Almost a third of Qatar’s residents,30%, have cut down on their household expenditure in response to the current recession, matching the average of the countries surveyed around the Middle East, according to the latest study by the Middle East’s number one job site - Bayt.com - in conjunction with research specialists YouGov. The study found that around the region,30% of professionals have cut down on their household spending, while just over a quarter of all respondents have actually increased their household budget.
“In similar research over the past six months, we have seen that many of Qatar’s consumers are cutting back on their spending. Now, despite some signs of optimism at the grass roots level in the global economy, it seems the trend of being more price-conscious looks set to continue - at least in the short-term,” said Nassim Ghrayeb, CEO of YouGov in the MENA region.
When it came down to the reasons why professionals have cut down on their household spending, the recession was the most common answer among GCC respondents, at43%. This was closely followed by cutbacks because the respondents - or a member of their household - had lost their job, at37%. The UAE’s figures were the highest in terms of cutting down household spending due to job loss, with45% reiterating this statement, closely followed by Kuwait at44%, and Egypt at41%. Qatar fared relatively better, with just33% of respondents cutting down their spending due to job loss in the household. For the most part, respondents in Qatar have cut their spending to be on the safe side.
Asked about whether they were willing to settle for a reduced salary in a new job in case of redundancy, only31% of all respondents stated they would be willing to accept a reduced amount of pay, while45% stated that they wouldn’t settle for any less. In Qatar, just over a quarter would accept a lower salary -26%, while the majority,52%, stated they wouldn’t. The figures were similar around the region, with38% of respondents in the UAE and37% in Lebanon willing to accept less salary, closely followed by Bahrain and Jordan at36% each.
The study also asked the respondents how much less they would be willing to settle for, if they were to take up a new position. Interestingly, unemployed professionals seemed far more willing to compromise:49% of working professionals would not accept less than their current package, compared to only27% of those currently unemployed.
“There is a general consensus that the recession is having a sustained impact on the region, which of course manifests itself in the behaviour and attitudes of professionals living and working here. The recession naturally leads to a dearth in liquidity, which is made very clear by the fact that so many residents in the region have limited their spending. By conducting this study, we are shedding light on the extent of these limitations and how, overall, people feel they are dealing with the situation. This gives the region’s organisations valid information about how the recession is being played out - by the people in the heart of the slump,” explained Amer Zureikat, Bayt.com’s Regional Manager.
The ‘Surviving the Recession’ study was conducted to gauge consumers’ opinions on their struggles during the global economic recession, to understand the impact the recession has had on a personal level and how it has impacted consumer spending and savings.
The study asked the respondents about their financial health both before and during the recession to ascertain how many professionals felt their financial position has changed. Prior to the recession,36% of all respondents felt they were better off than their peers,39% felt they were the same, and12% felt they were worse off. During the recession, respondents generally felt their position had worsened: only25% of all respondents feel better off than their peers,39% feel their financial position is the same as their peers, and22% feel it is worse.
In Qatar, the figures changed significantly. Before the recession,40% of respondents felt financially better off than their peers, while only28% of respondents feel better off during the recession.
When asked about the reason for this change in their financial health - more than two thirds of respondents in Qatar -39%, cited it was due to job loss, and17% stated it was due to a salary cut. According to the study, job losses featured most strongly in the UAE (at48%), suggesting that redundancies have been much more widespread in the Emirates.
The effects of the recession on financial health have also spilled over into respondents’ investments.21% of all respondents expect to sell investments to support themselves or their families during the recession: this jumped up slightly to23% in Qatar. Most unaffected were respondents in Bahrain;56% stated they do not foresee having to sell any assets, closely followed by Saudi Arabia and Algeria’s respondents, of whom,48% each agreed their financial position would not reach a point where they had to sell.
Aside from cutting down on expenses, seeking employment in a different country is a popular option among all respondents during the recession; a quarter stated they have moved away. In Qatar, residents have taken a number of steps to deal with the recession: the study found that11% of respondents have sent their families home, and more than a fifth -22% - have found work in a different country from their family.
Physical health was also found to be an issue during the recession;27% stated it has personally caused them health concerns or issues including stress, and13% stated that a family member’s health had been affected. Most affected in the Gulf were respondents in the UAE, with31% undergoing personal health concerns and13% with family members with health concerns. This was closely followed by Kuwait, with29% undergoing personal health concerns and14% with family members affected. Qatar’s residents matched the average in terms of health concerns during the recession;27% stated it had had an effect on them, and16% stating it had affected their family.
“Aside from the financial and job-related concerns that respondents across the region have, what we are witnessing is that the effects of the recession are permeating into people’s lives, to the point where their physical and mental health is affected - something that is not often heard about. This kind of topical, up-to-the-minute and direct data provides a very candid look into how people are dealing with the current economic climate, which gives HR professionals and other industry stakeholders a very plain insight into how the recession is being played out on a grassroots level,” stated Ghrayeb.
“These findings send a clear message to employers that many professionals across the region are suffering at the moment. Taking action to address the issues highlighted may well serve to give organisations competitive advantage - for when the recessionary pressures ease,” concluded Zureikat.
Data for the Surviving the Recession study was collected online between the period of26th May and28th June2009 with12,908 respondents from across the UAE, KSA, Qatar, Oman, Kuwait, Bahrain, Syria, Jordan, Lebanon, Egypt, Morocco, Tunisia, Algeria and Pakistan. Males and females aged over18 years old, of all nationalities, were included in the study.