Many employees working in Qatar believe their pay is failing to keep pace with ongoing increases in the cost of living, according to the results of a recent regional survey of workers’ salaries.

While a slim majority of expats still say they’re better off living and working in Qatar than their home countries, human resources experts say local employers need to address the perceived compensation gap if they want to recruit and retain talented professionals.

The latest study of salaries in the Middle East and North Africa (MENA) by online recruitment company Bayt.com and market research agency YouGov found that 85 percent of Qatar respondents said they felt the cost of living in this country rose during 2014.

However, more than a third (38 percent) said they did not get any increase in their salaries during the year to compensate.

Of those who felt their daily costs had gone up last year, more than a quarter (27 percent) said their expenses had increased by more than 20 percent.

Higher rent, food and utility bills were the key reasons for the increased costs, respondents said.

Looking ahead, 80 percent of Qatar employees predicted their living costs would keep rising throughout this year, compared to slightly more than half (55 percent) who expected to receive a salary raise during the same period.

Residents across the Gulf appear to be expecting a more expensive year ahead, though not to the same extent as those in Qatar. The percentage of respondents in nearby nations who also forecast increased living costs in 2015 were:

• Kuwait (80 percent);
• UAE (79 percent);
• Oman (77 percent);
• Saudi Arabia (75 percent); and
• Bahrain (71 percent).

Citing reasons for their static salaries, 21 percent said it was due to “poor corporate performance and decreased profitability of their company” while nearly a quarter (24 percent) attributed it to a “bad economy,” the survey found.

Economic impact

Falling global oil prices have affected companies in Qatar, particularly in the energy sector where some firms are reining in non-essential spending, laying off staff or implementing hiring freezes.

Meanwhile, Qatar’s cost of living keeps climbing, mainly due to increases in residential rent as the nation’s growing hospitality, healthcare and construction sectors fuel demand for housing.

Real estate experts previously told Doha News that the supply of quality housing is not keeping up with need, meaning residential rent is expected to continue climbing at a rate of 5 to 10 percent throughout 2015.

According to Bayt.com, higher living costs appeared to have had an impact on some employees’ savings, with nearly a fifth of Qatar respondents admitting they saved nothing from their monthly salaries last year.

However this is less than the regional average, where nearly a third (32 percent) said they saved nothing during 2014.

In contrast, nearly three-quarters (74 percent) of people working in Qatar said they managed to send some money home last month, and more than half of all respondents (53 percent) said they were better off in Qatar in terms of their quality of life than they would be if they were working and living in their home countries.

Suhail Al-Masri, vice-president of sales for Bayt.com, said the survey findings showed “a growing gap between the cost of living in Qatar and salary earnings and propensity to save.”

In a statement, he added:

“Most respondents (79 per cent) from across the Middle East and North Africa region are expecting a further increase in the cost of living in 2015. This means that employers must quickly address this widening disparity if they want to effectively tap into the local and regional talent pool.”

Data for the latest Bayt.com survey was collected online from March 30 to April 6. Results were based on a sample of 12,158 respondents from the UAE, Saudi Arabia, Kuwait, Oman, Qatar, Bahrain, Lebanon, Syria, Jordan, Egypt, Morocco, Algeria and Tunisia.

Are you expecting a raise this year? Thoughts?