Business growth in Dubai has suffered a downturn in the last three months, causing employment constraints in the Middle East’s commercial hub.
As per reports, business opportunities in Dubai for the non-oil private sector have further strained in January, dipping to its lowest level in four years. This brief halt has forced companies to lay off employees, causing a wave of mistrust in the market. In the past four months, Dubai’s big fishes like, Emirates NBD, the city’s biggest bank, Dubai-Islamic Bank, Dubai World, and HSBC have slashed thousands of jobs in recent months.
Note that these entities made headlines because they were too larger companies to ignore. There is no official number of job cuts in SMEs operating there. Based on a conservative estimate, the recent wave of layoffs may have left nearly one hundred thousand people unemployed in Dubai.
According to IHS Markit, Dubai’s Purchasing Managers’ Index slipped to 50.6, almost touching the threshold that separates growth from contraction. It said that the wholesale, retail, as well as construction sectors, have dropped beneath the no-change mark.
Employment in Dubai was notably affected, with companies reporting the joint-quickest fall in job numbers seen throughout the 10-year series history.
The dim outlook is not limited to Dubai as the business environment in the entire country is under pressure. However, experts are hoping that the situation will improve in the coming months.
The only positive for Dubai was its travel and tourism industry that showed a “modest improvement” last month, mainly due to the New Year’s celebrations.
However, with a viral outbreak in China, the tourism sector has also faced a dip in the first week of February. Its revival is crucial for the success of the World Expo exhibition, scheduled for October this year.