41pc ME professionals 'save nothing'
Dubai, August 8, 2011
Some 40.9 per cent of Middle East professionals save nothing from their household income, with the biggest non-housing expenditure being food (40.8 per cent), according to the latest online poll series conducted by the Middle East’s job site Bayt.com.
The results of the ‘Bayt.com Mena Saving and Spending Trends’ poll showed that only 18.3 per cent of Middle East professionals manage to save between 1-10 per cent of their household income.
This comes in line with the latest Bayt.com Consumer Confidence Index survey, in which the overwhelming majority of Middle Eastern professionals claimed that their salary increase was not keeping up with the cost of living.
Poll results also revealed that 32.3 per cent of Middle East professionals spend 21-40 per cent of their income on rent or mortgage with 34.7 per cent spending even more than that. Moreover 66.6 per cent of polled professionals stated they do no currently own any home for either personal or investment purposes while as many as 10 per cent own two homes or more.
Outside of housing costs (which includes rent or mortgage and utilities), 40.8 per cent of respondents claim that their biggest expenditure is on food, and 15.6 per cent state it is on school fees. Transport, travel and clothing rack up a collective 23.6 per cent of costs, with only 1.5 per cent of Middle East professionals spending most on children’s items – the lowest percentage in this category.
“The current distribution of expendable income suggests that in the first half of 2011, the majority of respondents are spending on essential items only, with very little being used towards entertainment and the purchase of non-essential goods,” said Amer Zureikat, vice president sales at Bayt.com. “This correlates with earlier data gathered by Bayt.com, and suggests that the current costs of living exceed the salaries received by most professionals in the Mena region.”
When asked what they would spend extra income on if they had it, 20.2 per cent of respondents stated schooling costs for their children. 18.5 per cent said they would choose to spend any extra money on either a car or travel, with the majority of respondents (57.8 per cent) stating they currently travel once a year. Only 1.4 per cent of Middle East professionals said they would use the extra money to purchase more children’s items.
In terms of shopping preferences, 30.7 per cent of respondents said they prefer to shop in large malls, with 19 per cent preferring large and diversified department stores. As for the shopping habits, the poll reinforced the prevalence of the internet in making regional shopping decisions as well as purchases.
Poll results revealed that only 36.6 per cent of Middle East professionals never compare items online nor buy them, whereas 23.4 per cent of respondents occasionally compare items online but don’t buy them, 14.3 per cent occasionally buy items online, 14.1 per cent frequently compare items online but don’t buy them, and as many as 11.4 per cent frequently buy items online.
When it comes to investments, the overwhelming majority of respondents (43.6 per cent) admitted not being investment-savvy but showing an interest in acquiring this knowhow; 22.4 per cent claimed to be clued in to the benefits of investing, with 19.4 per cent understanding investments to a small extent. Of those surveyed, only 6.1 per cent know nothing about investing, and have no interest in learning.
The poll results show that more than half of Middle East professionals (51.3 per cent) are expecting to retire after 60, with the primary source of post-employment financial support coming from career savings and investments, according to 27.7 per cent of respondents, or from career savings alone for 21.6 per cent of respondents. Only 10.1 per cent will rely on social security pay-outs.
“Our poll shows that there is a definite need for investment education in the Mena region, as there is a significant portion of the population unaware of the available options in the field but showing a willingness to learn more, presumably to increase returns on savings and possibly retire before the age of 60,” concluded Zureikat. - TradeArabia News Service