Expats are reported to earn approximately £20,000 more abroad than they would in the UK.
That’s one reason why you might see people leaving the UK and heading for sunnier terrain. Another is a perceived higher standard of living. This is especially true when it comes to the Middle East, particularly the UAE. Famous for its oil reserves and the revenue generated from them, expats are flocking to the region for a better salary and a better life —to splash out.
Salary-wise, the first main feature is that income is tax free. On top of that, the average annual pay rise is approximately 5%, and the remuneration tends towards a base salary and allowances, making up roughly 80% of compensation, whereas salary amounts to between 30 and 40% of compensation and there’s more of a focus on long-term benefits. Mobile phones and private medical insurance are also popular options.
The UAE is a main draw, with an expat population of up to 90%. In fact, UAE expats are the higher earners in the region, and boast one the highest per capita incomes in the world. Senior professionals’ take-home pay is the third highest in the world, while the junior professionals are slightly behind in a nonetheless respectable ninth position. It’s hardly any wonder that UAE employers enjoy a good rate of retention.
So where does the money go?
UAE consumers are finally taking to the Net, willing to pay by plastic and make purchases online with their credit cards. Remember that this is in a society that has long preferred cash transactions and, where rent is concerned, payment by rent. Retail has Fashion websites have been particularly popular.
As the region grows and billionaires become more numerous, we may be more likely to see more spending on luxury items, property and foreign education, according to Knight Frank. The rich are also getting richer, on top of that.
This trend in spending is quite in contrast to the UK, where consumers are approaching spending with caution (although they tend to spend more towards pay day). Wary of the economic crisis that has consumed the international economy, concerned about the environment and looking on while we shift further and further towards digital, they’ve become apprehensive about the future.
As a result, emotions appear to be driving their purchases more than practical requirements.
They are, however, spending a lot on domestic purchases such as major household appliances and entertainment. Ideas are the key to self-improvement and success, in the eyes of British consumers.
Interestingly, however, shoppers here may be becoming fans more and more of credit cards or other forms of spending, rather than cash. Research has shown that a sizeable 71% of Brits carry less than £20.00, the average amount being £17.79, an amount which is even less in the case of 18 to 24 year olds, who carried an average of £12.81.
Retail therapy makes feel good, but the manner of buying and the motivations behind purchases are changing as the internet embeds itself ever deeper in daily life. Credit card usage is popular in the UK and is starting to catch on in the Middle East too. After all, convenience is just as important as having the cash.