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Abu Dhabi cost cutting moves send expats searching for new horizons
| Published: | 4 May at 6 PM |
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As the price of oil still refuses to rebound, Abu Dhabi’s stringent cost-cutting measures are causing long-term expat professionals to desert the sinking ship.
One of the world’s major top-paying destinations for expat professionals, Abu Dhabi has long been the pot of gold at the end of the rainbow for a generation of expatriates. It’s the UAE’s most prolific oil producer, with its Abu Dhabi Investment Authority (ADIA) one of the largest sovereign wealth funds on the planet.
Nowadays, however, it’s a different story, with oil prices still at spectacular lows and even ADIA’s managed assets of around $800 billion unable to stop the government’s new austerity measures. The cutbacks are partially the direct result of low oil prices, but are also tied to the introduction of politically sensitive policies once considered taboo in an Arab society boosted by government largesse.
Even the extravagant wage levels of ADIA employees are under threat from the cuts, whilst living costs are soaring, packages are being slashed and government subsidy programmes are being trimmed. State oil company Adnoc has cut some 5,000 jobs since 2015, adding to the high number of redundancies and contract cancellations occurring across the board.
As a result, expatriates who first arrived to take advantage of the boom in the early years of this millennium as well as later arrivals looking for the high life and great job prospects are now either thinking of leaving ot have already left. The emirate’s ambitious programme aimed at transforming its desert environment into a worldly hub for business and upscale tourism is as much at risk from world economic instability as are other far less geographically blessed domains.
One headhunter working with applicants for senior positions told the media 2106 was not only his worst year, it was his worst nightmare. The top echelon of expat professionals as well as the bottom end are both on their way out, leaving the middle levels squeezed in much the same manner as happened in the 1980s and’90s. Even the top-salaried European general managers are leaving and being replaced by less expensive, less qualified staff, he added.
One of the world’s major top-paying destinations for expat professionals, Abu Dhabi has long been the pot of gold at the end of the rainbow for a generation of expatriates. It’s the UAE’s most prolific oil producer, with its Abu Dhabi Investment Authority (ADIA) one of the largest sovereign wealth funds on the planet.
Nowadays, however, it’s a different story, with oil prices still at spectacular lows and even ADIA’s managed assets of around $800 billion unable to stop the government’s new austerity measures. The cutbacks are partially the direct result of low oil prices, but are also tied to the introduction of politically sensitive policies once considered taboo in an Arab society boosted by government largesse.
Even the extravagant wage levels of ADIA employees are under threat from the cuts, whilst living costs are soaring, packages are being slashed and government subsidy programmes are being trimmed. State oil company Adnoc has cut some 5,000 jobs since 2015, adding to the high number of redundancies and contract cancellations occurring across the board.
As a result, expatriates who first arrived to take advantage of the boom in the early years of this millennium as well as later arrivals looking for the high life and great job prospects are now either thinking of leaving ot have already left. The emirate’s ambitious programme aimed at transforming its desert environment into a worldly hub for business and upscale tourism is as much at risk from world economic instability as are other far less geographically blessed domains.
One headhunter working with applicants for senior positions told the media 2106 was not only his worst year, it was his worst nightmare. The top echelon of expat professionals as well as the bottom end are both on their way out, leaving the middle levels squeezed in much the same manner as happened in the 1980s and’90s. Even the top-salaried European general managers are leaving and being replaced by less expensive, less qualified staff, he added.
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