UAE’s non-oil job, output levels surge
Dubai, May 23, 2013
While the UAE's non-oil producing private sector reported the fastest rise in employment levels in two years and a further boost in output levels during April, the rate of increase in new orders eased to the slowest in a year, a report said.
While April data marked the 44th successive improvement, the latest reading was the lowest in five survey periods, according to the seasonally adjusted HSBC United Arab Emirates PMI (purchase managers index) - a composite indicator designed to provide a single-figure snapshot of the performance of the non-oil private sector.
The index reached 54.0 in April, down slightly from 54.3 in March, and pointed to a further improvement of operating conditions in the UAE.
Output levels in the UAE's non-oil producing private sector rose further during the latest survey period. Increased incoming new business and improving market conditions were cited by panellists as having contributed to the latest rise.
Order book volumes increased sharply in April, although at the slowest pace in a year, the HSBC survey showed.
Panellists linked growth of new work to improved sales team efforts and good market conditions. New business from international trade also increased at the slowest pace in nine months amid reports of economic slowdowns in export markets.
The UAE's non-oil producing private sector companies indicated a second successive monthly fall in outstanding business during the latest survey period, and linked the decline in work-in-hand to the hiring of additional staff and efficiency improvements.
Meanwhile, suppliers' delivery times continued to improve. There was some anecdotal evidence that the improvement in average lead times was driven by long-term relationships with suppliers and faster payments.
April data pointed to a further increase in employment levels and the rate of job creation accelerated to the highest in two years. Overall input prices rose during April, and at a marginally sharper rate than in the previous month. Purchase prices increased in line with general inflationary pressures, while the rate of staff cost inflation quickened to the fastest in three months.
Meanwhile, output prices charged by the UAE's non-oil producing private sector firms fell for a second consecutive month.
Purchasing activity continued to increase in April, albeit at the slowest pace in a year. Where a rise was reported, companies often linked this to increased incoming new business. Stocks of raw materials and other pre-production inventories were broadly unchanged from March.
Simon Williams, chief economist for HSBC Mena, said: "It's another solid reading that strongly suggests the UAE economy is maintaining momentum well. The softer export reading is a concern, but overall new orders are still strong, employment is rising and output is up.”
“We continue to look for overall growth of around 4 per cent this year, with Dubai likely to be the outperformer,” he added. – TradeArabia News Service