What are the implications of UAE’s increasingly younger workforce?
This year, the average age of the United Arab Emirates (UAE) employee fell below 30 – as revealed by Nadia Global in an interview with The National. A younger workforce can impact the job market in various ways as it potentially influences the availability and market rates of many roles as well as the employability of older employees. Prabhu Ramachandran, founder and CEO of Facilio Inc. also shared with Gulf News that “young workers are changing workplace dynamics to reflect their priorities”. Gallup’s report titled ‘How Millennials want to work and live’ further considers the younger generation to be “exceptionally purpose driven”. Their influence in the gulf will be especially significant in the near future and is expected to reach 75% of the total number of employees in the gulf by 2025.
What do millennials value?
Millennials are part of a generation that values opportunities ahead of salaries. As a result, the younger the workforce becomes, the lower this will likely push down on salary levels. The 2018-2019 Salary Survey and Review commissioned by the Gulf recruiter and training institute Nadia Global stated that remuneration packages in the UAE are also becoming more competitive at a global level and have moved away from expatriate packages where benefits such as housing allowances and schooling were provided. Today, it is becoming more popular for employers to offer all-inclusive packages covering all benefits in line with the current market rate. This has subsequently reduced the pay gap between expatriate and local employees in the UAE – whereby 88.62% of the workforce consists of expatriates and immigrants whilst 11.48% consists of Emiratis.
Rather than focus solely on salaries, millennials instead place equally-weighted, if not higher importance on the diversity of a company – be it gender, age or cultural background. 63% of the region’s entrepreneurs are already less than 35 years of age, according to HSBC’s 2018 Essence of Enterprise report. In terms of what retains an employee in a role, the Deloitte Global Millennial Survey 2019 reported strong correlations between employee retention and “strong company financial performance, community impact, talent development, and diversity and inclusion”. The survey assessed 13,416 millennials across 42 countries and territories, and 3,009 Gen Zs (people born in the mid-1990s to early 2000s) across 10 countries. Such findings are clear indications that there needs to be a shift in mind-sets for profit-driven companies to be able to attract and retain highly qualified millennial employees.
How do millennials work?
The rise of the fourth industrial revolution has placed utmost importance on individuals with skills and expertise in:
- Artificial Intelligence (AI)
- Machine learning
- Cyber security
- Digital marketing
- Data science
Most millennials today are working with technologies that were not taught in school and employers value their ability to apply their transferable technical skills and openness towards digital transformation. The monthly salary for a digital specialist in the UAE currently starts at Dh13,000 at a junior level and up to Dh95,000 for a more senior strategic role. Sectors that have witnessed an increase in salaries are mainly the construction industry, retail, hospitality, healthcare and insurance – whilst the banking and oil and gas sectors have not shown any major increases in pay levels.
Millennials have also voiced their willingness to join the gig economy which consist more freelance and contractual work. In fact, four in five millennials and Gen Zs have put up their hands to join the gig economy, according to the aforementioned survey conducted by Deloitte. While reasons may vary, 50% of respondents have mentioned that the gig economy represents greater opportunities for them to earn more money, enjoy more flexible hours and attain a better work life balance. 61% of respondents have also mentioned that they would take up freelance work to supplement their existing income from their full-time job. However, many millennials have also expressed concerns surrounding the risks of the gig economy such as the predictability of income and the ability to plan for the future. As such, they carefully need to assess such risks before making the move to full-time freelancing or contractual work.
Do millennials embrace or fear the digital age?
With the advent of technology, the impact on jobs is expected to be quite extensive. 49% of millennials believe new technologies will improve and reinvent their current jobs compared to only 15% who fear that technology will make their role redundant. Currently, only 70% of millennials reported that they may have some of the skills required to succeed in the fourth industrial revolution. They also mentioned that they would need to keep being upskilled and trained in order to bring more value to the firm and be up-to-date with the latest trends in the market. In line with this, millennials have become strong advocates for learning and development and have a strong preference for employers who invest in their professional growth.
How do you engage with millennials in your workforce?
According to HSBC Private Bank, the Middle East is currently home to the highest number of millennial entrepreneurs globally with 63% of business owners aged 35 or under. This success is the result of hard work with millennials in region working 12.5-hour days – 2.5 hours above the global daily average. Millennials in the UAE are also more responsive to working hours outside the usual 9-5 business hours in order to facilitate communication with colleagues and clients based in other countries.
At Huxley, our recruitment team specialises in placing candidates with key industry players. If you are a candidate looking for your next career opportunity or a client looking for your next key hire, feel free to contact us at +971 4 436 0400 for a confidential discussion. To learn more about what we do, you can also visit our LinkedIn page.
If you would like to join a company that provides the right training and development for millennials and would like to be part of a successful and diverse organisation, you may also reach out to Salwa at [email protected] from our internal talent acquisition team.