In the Country of Expats

With new business development and an ever-growing population, Dubai is a hotbed of activity for expatriates. HR should do all they can to prepare their employees for the fast pace, heavy workload, and cultural differences they'll encounter. It will help them adjust -- and improve the chances of a successful relocation.

Thursday, October 16, 2008
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After more than a year, Farrell Nicholes is getting adjusted to life in his new home.

The heavy workload. The glaring cultural differences. The endless construction. The traffic.

And who could forget about the 110?degree heat?

"It's been described as seven months of paradise and five months of inferno," says Nicholes, a marine engineer from Orinda, Calif., who works for the San Ramone, Calif.-based oil giant Chevron.

Such is life in Dubai, a state in the United Arab Emirates that has become famous for its transformation from an oil-rich, but desolate, desert nation to a sprawling economic hub and high-end tourist attraction boasting the world's largest shopping mall, an indoor ski resort, islands shaped like palm trees and an ever-expanding skyline soon to feature the world's tallest building.

Companies that do business in Dubai will find a government that is eager to help them establish themselves, but a public that is used to high-quality service and reasonable prices, says John MacDonald, managing director with New York-based global HR and compensation consultancy ORC Worldwide, who lives and works in Dubai.

Because there is so much competition between businesses, "clients are demanding higher and higher quality services," he says. "They are always demanding more cost-effective rates."

From a staffing perspective, companies headed to Dubai are facing a serious talent crisis because businesses are growing faster than the population of workers.

"Skilled and professional people? There just aren't enough to go around," MacDonald says. "People are switching jobs frequently; there's not as much loyalty in the market as there used to be."

To combat the shortage, companies have been raising salaries, he says, noting that the average annual increase is between 10 percent and 15 percent.

The numbers alone help tell the story of runaway growth. Dubai currently has a population of 1.53 million according to the Dubai Statistics Center. From 2006 to 2007, it gained close to 300,000 new residents. Back in 2000, it housed 862,000; in 1993, just 611,000.

Driving such progress and carrying much of the workload are expatriate employees like Nicholes, who make up 80 percent of the population. From Sunday to Thursday (the work week in Dubai), Nicholes works at the Dubai Drydocks, converting an oil tanker into a free-standing platform. When he goes to dinner or the mall, he sees a melting pot of people, from Canadians and Americans in the oil industry to Indians and Filipinos working in construction, and a number of Australians, Chinese, Pakistanis and many others.

"It's a strange environment," he says. "It's not really like working in a foreign country, because it's so transient."

The workload in such a fast-developing country can be daunting, with 12-hour days, then calls and e-mails on the weekend.

"Dubai [offers] a more frantic pace than most areas," he says. "It's kind of like New York City compared to the Eastern seaboard, a little more intense, a little faster and very commercial-minded."

And companies throughout the world seem to be sending more and more people to the region every day, according to Paul O'Malley, a worldwide partner with N.Y.-based HR consulting firm Mercer who works in Ireland but specializes in the Middle East. He's made roughly 40 trips to Dubai in the past two years.

To make sure companies get the most bang for their buck in Dubai, he says, they should be sure to consult with their HR departments to ease the employee's transition.

HR departments dealing with expats in Dubai should be sensitive to their needs and do all they can to prepare them for the fast pace, heavy workload, and cultural differences they'll encounter. Helping them adjust will improve their chances of a successful and long-lasting relocation.

Working with Relocatees

Nicholes worked with Chevron's HR department before his transfer. They gave him a counselor to guide him through the process, as well as written materials on Dubai.

"We try to use our own employees -- who have either had an expat assignment in a particular country or is a native from that country -- to help out an incoming expat," says Kimberly Beman, Chevron spokesperson.

Through this interaction, Nicholes learned about the country's culture, neighborhoods and lifestyle. The company also arranged for a visit before his move.

He also received an overseas premium for working abroad and -- since many products there cost more than they do in the United States -- he got a cost-of-living differential.

While some expats, such as Nicholes, were transferred there, others, like Erin O'Neill, moved to Dubai voluntarily. She says her motivation was to seek opportunity in a land of tremendous growth.

"I chose to come and work here as it appealed to me as a vibrant, exciting place that had endless opportunities," says O'Neill, who hails from Cork, Ireland, and works in the ever-booming hotel-service sector. She has been in the country for 18 months.

With expats from so many different areas, she relishes the chance to interact with people of almost every nationality.

"You are learning from each of them," she says, "experiencing their cultures, beliefs and traditions; in exchange, [you're] teaching them about your own."

O'Malley says many people working in Middle Eastern companies can get a job one level above where they are in Western countries. For example, a manager in the United States could move to Dubai and work as a director.

"There's a lot of money there and a lot of development," says O'Malley. "If you're 25, 30 years of age and very ambitious, it can be an exciting place to be."

The country also allows people to keep their income, since there is no income tax. American expats such as Nicholes pay U.S. taxes for 12 months, but after that time, they do not owe taxes to the U.S. government as long as they are out of the country.

HR professionals, says O'Malley, should be doing everything in their power to help potential relocatees gain work visas; navigate through the high-demand, low-supply housing market; and find education for their children.

HR should also illustrate the cultural and legal differences between Dubai and the West beforehand, he says. For example, alcohol in Dubai is heavily controlled and needs to be purchased with a license.

"Take an English soccer fan after a soccer game, jumping up and down in the street after a match with a beer in his hand," says O'Malley. "That stuff is guaranteed to get you thrown in jail."

State of Flux

Perhaps the most significant challenge for expats is housing, especially in a market where residential development can't keep up with the sheer influx of people, says O'Malley, and rent can cost more than it does in Manhattan. The average price for a three-bedroom apartment is $3,500 per month, according to a study by HR consultant ECA International.

In his search for a suitable home, Nicholes -- a 56-year-old who moved to the country with his wife -- worked with a relocation specialist who showed them different areas of the city and options such as apartments or houses. And they had to make the choice quickly, since Chevron only paid for a hotel for two weeks. Nicholes described the process as "overwhelming."

He and his wife settled on Marriott Executive Apartments, residences that also provide traditional hotel services, such as twice-weekly housekeeping.

As if the market wasn't hard enough, renters must pay a full year of rent up front. HR departments should be sure their employees know that before they get to Dubai and get stuck with the stiff bill, says O'Malley.

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"That can be a surprise for people, so most companies give a loan to employees at the beginning of the year, which they pay over the 12-month period," says O'Malley.

The municipality of Dubai is a city in a constant state of construction, with new skyscrapers going up in virtually every neighborhood.

"It's like somebody decided to build Manhattan, but they decided to do it in six months," says O'Malley. "I stood outside a hotel and, just to amuse myself, I counted the number of high-rise cranes I could see in front of me -- and it was something like 50."

And he was only looking in one direction.

In 2007, there were 2,159 new buildings completed in Dubai -- 1,506 were residential, 327 were commercial and 326 for recreation, services or industry -- according to the Dubai Statistics Center.

The construction is not just limited to buildings, but also includes roadways, making traffic a constant struggle. Many people tell stories of coming to work on one road, then going home on a brand new highway.

Assessing the quality of this fast-changing, fast-paced life in Dubai may depend on whom you ask. Some are workaholics who enjoy the long hours and prosperous returns. Others may enjoy the hands-on service and hospitality in the region, or the tourist attractions such as indoor ski resorts or man-made beaches.

O'Malley calls it a "work-hard, play-hard environment."

"There's a lot of late-night bars in hotels," he says. "Friday afternoon [features] the famous brunches, where basically you go in for brunch and, included in the price, is everything you can drink for the rest of the day."

In a recent study, Dubai ranked highest among all Middle Eastern cities in quality of life, according to Mercer's 2008 Quality of Living Survey. It came in 83rd out of 215 locales.

And although it's located in the turbulent Middle East, Dubai's strict laws give it a high safety rating. In the Mercer survey, Dubai scored in the top quarter of cities in the category of personal safety, coming in 47th.

"It's a very safe country. Iraq is nearby, and that's a very unsafe country," says Nicholes. "The UAE is quite peaceful and quite well controlled. We don't see any of the unrest and discontent that the other countries do."

Business Done Differently

Safe or no, HR leaders should be sure to prepare workers for the many differences in the way business gets done in Dubai. For one, the government of Dubai established a quota stating that 5 percent of the workforce at companies in the private sector must be local nationals, says Muna Alyusuf, a training manager for Europe, the Middle East and Africa for the Danbury, Conn.-based consulting group Cartus.

Workers moving to Dubai and the Middle East should also know they are heading to a country guided by Muslim law. For example, Alyusuf says, leaders at Middle Eastern companies put a premium on family, which can lead to less-stringent work schedules. It is known in Dubai and throughout the Middle East that a person can leave to go watch his or her child's school play or tend to an elderly family member, then get the work done another time, she says.

"There isn't that guilt feeling attached to looking after your personal life while you are at work," she says.

The flip side is that Dubai is a culture with no real separation between work and play, she says. Companies in the Middle East expect you to be available on evenings, weekends and holidays.

Non-Muslim expats should also know that they are expected to follow certain customs in public. During Ramadan -- which was observed from Sept. 2 until Oct. 1 this year -- nobody, regardless of religion, is allowed to eat, drink or smoke outside. All restaurants are closed during daylight hours and there is no place to even purchase a drink of water.

Despite an environment much different than the West, there is little doubt that Dubai will continue to grow.

"The big story out here is the sheer rate of growth in population, business and infrastructure," says MacDonald. "The big question is, Will the bubble burst?"

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