UAE Non-Oil Economy Posts Steady Growth in October as Hiring Slows

Business activity increased for the third consecutive month as new projects and strong customer demand boosted production. New order volumes also rose, though at a slower pace than in September, while foreign demand grew only marginally. Companies expanded their purchasing activity, marking the biggest increase since June and helping to stabilise inventories after earlier declines.

Despite strong output, hiring momentum weakened. Job creation slowed to its lowest pace since March as companies grew more cautious about expansion. Optimism about future output also dipped to its weakest level since late 2021, with many firms citing intense market competition and pressure on profit margins.

“Employment remained a weak spot, with October data showing the slowest rise in job numbers in seven months,” said David Owen, Senior Economist at S&P Global Market Intelligence. “Confidence has softened due to market competition and reduced profit margins, even as business conditions remain generally positive.”

Input-cost inflation eased for a second month, registering the softest increase since June. Most businesses reported stable prices, allowing output costs to remain broadly unchanged. However, backlogs of work continued to rise as firms faced capacity pressures linked to new business growth and administrative delays.

Dubai’s non-oil economy showed stronger performance, with its PMI rising to 54.5, the highest in nine months. Growth in new orders supported a faster rise in output. Hiring increased for the seventh month in a row, though at a modest pace. Input prices rose at the quickest rate in six months, prompting some firms to slightly raise selling prices.

Overall, the data suggests the UAE’s non-oil economy remains on a solid footing. While companies are becoming more cautious in hiring and outlook, steady demand and resilient domestic activity continue to support growth.