UAE’s non-oil private sector maintains strong growth and jobs increase

DUBAI, Sept. 5 (Reuters) – The UAE’s non-oil private sector continued its solid growth in August, barely short of an expansion in July which was the fastest pace in two years, according to a survey of enterprises.

The IHS Markit UAE Purchasing Managers’ Index (PMI), which covers manufacturing and services, fell to 53.8 in August from 54.0 in July, remaining well above the 50.0 mark which separates growth from contraction and slightly below the series average since 2009 of 54.1.

The UAE has been hit hard by the double blow of last year’s historic oil price crash and the COVID-19 pandemic, although many restrictions were reduced over a year ago and that the economy has recovered.

Production, a sub-index that measures business activity, rose to 58.6 in August from 57.1 in July, the second consecutive highest value since July 2019.

“PMI data signaled another robust increase in business activity in the non-oil sector in August, as demand continued to rebound after the pandemic. This has increasingly been reflected in hiring decisions for employees. companies, with employment numbers growing at the fastest pace three and a half years, ”said David Owen, economist at IHS Markit survey compiler.

The employment sub-index, which has contracted for 12 consecutive months in 2020 and four months this year, rose to 51.6 in August from 50.7 in July, its highest level since January 2018.

Sentiment for future production, however, was the lowest since March, dropping for the second month in a row as uncertainty around the COVID-19 pandemic and stiff competition weighed in despite optimism around Expo 2020 , the world fair which will be hosted by Dubai from next month. The sub-index remained in expansionary territory, although weak relative to the series average.

“Of the 11% of companies reporting positive expectations, many were hoping to benefit from Expo 2020 later this year, while others cited a general improvement in market conditions as demand recovers,” says the PMI report.

Reporting by Yousef Saba; Editing by Toby Chopra

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