Worker shortage a ticking bomb

Dubai: The UAE's construction sector is in danger of a massive shortfall of manpower that could delay a number of projects, construction sources said.

Major contracting companies are frantically trying to hire as many labourers from South Asia, especially India, within the shortest possible time, to deliver the pending projects in time and bid for the new ones.

More than Dh150 billion worth of new projects was announced by master developers during the last two weeks, on top of the Dh4 trillion worth of projects that are in various stages of development.

"India is the top destination and about 80 per cent of our workers are from India," Bishoy Azmi, chief executive of Al Shafar General Contracting LLC, told Gulf News recently.

"However, we see a challenge in getting the right manpower and within the time. Apart from the logistics side, the higher costs and the availability are two major issues."

Top recruitment officials are frequently travelling to India to try and lure workers, who are shying away due to high inflation, decreasing value of dirhams against a strong rupee, that make the UAE labour market less attractive.

"Each labourer has to pay up to Dh4,500 visa fee, the majority of which goes to the contractors' pocket," Fahbin Anwar, director of Azhar Al Sharq management consultants.

"Of this, contractors get Dh2,000 to Dh2,600 while the rest is divided between the agents. Now most contractors have lowered their fees and some companies have waived the visa fee.

"Some companies have now gone ahead to bear the cost of processing workers' passports and other formalities - such is the extent of demand."

"It is becoming very difficult to source masons, carpenters and helpers from India as they are better paid in their country, while the additional costs that we bear are impacting our operating costs," said a recruitment official.

"We have to invest Dh3,600 to Dh3,900 for a worker. So we try to recover part of it. We have lowered our fees to a certain extent. But if we are forced to eliminate this, then it will have an impact on the project cost," he said.

The amnesty made the situation a bit worse, admitted Azmy.

J.R. Gangaramani, chairman of Al Fara'a Construction, said, "The boom in the Indian economy is adversely affecting the manpower business in the UAE."

Fast facts: UAE will eliminate manpower agents

- The immediate estimated requirement for total unskilled and semi-skilled workers in the UAE would range between 100,000 to 150,000.
-The UAE has now decided to eliminate the middlemen by directly hiring workers from selected countries.
-The move will see the government managing the region's biggest labour supply operations.