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Skills shortage pushes up Gulf tech leaders’ salaries

Tech executives Unsplash/Christina Wocintech
51% of technology professionals in the Middle East are satisfied with their remuneration, according to a report by recruiter Hays
  • Median salary of tech chiefs is $528,000
  • Long-term incentives expected to improve across region
  • 51% of Middle East tech professionals satisfied with remuneration

Technology chiefs working in the Gulf are typically earning $528,000, according to a new survey, as leadership talent remains “scarce” in the region.

That figure is the median salary calculated by the first annual Middle East Technology Officers Compensation Survey from US advisory firm Heidrick & Struggles.

The report said strong GDP growth in the GCC is helping to sustain high salaries.

Recruitment firm Hays also released a report on Tuesday saying 51 percent of tech professionals in the Middle East are satisfied with their pay.

This is lower than most parts of Europe (63 percent), while considerably more employers (23 percent vs 7 percent) plan to increase overseas hiring than their European counterparts.

“To attract and retain technology leaders, organisations in the Middle East should consider pivoting to long term incentive plans instead of adopting fixed-cash structures,” said Tom Clarke, partner, technology and services practice, Middle East at Heidrick & Struggles.  

Total compensation
Sample size25th percentileMedian75th percentile
Overall41$403,000$528,000$838,500
Company revenue
Under $1bn13$365,500$376,000$551,000
$1-3bn13$453,000$478,000$776,000
More than $3bn12$533,750$763,500$1,485,250
CXO experience
0-10 years18$453,000$558,250$926,000
More than 10 years18$365,500$551,000$876,000
Base salary
Sample size25th percentileMedian75th percentile
Overall 41$275,500$388,000$513,000
Company revenue
Under $1bn13$238,000$275,500$338,000
$1-3bn13$363,000$388,000$563,000
More than $3bn12$419,250$488,000$1,047,000
CXO experience
0-10 years18$313,000$375,500$538,000
More than 10 years18$275,500$388,000$538,000
Bonus
Sample size25th percentileMedian75th percentile
Overall41$90,000$163,000$275,500
Company revenue
Under $1bn13$90,000$90,000$163,000
$1-3bn13$90,000$90,000$238,000
More than $3bn12$163,000$275,500$425,500
CXO experience
0-10 years18$90,000$126,500$275,500
More than 10 years18$90,000$163,000$338,000
Source: Heidrick & Struggles

Meanwhile, the Dubai International Financial Centre (DIFC) has announced plans for the Dubai AI & Web 3.0 Campus, the largest cluster of artificial intelligence and tech companies in the Middle East and North Africa.

It aims to host 500 AI and Web 3.0 companies and create over 3,000 jobs by 2028.

The number of fintech hubs in the region has risen from just one in 2018 to four in 2022: the Abu Dhabi Global Market, Bahrain Fintech Bay, Fintech Saudi and the FinTech Hive at the DIFC.

The demand for talent is likely to continue as fintech accounted for 92 percent of the $445 million in startup funding raised in the Middle East and North Africa last month, according to data compiled by Wamda, the largest early-stage investment fund in the region.

The Heidrick & Struggles survey featured data from 50 GCC-based technology leaders. Many of them work for companies with revenues between $1 billion to $3 billion.

An evolution in compensation structure is taking place, with the discontinuation of some allowances that had been part of Gulf tech salaries, according to the survey.

Historically, companies offered allowances such as housing, transportation and education to both locals and expats to entice them to the region. 

As markets have matured, Heidrick & Struggles said it has seen these allowances eliminated or reduced, or bundled into the fixed element of compensation.

Tom Clarke: The Heidrick & Struggles survey featured data from 50 GCC technology leaders

“We believe that pay structures will continue to evolve in the region as countries continue to transform,” Clarke said.

He explained that further development is required on making long term incentive plans (LTIPs) more common. 

“LTIPs are common in major technology markets. However, they are less so across the Middle East region. We feel that they will become much more frequent in years to come,” he said.

Other newly designed structures being introduced include time-based payouts and milestone payments.

Employee stock option plans are also being used as the startup ecosystem continues to mature and grow across the region.  

Clarke said most senior technology executives in the region are expats. Their expertise is becoming increasingly important as companies across all industries face up to the challenge of generative AI.

In March, Khalil Alami, CEO and founder of payments gateway Telr, told AGBI:

“The historic lack of high-skilled talent and the current skills gaps – nay, a ‘skills chasm’ – within the global fintech industry is directly correlating to the higher costs within the sector.”

Earlier this month, Abu Dhabi’s artificial intelligence company G42 set up a joint venture with Israel’s Viola Group to address skills shortages in the tech sector.

Last year, a PwC survey said Dubai-based software engineers can earn up to 30 percent more than similar workers in rival tech hubs in Europe, due to this ongoing skills shortage.

The majority of respondents to the Heidrick & Struggles survey were located in the UAE, with Saudi Arabia, Kuwait and Bahrain also represented.

Most at the level of chief digital and technology officer work in the financial services, industrials and energy industry. 

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