Whilst our industry remains vibrant and exciting in so many ways, there is no denying that the last couple of years have been somewhat challenging for the event sector (and many other key industries).
After the global economic downturn there was no big bounce back in the Middle East; with headcounts and budgets cut we saw a slow but gradual rise back to acceptable levels of trading, albeit at in a smaller, more cautious marketplace. Everyone worked hard to win back the business or change direction to attract new clients, and skip ahead 5 years and before the alarm bells even had time to ring, staff numbers are almost back to pre-recession high’s, spending was up and we’d forgotten all about our hardships. Expo2020 drives our optimism and fires us up for a bright future. Cue weakening oil prices, threat of and actual terrorism, war and a widespread immigration crisis, Brexit fears that quickly became reality, and the exposure of other weaknesses in global markets, and what do you know? Companies realise they are overstaffed again, and cashflow is worrying. It’s like Groundhog Day. Where’s our trademark positivity to blow away the dark clouds?
I really thought lessons had be learnt from those few tight years after the bubble burst and it became evident that the ME region was not untouchable. For a short period it seemed as though the realisation that keeping lean and trading with a new strategy, different leaders and extreme caution were an essential a part of doing business here, had made a lasting impression. In other world markets, namely the UK, austerity measures were felt across most of the population, inflation and cost of living rose, salaries were cut, housing markets stalled. On the plus side sales of Prosecco and M&S £10 meals for 2 soared; Staying in was definitely the new going out.
What happened in Dubai was another story though. While times were tough, and yes there were many that downsized, tightened belts or unwillingly left the region to return to home shores, in general, going out with an Entertainer voucher was the new going out!
Employers (myself included) became guilty once more of over-hiring and overspending, and suddenly it became apparent that there wasn’t enough work to go round, and that’s where we come full circle.
I for one am an eternal optimist and you can’t knock our sense of fun and love of life, that alone can keep the world turning, but we need to balance this with reality. We have not seen the cut backs that other ‘normal’ markets have, we still live in sea view apartments or leafy green compounds, dine out in one of the celeb restaurants, brunch each weekend, holiday in Sri Lanka and take ‘staycations’ to nearby 5 star hotels.
This isn’t a dig at anyone person or group of people, and I don’t mean to generalize, I’m guilty myself of imagining a market bigger than it really is, but clearly the Middle East region is still emerging, evolving and needs time to properly stabilise, and what we are experiencing at the moment, a prolonged period of budget cuts and drawn-out but careful recruitment processes is just the way it is.
From where we sit on the recruitment coalface we are finally starting to see that ‘normalisation’ is on the horizon. Candidates that were on decent (sometimes over-inflated) salaries for the last few years, but who lost jobs and haven’t been lucky enough to secure a new one yet, are actually moving out of their luxury accommodation to more affordable places, which is leading to the inevitable urban sprawl and the much needed population of some of Dubai’s ‘less-central’ but no less appealing residential districts.
They are willing to look at lower salaries, because that is the reality of the situation. The longer they go without any salary at all the more it becomes apparent that a job and stability is way more preferable to the absence of both they are experiencing, and how that makes them feel. Salaries are being squeezed to what is a ‘normal’ level. I’ve been saying for many years that hardship postings were a thing of the past, and that pre-recession salaries were not sustainable and therefore a reduction in salaries is inevitable and necessary. It’s unnerving to some, but good in the long term that this change is upon us.
This is how it is now, the way the markets are, our economy is, and we have to accept it, and realise that it’s not so bad; a bit of austerity never hurt anyone, after all, it’s reality, it’s normal.
For further information on salaries in the Middle East, see our annual report here and keep an eye out for our latest report coming soon