The combined effect of inflation, VAT and essentially what amounts to pilot wage freezes is taking its toll.
Since May 2013 (after a 0.5% pay rise that year) there has been no salary scale increase. Flying pay has gone up marginally giving a captain an extra AED 600 per month assuming an average of 75 hours.
Inflation based on government figures has gone up:
2.35% - 2014
4.07% - 2015
1.77% - 2016
2.07% - 2017
Compounded effect therefore 10.65%. This ignores several items that are not included but nonetheless feature in the inflation experienced by the average middle class worker in the UAE.
VAT has produced a consumer cost of approx 7% due to its cost of implementation and its application in many instances.
The effect of this on disposable income is obviously a lot higher. If disposable income was 18% of income 5 years ago then it is practically zero today. Even assuming an individual could save 50% of salary 5 years ago that has now been reduced by over a third.
If one looks at the cost of commodities and services and the salary scales of the last 20 years it becomes apparent that the salary of a first year FO has approximately doubled numerically but the purchase power has been halved.
Example: A first year FO earned approx AED 16,000 20 years ago. At the then price of gold (Approx 300 USD an ounce he/she could buy 14.5 ounces of gold with the salary. Today a first year FO will earn about AED 30,000 per month (Assuming he/she flies a full roster!) and that will buy them approx 6.1 ounces of gold at today's price. Most other commodities show a similar ratio.
Inflation is estimated to be 2.94% this year making any step we may get null and void. We would need a 7% adjustment to salary scales and a step increase in May to simply put us back to May 2016 when we got the last step.
I suspect that is unlikely.