|Published:||12 Jun at 6 PM|
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Expat employees in Qatar to get 30 per cent wage cuts.
As the emirate struggles to get to grips with the economic effects of the coronavirus pandemic, government-funded businesses are being ordered to cut expats’ pay by 30 per cent. All state-funded companies as well as government ministries are being forced to slash expatriate salaries by at least 30 per cent, with the only alternative the laying off of employees via a two-month notice. It’s not just the economic effect of the virus on the emirate’s finances, as the recent decline of oil prices has exacerbated the problems caused by pandemic-driven lockdowns.
The majority of Gulf States are bridging their gasp with a combination of debt issuance and massive spending cuts, with at least $10 billion in debt raised by Qatar in April. The cuts and other measures aimed at Qatar’s expat community are mirroring action already taken by the United Arab Emirates, Oman and the rest of the region’s Arab states, with Kuwait’s prime minister recently introducing a new rule that the emirate’s expatriate population is to be reduced to just 30 per cent of the total numbers.
Experts are concerned that Qatar’s moves to slash expat salaries as well as the numbers of jobs available may well threaten its economic growth by causing labour shortages and cutting off a large proportion of consumer spending. Some 95 per cent of the total workforce are expatriates, with predictions by Oxford Economics suggesting an exodus of just 10 per cent of its population could well have long-lasting effects.
A majority of expat employees work for state carrier Qatar Airways as part of the airline’s 47,000 workers. In addition, expatriates form a large part of Qatar Petroleum and its subsidiaries’ staffing needs, with the company already announcing plans for major job cuts. In addition to pay cuts, expat employees will also be hit with the loss of certain benefits including cash allowances set against vacations as well as flight tickets. Advance payments will also be suspended, except in the case of marriages.
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