According to the US Labor department, the 533,000 jobs axed in the US in November represented the largest monthly cut since 1974, and the month’s jobless rate of 6.7%, up from 6.5% in October, was at a 15-year high.
With a deepening US recession casting a bleak outlook for employment in the US, at least for the foreseeable future, the question being asked in many markets outside the US is, to what extent will this decline in employment be exported, and will it accelerate, level off, or be corrected in 2009. The US recession, largely acknowledged to have been induced by fundamental failings of the housing markets and credit and financial systems, has already had significant ramifications globally. This has been witnessed by contracted US demand for imports, reduced outsourcing to overseas operations, sharply reduced confidence levels in US and international stock markets as well as real estate slumps and increased unemployment levels internationally.
Will GCC job markets manage to outsmart the escalating unemployment trends both west and east of the region, or will they somehow enjoy a subtle or miraculous decoupling and maintain the unprecedented surge witnessed in recent years? To date no decoupling has been evident, yet nor have the bulk of GCC markets experienced the substantive declines documented in some of the major world economies.
With oil prices hovering around four-year lows, some argue that it is only a matter of time before the reduced revenues to GCC governments coffers cascade down to manifest themselves in contracted economic activity and increased unemployment levels. On the other hand experts at the recent DIFC conference in Dubai argued that oil prices may be back to their former glory as early as 2010, hence the pain will be shortlived and the economic diversification measures enacted across the region in the past decade will act as a viable interim buffer.
Experts attending a recent Doha meeting titled ‘’Unemployment in the GCC Countries: Towards a Strategy to Reduce the Effects’’ indicated that the level of unemployment in the GCC had reached 15%. It is estimated that 300,000 fresh jobs a year need to be provided to address this problem. However in light of the fact that foreign labor accounts for the significant proportion of employment markets across the GCC, particularly in countries like the UAE and Kuwait, the dynamics of achieving robust employment levels domestically may be very different in these markets to dynamics in other markets.
Bayt.com, the Middle East’s #1 job site, which regularly conducts Middle East HR research and polls and caters to over 30,000 employers in the region still supports over 6,300 fresh job opening postings on average a day and fills a similar number of postings through the Search functionality (sensitive and senior executive jobs are usually not advertised). While this is lower than the 7,000 highs witnessed earlier in the year the team stress that seasonality and vacations also factor into play along with general market dynamics in explaining the intra-year differences.
Moreover, bayt.com points out that in leaner times online jobsites are usually the last HR players to feel any degradation as with tightening purses, corporations increasingly look to the bottom line and demand maximized return on their recruitment investment. With their burgeoning global databases, world-class technologies and established track record of fast, easy, effective and cost-efficient professional recruitment at all career levels, established pan-regional online recruitment leaders like Bayt.com are best positioned to offer dynamic recruitment solutions customized for the new market dynamics.
As HR budgets are tightened significantly to accomodate leaner margins, and as corporate and professional recruiters alike look to optimize the quality of talent sourced while maximizing recruitment ROI, the savings and solutions offered by top local/regional jobsites like bayt.com will often make the difference between successful long-term hiring and a waiting-it-out approach. Globalization and economic convergence have meant that economic turmoil in key markets like the US inevitably translate to a shrinking economic pie worldwide.
While the substantive growth enjoyed in the GCC in recent years will not be eroded with government coffers remaining well-padded and fiscal balances strong, it is very likely that in regional employment markets we will see more of what Bayt.com describes as a ‘’flight to quality’’ with employers demanding globally competitive top talent in a market increasingly awash with it.
