Skills Shortage Threatens Sustainability of GCC Engineering Projects

Salaries Soar for In-demand Project & Technical Professionals as Developers & Consultancies Endeavour to Complete 3,400 GCC Projects Worth US$2.4 Trillion on Time

Dubai - September 23, 2008

The lack of skilled project and programme managers is not only driving industry salaries for technical professionals through the roof, it is also putting many projects in jeopardy according to ESI International.

Developers are already being squeezed by higher concrete and steel prices, but with escalating salaries on top, many projects are already being delayed with profit margins eroding considerably.

Raed S. Haddad, Senior Vice President of Corporate Programmes for ESI International, the leading provider of project management training and business analysis, is an expert on the attraction and retention of key personnel.

“Perhaps the greatest challenge of all is sustainability,” said Haddad, “Industry leaders in the Middle East cannot simply ‘buy-in’ the expertise they need. To sustain the current level of development, talent must be produced from within, through training and development programmes. The Middle East is leading the world with iconic engineering projects and bespoke skill-sets are not necessarily available in any case.”

Earlier this year, according to database company Proleads, the total number of active projects taking place in the Gulf Co-operation Council countries of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates is close to 3,400 with a total combined value exceeding $2.4 trillion. Civil engineering and infrastructure projects of all kinds lead the way with a staggering 2,081 projects with a combined value of $1.3 trillion alone.

“The sheer scale of all this activity is putting severe strain on the viability of some projects. For example ETA Star Group recently announced that their Dubai Lifestyle City project in Dubail and had increased from an initial US$2.4 billion to US$ 4 billion. The significant proportion of that was put down to ‘opportunist cost’ in consultancy fees which had risen anywhere from 40% – 70%. That maybe so, however the fact remains, if there was enough technical expertise in the market, competition would drive down market rates,” added Haddad.

Haddad now firmly believes that Middle East companies must adopt alternative strategies. “Most regional CEOs recognize that their human resources are their most valuable asset. It is imperative that they now put that mantra into practice. If they don’t the consequences could be severe, delayed handovers, poor quality finish or worse still, negative profit.”

“Organizations are being forced to identify and adopt strategies to develop their existing and future employees. Programmes to develop individuals that will improve their quality of life and their career prospects are as important as the amount they are paid,” added Haddad.

Certain commentators believe that the Middle East market is not mature enough to embrace these policies, historically the private sector has been reluctant to invest in personnel development, concerned that one day those employees may leave and their skills put to use with one of their competitors.

Haddad is philosophical about this, “In reality they have little choice, they had better start examining these issues now, or risk being left behind” he concluded.

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About ESI International

ESI International, is a global project-focused training company, helping people around the world improve the way they manage projects, contracts, requirements and vendors through innovative training in project management, business analysis and contract management. In addition to ESI’s more than 100 courses delivered in more than a dozen languages at hundreds of locations worldwide, ESI offers several certificate programs through our educational partner, The George Washington University in Washington, D.C. Founded in 1981, ESI’s worldwide headquarters are in Arlington, Va., USA. To date, ESI’s programs have benefited more than 1.35 million professionals worldwide. For more information visit www.esi-intl.com.