Source: Muscat Daily 2013
Muscat – Salaries in the sultanate are expected to rise by 5.6 per cent in 2014 against a predicted inflation rate of 3.5 per cent as companies begin to focus more on pay, performance and promotion decisions, according to management consultants Hay Group.
Launching its annual compensation report on Tuesday, Hay Group said that 21 per cent of employees moved up a grade, and that pay rises stand just above inflation indicating an increase in disposable income with employees in Oman.
The average salary increase, according to the report, was 4.8 per cent in 2013, with the oil and gas sector posting the highest pay rises.
Harish Bhatia, Hay Group unit manager for the Middle East, who worked on the report, said, “Inflation is expected around 3.5 per cent, which is one of the main factors that goes into salary increases. But there are various other factors as well, like the economy and government’s focus on growth and commerce in the market. I believe companies know that there is demand and potential in the future, which seems to be as a fair reason for the increase in forecasts.”
Now in its 13th year, the study includes data from more than 120 companies and 40,000 employees in Oman. The report covered 73 per cent national employees and 27 per cent expatriate workers which is representative of the wider workforce in Oman and covers the key sectors of oil and gas, utilities, banking, technology and FMCG, among others.
Bhatia said Oman is one of the markets that is fairly stable, has a high representation of nationals and provides stability to the economy. “The increase in minimum wages over the last two years has had a ripple effect on pay, even at the senior level. Still, employers are not obliged to pay the annual incremental three per cent increase if an employee has fallen below performance expectations, and hence the Oman market has become more focused on performance-related pay. Most companies are paying the minimum increase to both nationals and non-nationals.”