Employee salaries likely to increase next year in UAE

DUBAI: According to a recent report by global consultancy firm Corn Ferry, employee salaries in the UAE are expected to increase by an average of 4.1% in 2026.

Although this rate of salary increase is slightly lower than the 4.2% increase in 2025, according to Gulf News, this increase still indicates that the race to pay better salaries is ongoing among companies, especially at a time when economic activity is picking up and inflationary pressures are increasing.

According to the report, the labor market in the UAE is continuing to strengthen, and employers in various sectors are reviewing their compensation policies to retain skilled people in their companies in an environment of increasing competition.

Rapid population growth in the UAE is also reinforcing this trend. According to statistics, the population of Dubai has reached a record high of four million, while the total population of the UAE has reached 11.44 million.

Dubai is becoming a global hub for the wealthy, but most people who come to the country are looking for jobs.

On the other hand, increased foreign investment and the expansion of local businesses have created new job opportunities in various sectors.

The report said that the demand for experts in specialized fields such as engineering, technology, logistics, finance and accounting remains high, due to digital transformation and growth in diverse directions of the economy.

Vijay Gandhi, Regional Director of Corn Ferry, said that the UAE market has now entered a phase where changes in compensation policies are not made based on a temporary need, but are made according to long-term strategies.

According to him, organizations are focusing on creating the skills needed in the next five years, which requires modern rewards and development plans.

According to the report, the banking, real estate, oil and gas, industrial and retail sectors are expected to see the highest salary increases in 2026, as these sectors are undergoing large-scale investment and adoption of new operational models.