CW Salary Survey 2016: The results are in
Almost a quarter of respondents to Construction Week’s 2016 Salary Survey have experienced salary delays during the past year, and more than half expect to change jobs within the next 12 months. James Morgan reports
The results of Construction Week’s 2016 Salary Survey have been compiled, and the information collected does not make for especially comfortable reading.
Year-on-year comparisons suggest that the prevalence of wage-related delays has increased, overall job satisfaction has declined, and a larger proportion of respondents are looking to change jobs within the next 12 months. The price of oil, which is currently hovering at $45 to $50 per barrel, has rallied somewhat over the past year. Nevertheless, it remains a far cry from its 2014 peak of more than $110, and the resultant squeeze on market liquidity appears to be adversely affecting remuneration within our industry.
The percentage of respondents who reported having experienced disruptions to their regular salaries in the past year has almost doubled since 2015. Last year, 13.5% of those who completed the survey said that they had witnessed salary delays during the preceding 12-month period. This year, almost a quarter of respondents (22.7%) have faced delays.
The mean average of the delays reported by respondents to the 2016 survey was 60.1 days, a steep increase from 2015’s mean average of 35 days. Delays among this year’s participants ranged from four to 365 days. One respondent reported having experienced two separate salary disruptions during the past year: a seven-month delay, followed by a three-month delay. The individual who reported the longest delay – an entire year – commented: “It has been 12 months so far, and I don’t know what will happen next.”
As was the case in 2015, when asked to describe their salary within a regional context, the most popular choice was ‘average’. However, this year’s survey saw year-on-year increases in respondents who described their remuneration levels as ‘below average’ (24% in 2016, compared to 18.5% in 2015) and ‘well below average’ (8.4% in 2016, compared to just 1% in 2015). Although a larger proportion of participants described their salaries as ‘above average’ in 2016 than in 2015 (20% versus 16.5%, respectively), a smaller number considered their wages to be ‘well above average’ (2.8% in 2016, compared to 4.5% in 2015).
In turn, the overall level of job satisfaction recorded this year has fallen since 2015. When asked to rate how satisfied they were with their employers – with one being the lowest rating and 10 being the highest rating – last year’s respondents reported an overall average rating of seven. In contrast, the mean average rating among 2016’s participants fell to just over six.
Perhaps owing to this combination of increased salary delays, more negative salary perceptions, and reduced overall job satisfaction, more than half (52%) of those who responded to the 2016 survey expect to change jobs within the coming 12 months. Of those who do intend to move on, 83% intend to remain in the GCC region. Of those who are looking to relocate to a different region, Europe is the most popular destination of choice.
It is interesting to note, however, that, when asked to report their basic monthly salaries, the most popular answer among 2016 respondents ($2,001-$3,000) was higher than last year’s most common wage bracket ($1,001-$2,000). Indeed, the 2016 results saw a more equal spread across respondents’ reported rates of pay, with more than four fifths (83.9%) of participants reporting monthly earnings in excess of $2,000, compared to 73% of last year’s cohort.
This year, nobody reported monthly earnings of more than $40,000, compared to two lucky individuals who completed last year’s survey. However, 2% of this year’s respondents reported a basic monthly salary of less than $500, compared to 1% in 2015.
As in 2015, the most common benefit reported by respondents to this year’s survey was air tickets home – a perk that was received by 84.3% of participants. Accommodation or accommodation allowance came in second place (73.6%), followed by a company car or car allowance (58.3%), commission or bonuses (31.9%), and school fees or schooling allowance (20.4%).
Published under the headline, ‘The big freeze’ (CW 590), CW’s 2015 Salary Survey found that the salaries of 60% of respondents had either remained the same – or fallen – during the preceding 12-month period. This year, it seems that the wage freeze within the Middle East’s construction sector has persisted – and even grown.
The salaries of 63.5% of respondents to the 2016 survey have remained unchanged during the past year, compared to 59% of last year’s participants. Perhaps more worryingly, 5.5% of those who answered this year’s questionnaire said that their wages were cut during the last 12 months, compared to just 1% in 2015.
In contrast, 16.7% of this year’s respondents reported receiving a cost-of-living pay rise from their employers, compared to 20.5% in 2015. Just 14.3% of 2016’s participants were fortunate enough to have received a pay rise due to promotion, compared to 19.5% in 2015.
Of the 2016 respondents who had received salary increases, the most common percentage rise was less than 0.5% (23.4%). At the other end of the spectrum, 4.8% of this year’s participants reported pay increases in excess of 20%. Of those whose salaries had fallen during the preceding 12-month period, the most common percentage reduction was also less than 0.5% (51.9%). 11.5% of those who had suffered pay cuts reported reductions of more than 20%.
Wage-related optimism has also witnessed a year-on-year decline. Despite the prevalence of frozen pay, 71% of 2015’s respondents anticipated a pay rise within the following year. Conversely, only 44.4% of this year’s participants expect to receive salary increases during the next 12 months, with 24% of these individuals hoping for a rise of between 5.1% and 10%.
Average working hours within the Middle East’s construction sector appear to have remained largely similar over the past year. As in 2015, the most common category among this year’s respondents was an average working week of 46-50 hours (32.2%). That said, comparison of the results reveals movement within the outliers. In 2016, no respondents reported average working weeks of less than 30 hours, compared to 1% in 2015. Moreover, 3.8% of this year’s participants said that they work an average of 71 hours and above per week, compared to 1.9% of those who completed last year’s survey.
Undoubtedly, certain aspects of CW’s 2016 Salary Survey represent cause for concern. Year-on-year rises in salary delays and wage cuts, coupled with falls in job satisfaction and remuneration-related perception, are not necessarily indicative of a healthy industry. But neither do these findings come out of the blue. The last 12 months have seen significant challenges for some of the region’s largest contracting outfits, and low market liquidity has continued to bite. That salary payments have suffered as a result of these circumstances is unfortunate, but not altogether surprising.
The immediate challenge, therefore, will be to rectify this situation before it does irreparable damage to the Middle East’s construction sector. With more than half of respondents to CW’s 2016 Salary Survey expecting to change jobs during the next year, it seems that the workforce is prepared to vote with its feet. Action, not promises, will be necessary if regional employers are to succeed in dissuading talent from moving on.