ROBERT WALTERS WHITEPAPER UNDERSTANDING EMPLOYEE BENEFITS IN THE MIDDLE EAST

ROBERT WALTERS WHITEPAPER UNDERSTANDING EMPLOYEE BENEFITS IN THE MIDDLE EAST

INTRODUCTION A key attraction of working in the Middle East has always been the employee benefits packages on offer but how have these been affected by the economic downturn? Are professionals happy with what they receive and how important are employee benefits when they consider new job opportunities? This whitepaper is designed to provide you with detailed insight into what benefits professionals currently receive so you can compare them against the benefits packages on offer at your employer. There is no doubt benefits packages are extremely important to professionals in the Middle East. Indeed 96% of professionals surveyed said that benefits are an important factor in whether or not they accept a job offer. Even more alarmingly 67% claim they are unhappy with their current benefits package. This research covers three key themes: What impact does length of service in the Middle East have on benefits packages? In which industry sectors are the best benefits packages available? What impact does salary level have on benefits packages? To produce this whitepaper we surveyed a range of professionals anonymously to explore all facets of the benefits package including salary, housing, medical transport and relocation benefits to provide you with detailed insight that you can use as a benchmarking tool. Jason Grundy Country Head Robert Walters - Middle East T: +971 (0) 555 262882 E: jason.grundy@robertwalters.com ABOUT THE SURVEY The Robert Walters Middle East employee benefits survey is based on the responses of professionals working in the Middle East. It aims to highlight the importance of a consistent and competitive compensation and benefits structure and provide useful benchmarking information for employers in the region. The whitepaper explores the following facets of benefits packages: Salary Housing benefit Relocation benefits Travel benefits Educational support Medical insurance Life insurance CONTENTS 01 What impact does length of service in the Middle East have on benefits packages? 02 In which industry sectors are the best benefits packages available? 04 What impact does salary level have on benefits packages? 06 Housing allowance Relocation allowance Educational support 08 Medical cover Are professionals happy with their benefits package? Conclusion

WHAT IMPACT DOES LENGTH OF SERVICE IN THE MIDDLE EAST HAVE ON BENEFITS PACKAGES? Due to the regional crash in the Middle East and the worldwide economic downturn it s not a secret that benefits packages have worsened across the region as businesses attempt to reduce costs. The results of our survey have confirmed this and shown us that professionals who have been working in the Middle East for a longer period of time and as a result joined organisations before the downturn, receive better benefits packages. For example professionals that have worked in the region for over 5 years are more likely to receive a relocation allowance with more generous terms when relocation to the region (89%), educational support (46%), a housing allowance (52%) and life insurance cover (55%). In contrast professionals that have worked in the region for less than 3 years receive worse benefits. Only half of the professionals surveyed (57%) received a relocation allowance and only 36% of respondents receive life insurance. Considering the double digit rise in apartment and villa rents in recent times it s also surprising that of these professionals only 22% receive a separate housing allowance as part of their benefits package. Table 1.0 Length of service in the Middle East compared with benefits package 0-3 years 3-5 years 5+ years Yes No Yes No Yes No Do you receive a separate housing allowance? 22% 78% 33% 67% 52% 48% Did you receive a relocation allowance when you moved to the region? 57% 43% 70% 30% 89% 11% Do you receive flights home? 37% 63% 96% 4% 79% 21% Does your benefits package include educational support? 35% 65% 77% 23% 54% 46% Do you receive medical cover?* 92% 8% 96% 4% 99% 1% Do you receive life insurance cover? 36% 64% 33% 67% 55% 45% *Some employers offer cash within the monthly package to be used by the employee to pay for their own medical insurance. Unsurprisingly the above results have also demonstrated that professionals that have been in the region for 3-5 or 5+ years are the happiest with their benefits packages. Table 1.1 Are professionals happy with their benefits package? Happy Unhappy 0-3 years 68% 32% 3-5 years 72% 28% 5+ years 87% 13% MIDDLE EAST EMPLOYEE BENEFITS 01

IN WHICH INDUSTRY SECTORS ARE THE BEST BENEFITS PACKAGES AVAILABLE? Benefits packages are a high profile topic within the Middle East job market. We are fully aware that professionals compare the benefits they receive to those of their counterparts in other sectors so it s important to know how your organisations benefits package compares. Our research has shown us that professionals working for organisations in the engineering and construction sector receive the best benefits. On average over half of professionals in this sector receive a separate housing allowance (51%), nearly all employees received a relocation allowance when they moved to the region (92%) and 100% provided medical cover. This is in complete contrast to professionals working in the business services sector who don t commonly receive a separate housing allowance (10%), didn t receive a relocation package when they moved to the region (25%) and are unlikely to receive educational support for their children. (35%) Table 1.2 Banking & FS Engineering Professional Business Services & Construction Services Yes No Yes No Yes No Yes No Do you receive a separate housing allowance? 45% 55% 51% 49% 30% 70% 10% 90% Did you receive a relocation allowance? 78% 22% 92% 8% 21% 79% 25% 75% Do you receive flights home? 72% 28% 93% 7% 55% 45% 45% 55% Does your benefits package include educational support? 40% 60% 50% 50% 15% 85% 35% 65% Do you receive medical cover? 98% 2% 100% 0% 95% 5% 82% 18% Do you receive life insurance cover? 54% 46% 69% 31% 57% 43% 60% 40% Are you happy with your benefits package? 84% 16% 62% 38% 83% 17% 50% 50% The quality of the benefits package on offer obviously has a big influence on whether or not a professionals is happy with what they receive. This is the case when examining professionals who work in engineering and construction (62% happy) and in business services (50% happy). However, this trend is not reflected in banking and financial services where the benefits packages on offer are moderate but 84% of staff say they are happy with the benefits that they receive. 02 ROBERT WALTERS INSIGHT SERIES www.robertwalters.ae

84% Percentage of banking and financial services professionals that are happy with their benefits package. MANAGING YOUR BRAND THROUGHOUT THE RECRUITMENT PROCESS 03

WHAT IMPACT DOES SALARY LEVEL HAVE ON BENEFITS PACKAGES? The common assumption is that benefits packages improve as professionals become more senior and earn higher salaries. Our research has shown us that this is true to some extent but not as clear cut as originally might have been thought. The results do demonstrate a strong trend in professionals earning over 60,001 per month receiving better benefits when in it comes to fringe benefits such as medical cover, life insurance and educational support but the benefits relating to relocation, housing and flights home are surprisingly pretty consistent across all salary levels. If we take separate housing allowance as an example, 40% of professionals who earn 20,001-40,000 a month receive some help from their employer with housing and only a marginally higher percentage (49%) of professionals earning over 80,000 a month receive a housing allowance. The same can be said with flights home, 91% of professionals earning between 20,001-40,000 receive flights home while only 88% of professionals earning over 80,000 receive this benefit. However, of the 88% of higher earning professionals, 47% fly in business class when travelling home where as the majority (82%) of professionals earning 20,001-40,000 fly in economy. A more detailed breakdown of how benefits packages relate to salary level is included below. Table 1.3 20,001-40,000 40,001-60,000 60,001-80,000 80,000+ Yes No Yes No Yes No Yes No Do you receive a separate housing allowance? 40% 60% 47% 53% 34% 66% 49% 51% Did you receive a relocation allowance? 72% 18% 71% 19% 95% 5% 97% 3% Do you receive flights home? 91% 9% 77% 23% 80% 20% 88% 12% Does your benefits package include educational support? 20% 80% 50% 50% 52% 48% 52% 48% Do you receive medical cover? 96% 4% 60% 40% 96% 4% 97% 3% Do you receive life insurance cover? 70% 30% 80% 20% 70% 30% 89% 11% Are you happy with your benefits package? 78% 12% 80% 20% 92% 8% 100% 0% 04 ROBERT WALTERS INSIGHT SERIES www.robertwalters.ae

88% Percentage of professionals that earn above 80,000 who receive flights home.

HOUSING ALLOWANCE Despite the continued increase in house prices and rental rates across the Middle East over half (60%) of organisations do not offer their employees a separate housing allowance as part of their benefits package. Housing allowances are most common among professionals who relocated to the Middle East over 3 years ago -52% of those who have worked in the region for more than three years receive a housing allowance, compared to 22% of those who have lived in the region for 0-3 years. Chart 1.4 Do you receive a separate housing allowance? Yes 40% No 60% RELOCATION ALLOWANCE When moving to the region from overseas the majority of professionals received flights and initial accommodation (48%). This was normally organised for them by their employer as only 12% of professionals were given a cash sum to manage their relocation themselves. An unfortunate 16% of respondents didn t receive any assistance from their employer when relocating to the Middle East. Table 1.5 No relocation package offered 16% Flights to region provided 10% Flights and accommodation 48% Cash payment to assist with relocation 12% Professional didn t relocate to the region 14% EDUCATIONAL SUPPORT A large proportion of professionals that work in the region and have children do not receive educational support as part of their benefits package (40%), while 14% have a proportion of their school fees covered by their employer and 13% are lucky enough to have all of their school fees covered. Table 1.6 No educational support 40% A proportion of school fees covered 14% Total school fees covered 13% 06 ROBERT WALTERS INSIGHT SERIES www.robertwalters.ae

60% Percentage of professionals that receive a separate housing allowance. MIDDLE EAST EMPLOYEE BENEFITS 07

MEDICAL COVER While everyone gets medical cover in one form or another most professionals in the Middle East have it presupplied by their employer (96%) with family also included for three quarters of respondents. While the inclusion of life insurance is not as common, almost six in ten professionals receive this. Of the medical cover on offer in the market multi country/region insurance is most common amongst employers with 36% of professionals receiving this benefit. 30% of professionals are lucky enough to receive gold/full insurance covering all regions and dental and optical cover. Table 1.7 None 4% Basic medical insurance (country working in only and no dental option) 20% Country working in only with dental and optical covered 9% Multi country/region insurance offered with some limitations 36% Gold/full insurance covering all regions including dental and optical 31% ARE PROFESSIONALS HAPPY WITH THEIR BENEFITS PACKAGE? The results of the research highlight the importance of adequately rewarding staff. Indeed 67% of professionals are currently unhappy with their benefits package. Chart 1.8 How happy are you with your benefits package Unhappy 67% Happy 33% CONCLUSION Outstanding employees need to be rewarded and correctly compensated to ensure they remain loyal and committed to working at your organisation. If your organisations benefits packages aren t in line with the market norm or comparable to your peers you will find it hard to retain staff in the next 12-18 months as economic conditions continue to improve and the war for talent returns. We predict that benefits packages will become a true tool of differentiation between employers in the coming years, this therefore presents an outstanding opportunity for your organisation to take first mover advantage and develop a market leading benefits package in your sector. In conclusion to ensure you attract and retain the best professionals it s vital you use research such as this to benchmark your organisations benefits packages. 08 ROBERT WALTERS INSIGHT SERIES www.robertwalters.ae

ABOUT THE ROBERT WALTERS INSIGHT SERIES This whitepaper is the fourth in the Robert Walters Insight Series. The Insight Series is a range of thoughtleading whitepapers aimed at assisting employers in their recruitment strategies and helping them address key talent management issues. To register your interest in future topics email contact@robertwalters.com. CONTACT US Should you require any further insight or benchmarking regarding your organisations benefits packages or have an immediate recruitment need, please contact us today. Jason Grundy Country Head - Middle East T: +971 (0) 555 262882 E: jason.grundy@robertwalters.com HOW TO MANAGE THE INTERVIEW PROCESS EFFECTIVELY 09

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