents from the UAE, KSA, Qatar, Oman, Kuwait, Bahrain, Syria, Jordan, Lebanon, Egypt, Morocco, Tunisia, Algeria and Pakistan. Males and females aged over 18 years old, of all nationalities, were included in the survey.
Bayt.com is the #1 job site in the Middle East with more than 30,000 employers and 2.75 Million registered job seekers from across the Middle East, Pakistan, North Africa and the globe, representing all industries, nationalities and career levels. Post a job or find jobs on Bayt.com today and access the leading resource for job seekers and employers in the region.
YouGov is a full-service market research company, specializing in qualitative and online research, as well as opinion polling. YouGov has the region’s largest pure research panel of 137,000 members, who regularly respond to surveys. The company has particularly strong analytical skills, with research specialists who have many years regional experience. YouGov acts as a research consultancy for clients on research projects of any size, outsourcing face-to-face and telephone, ensuring the very best service the region can offer. It is a subsidiary company of YouGov Plc in the UK and applies the same online methodology, which has proven levels of accuracy.
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