With a continually developing economy in the UAE, it is not surprising that many workers and employers have been asking the same question: Will UAE salaries increase in 2026?
Current research on the labor force and market predictions have indicated a probable increase in salary, but not necessarily in all industries or occupations.
This article explains which sectors are driving salary increases, how much the average salary rise may be, how employers are reshaping compensation strategies, and what external factors are influencing UAE salaries in 2026.
The main industries fuelling salary increases in 2026 include those related to diversification, infrastructure, and information technology.
The banking sector and financial services remain at the forefront in terms of salary growth with increasing demands in regulation, compliance, and specialized skill sets. Job functions in risk management, compliance, and digital banking are exhibiting resilient salary gains.
The real estate sector is another key driver. Major projects, foreign investment, and a need for project management are all resulting in rising salaries, especially among senior people.
The growth in the industrial sector, construction sector, and oil and gas sector continues with pace due to government projects related to construction and initiatives for an energy transition. Vacancies exist in engineering positions, project managers, and technical experts.
At the same time, logistics roles and supply chain roles are taking advantage of the UAE’s role in being a trade hub in this region. Job-seekers are in short supply because employers are now vying for people with these kinds of jobs who can handle complexities in whatever operations they have.
Areas such as renewable energy, technology roles, and advanced engineering roles are other emerging domains which are contributing towards increasing salaries, especially where specialized talent is in short supply.
A forecast of most markets shows a projected average salary rise of around 4% in 2026. As per common pointers cited in Korn Ferry viewpoints, salary rises are expected to be stable but selective.
Instead of raising wages in all sectors, employers are targeting wage rises in high-demand roles and specialized roles. Experts in AI engineering, data science, cyber security, and advanced analytics are among those projected to gain higher wage rises.
The salary forecast for 2026 shows that employers are focusing on jobs which have a direct impact on revenue generation, digitalization, and resilience.
With the increasing competition for talented professionals, employers have transcended basic salary increment packages.
Current remuneration practices in the UAE have shifted towards making targeted salary increases, in addition to providing non-salary benefits. Such benefits include education allowances, better family support programs, and more comprehensive medical insurance.
Talent retention and employee retention have become interlinked with strategic workforce planning. Companies are spending more time on personal development, talent mobility, and learning programs.
Organizations are presently reworking their reward strategies plan in order to improve organizational capability and allow for leadership succession. Career paths are now considered as important a factor in retaining talented employees as remuneration is.
Some of the external factors influencing remuneration in the UAE include:
Population growth and recruitment of skilled expatriates in the country are intensifying competition in the labour market. Furthermore, economic growth in the UAE non-oil sectors is resulting in an increased demand for human capital.
The GDP in UAE, estimated at a rate of 5.3%, is facilitating jobs in various industries. However, GCC competition is also influencing salary expectations. Saudi Arabia salary increase, Qatar salary increases, and Oman salary increases related to country transformations are pressuring employers in UAE to keep up.
Other key factors are inflation pressure, constant skill shortages, and accelerated AI adoption. Although AI is transforming some back-offices positions, it simultaneously drives a need for operations roles with higher skill sets and digital specialists.
Trends in recruitment indicate increasingly selective employers, with higher remuneration offered only where a difficulty in skill supply is evident.
For employees, 2026 will see an increase in wages, with this being a major boost for specialists and people with industry experience.
As far as employers are concerned, they will face the challenge of ensuring a balance between spending on wages and ensuring worker retention and sustainability in their workforce.
Instead of equal salary increases, the UAE labor market in 2026 will provide skill, flexibility, and value.
Final Thought
So, will UAE salaries rise in 2026?
Yes, but selectively. Wage gains will be most evident in in-demand occupations, specialized jobs, and industries which are major contributors to the UAE’s future economy.
Those employers who can align their talent and compensation strategy will be in a better place to attract and retain the kind of talent they want in the future.
As salary structures evolve and compliance requirements grow, managing payroll accurately is more important than ever. Payroll Middle East supports businesses across the UAE with compliant payroll processing, salary benchmarking insights, and modern payroll solutions designed for a changing workforce.
Our team helps organisations stay aligned with labour regulations, manage payroll efficiently, and support workforce planning as compensation trends shift.
Speak to Payroll Middle East today to understand how the right payroll system can support salary growth, compliance, and long-term workforce stability.