by Khalid Bhatti 23/05/2016
Thousands of jobs under the axe
Abu Dhabi’ National Oil Co (ADNOC) which has around 55,000 workforce wants to reduce 5000 jobs till Dec 2016. ADNOC already hundreds of job cuts in last few months. According to Reuters, state linked companies will lay off thousands of workers mostly expatriates. This drive to job cuts is part of the austerity plan introduced to minimise the impacts of low oil prices. The layoffs will occur across most of its 17 subsidiaries as part of restructuring that is taking place in the company. Most of the job losses at the state companies in Abu Dhabi involve foreign workers and staff than locals, because government want to limit unemployment among their citizens.
The job cuts and layoffs are contributing to an economic slowdown in the Emirate and even in the Gulf region. The International Monetary Fund (IMF) has predicted Abu Dhabi’s gross domestic product GDP growth will fall to 1.7% this year from 4.4% last year. Abu Dhabi National Energy CO which already cut its workforce nearly 25% in last few years. It has job cuts almost 33% oil and gas and reduce 55% staff at the headquarters of the company. The company reported first quarter loss.
Abu Dhabi state owned companies
Earlier this year, Abu Dhabi based Etihad Rail, the federal government owned company building a national rail network in UAE cut its workforce around 30% in a bid to restructure the company. Abu Dhabi Water and Electricity Authority laid off scores of workers mainly expatriates in last few months. National Petroleum Construction Co, owned by the Abu Dhabi state owned industrial conglomerate Senaat and one of the largest oilfield contractors in Abu Dhabi, is also considering cuts in workforce. Some other companies also following the same pattern and planning to reduce workforce.
If the low oil and gas prices continued its present trend in the long run than more cuts in spending will lose more jobs and axe will fall on the expatriate workers. The austerity drive will continue until oil prices recovered and stabilized. According to Reuters, recruitment firm for oil sector pointed out that “The UAE’s oil and gas recruitment market is set for its most difficult years in over a decade in 2016.The oil and gas industry is still feeling the pain, as was to be expected. Overall redundancies have been on the increase”. Most layoffs at Abu Dhabi state firms are not in response to production cutbacks, the UAE has not reduced its oil output. It is still proceeding with long-planned oil and gas development projects.
The layoffs job cuts are not because UAE is running out of the money
It still has hundreds of billions of dollars in its kitty but the government is using the opportunity to restructure the state owned companies. The government is also reducing subsidies on fuel and electricity to keep the financial situation under control and to minimise the impact of lower oil prices.
In this whole process, the expatriate workers from south asia will suffer the most. They will not only lose jobs but will be under pressure to work on even lower wages. It is the norm internationally that workers bear the brunt of the crisis. The capitalist create such crisis because of their wrong policies and than blame the workers for that. The capitalist tries to keep the profits at any cost and attack the living standards and wages of the workers.
This is exactly happening in UAE and other Gulf states. It is the beginning of a long and painful process in which thousands of expatriate workers will lose jobs and economic opportunities. Thousands of families back home enjoys some sort of sustained income will also suffer. The governments in the region are seems least concerned about the workers and their families. Their own governments are also not interested to help these battling workers.