Dubai: Monthly job losses in Dubai’s private sector have dropped to their lowest point in nine months, but business activity weakened further during November.
Business owner sentiments too have hit a low point, with more of them worrying about a slowing economic recovery, according to the latest update from IHS Markit. But “news about effective vaccines could restore long-term optimism, as firms are likely to place greater hopes of a strong recovery in 2021,” said David Owen, Economy at the agency.
"Job numbers were stabilising in November, to signal that the impact of cost-cutting efforts on payrolls has started to ease," said Owen. "However, a possible hit to demand from falling customer numbers could lead to another setback for employment in the short-term."
This is a sentiment widely shared by private businesses. Across most sectors, while new job creation is muted, more companies are saying that they haven't gone in for further reductions after summer.
A lot will thus depend on new orders streaming in. In November, new business growth was down to a five-month low, and companies adjusted by lowering output for the "first time in six months", according to IHS Markit, which assigned a score of 49 for November's PMI reading and the lowest since May. (The Purchasing Managers' Index measures changes in output, new orders, employment, suppliers’ delivery times and stocks of purchased goods.)
"Consequently, firms gave an even worse outlook for the year ahead in November," the report adds. "Falling to a new record low, business expectations were also negative for the first time since this series began in April 2012."
Construction firms also struggled, as a "lack of new projects and having to rely on work started before the pandemic" telling on sector fortunes.