GCC workers see pay rises in 2026 amid talent shortages and AI skills rush

The Gulf’s hiring market is set to remain resilient into 2026, with strong employer demand, rising salary optimism and accelerating adoption of artificial intelligence, according to the latest Hays GCC Salary Guide.

However, persistent skills shortages and intensifying competition for talent are forcing organisations to rethink how they attract, develop and retain employees.

The Hays GCC Salary Guide for 2026 provides a comprehensive analysis of hiring trends across the Gulf Cooperation Council.

The annual guide covers salary data for almost 400 roles across 11 sectors and draws on survey responses from more than 1,600 employers and professionals across the Middle East.

GCC salary guide

Oliver Kowalski, Managing Director at Hays Middle East, said: “Despite ongoing global economic uncertainties, the Gulf region continues to demonstrate resilience and forward momentum. Economic diversification, strategic fiscal reforms, and investment in non-oil sectors have positioned the GCC as a hub of innovation and opportunity.

“With projected GDP growth of 4.6 per cent in 2026, the region is entering a new phase of transformation; one that is increasingly driven by technology, sustainability, and human capital.”

The report shows hiring momentum remains robust across the Gulf. In 2025, 66 per cent of employers increased headcount, while only 13 per cent reported no major hiring plans for 2026.

Demand is strongest for technical and digital specialists, leadership roles, and flexible staffing solutions to meet project-based requirements.

At the same time, talent shortages remain a critical challenge. According to the survey, 90 per cent of organisations reported skills gaps in 2025.

Employers identified low salaries and benefits, cited by 38 per cent, high competition for talent at 31 per cent, and lack of career progression at 28 per cent as the leading causes.

As a result, competitive hiring increasingly depends on offering attractive benefits packages, clear career development pathways and a positive work environment.

Salary confidence has improved across the region, with 58 per cent of professionals receiving a pay increase in 2025, up from 51 per cent in 2024.

Despite this improvement, 60 per cent of professionals said their pay does not match their level of responsibility, highlighting ongoing pressure on employers to balance cost control with retention.

Nationalisation

Nationalisation continues to be a top priority across the Gulf, with organisations shifting focus from meeting quotas to retaining and developing national talent.

In the UAE, Emiratisation targets for skilled roles have increased to 10 per cent, with 42 per cent of companies planning to grow Emirati headcount in 2026.

In Saudi Arabia, 93 per cent of employers currently employ Saudi nationals, and 75 per cent plan to increase Saudi headcount this year.

The report also highlights rapid growth in workplace use of artificial intelligence. Around 66 per cent of professionals already use AI regularly at work, citing benefits including improved creativity, productivity and communication.

As adoption accelerates, digital capability is becoming a core requirement rather than a differentiator.

Overall, the findings point to a labour market growing faster than the available talent pool. Employers are hiring proactively, but skills shortages, rising pay expectations and nationalisation requirements are reshaping recruitment strategies.

With AI adoption moving quickly, organisations that invest in skills development, career progression and strong employee experiences are expected to be best positioned to compete in 2026.