IHS Markit Index: Employment in companies has reached its highest level since January 2019

The private sector in the UAE is expanding at the fastest pace in two years

The private sector in the UAE witnessed a strong start to the third quarter of this year.


A business survey showed that the non-oil private sector in the United Arab Emirates expanded at the fastest pace in two years during July, as demand rebounded from the "Covid-19" pandemic.

The IHS Markit Purchasing Managers' Index for the UAE, in light of seasonal factors, which covers the manufacturing and services sectors, rose to 54 from 52.2 in June, the highest reading since July 2019.

New orders rose strongly, pushing production up to 57.1 in July from 53.6 in June.

Companies continued to hire employees, bringing a sub-index of employment to its highest level since January 2019, while the increase on a monthly basis was slight, bringing the index to 50.7 from 50.6 in June, which speakers in the report linked to efforts to expand sales departments in Emirati companies, where the rate was Fastest hiring since January 2019. Companies also expanded their purchasing activity in July, after a slight decline in June.

“The non-oil private sector in the UAE had a strong start to the third quarter of the year, as companies experienced the largest rise in new orders in two years, amid rising domestic sales, and a strengthening Confidence in the market, production has increased in line with this expansion.”

Input costs for companies increased in July, on the back of delayed shipments from Asia.

Owen added: “With the acceleration of (Covid-19) cases in Asia, companies have also indicated that supply chain problems are worsening.

In fact, delivery times have been stretched to the limit since the outbreak of the epidemic in April 2020.”

Coronavirus-related measures in other parts of the world led to a third consecutive drop in export sales in July, but the drop was less marked than in June.

The companies participating in the survey continued to expect future growth, while easing the restrictions of “Covid-19” and “Expo 2020 Dubai” contribute to improving economic conditions.

But the survey showed that overall business expectations fell on a monthly basis in July, for the first time in eight months.

• Companies that expect continued growth in the future, supported by the easing of restrictions "Covid-19" and "Expo 2020 Dubai".

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