DIAC supports education in areas related to the retail sector including Fashion Marketing and Retailing and Retail Management
Dubai, UAE: The findings of the Workforce Planning Study, which was commissioned by Dubai International Academic City (DIAC) and conducted by Deloitte, revealed that the compounded annual growth rate (CAGR) of retail sector employees in the UAE is 2.61%, a rate expected to exponentially increase in light of Dubai’s successful bid to host EXPO 2020.
The study, which covered over 2,400 students across 17 markets in the Middle East, Africa and Asia, alongside a cross-section of companies, also revealed that the anticipated increase in manpower demand within the retail industry faces some key challenges, primarily a shortage of critical skillsets. 24 per cent of companies surveyed state that lean operations and mall management skills are the skills most lacking amongst senior level employees, while 44 per cent of companies report customer psychology and buying behaviour, as well as category management skills, to be the most crucial skill gap evident amongst mid-level professionals. For entry level employees, customer service skills are underrepresented.
Dr. Ayoub Kazim, Managing Director of Dubai International Academic City and Dubai Knowledge Village said:
“DIAC’s Workforce Planning Study is a useful tool in enabling us to better support Dubai’s industry growth. With our survey findings we are able to directly inform the market about skills gaps and trends in the growing retail industry so it can confidently prepare for the future. More generally, we see an important role for us in bridging the gap between employers and academia. Our mission is to close the skills gap that would otherwise threaten Dubai’s continued growth.
Many of our universities offer various degrees in fields related to the retail sector, including Heriot-Watt University, offering a BA in Fashion Marketing and Retailing; Institute of Management Technology, offering a BSBA in Retail Management; and Amity University, who offer an MBA in Retail Management. Supporting the sector-specific education is a step towards addressing the skillset shortage issue.”
The projected growth of manpower demand within the UAE’s retail sector results from exponential growth across the industry as a whole. The UAE is the most mature retail market in the GCC, with a retail trade size of US$ 38.1 billion (2010); significantly larger than KSA at US$ 23.7 billion, Qatar at US$ 8.9 billion, and Oman at US$ 5 billion.
The UAE’s retail sector is estimated to increase by 32.9% by 2015 from AED 114 billion in 2012 to AED 151 billion, according to Dubai FDI’s latest report. Influencing factors include: high disposable incomes; retail real estate expansion and the continued construction of shopping malls and hypermarkets; a steady inflow of international retailers; population growth; and the rising importance of fashion amongst the consumer segment which has led to a steady growth for luxury retail. Sales growth for the GCC luxury goods market is expected to outperform global counterparts with a CAGR of +8.5% from 2010 to 2015, which has contributed to driving overall retail sector growth. Out of 323 major international fashion retailers, over 50 per cent had a presence in in Dubai in 2013. Today, Dubai is considered by CBRE to be second only to London for global retail.
The retail sector growth has been highly supported by strong performance at the Dubai Duty Free (DDF), the world’s largest single-airport retailer. According to the DDF, their sales went up by 11.4% year-on-year in 2013 to AED 6.65 billion. Furthermore, DDF has recently expanded with a 2,500 square metre retail space at the new Al Maktoum International Airport, which when fully operational will be the world’s biggest airport.
Dr. Ayoub Kazim added:
“Dubai is rapidly transforming into a smart city and leading retail destination. We have witnessed the entrance of global retailers and, more generally, foreign direct investments worth US$ 14.4 billion in 2014, led by several factors including Dubai’s central location, economic competitiveness and ease of doing business. The retail sector has been supported by Dubai’s marketing and promotional initiatives, such as the Dubai Shopping Festival, a period which, for some retailers, realises up to 30% of annual revenue.
A new area of focus for Dubai is fashion, particularly high-end fashion and the emergence of designers from the Middle East on the global stage. This has led to the launch of Dubai Design District, or d3, which is aims to act as a hub for the international fashion, design and luxury industry, and a catalyst for innovation. We at DIAC are committed to support Dubai’s growth by facilitating the education necessary to provide the required skilled manpower.”
Dubai’s winning the bid to host the EXPO 2020 is expected to be a major catalyst for development across all industry segments. Oxford Economics estimates that the win will create more than 277,000 job opportunities in the UAE between 2013 and 2021.