Construction salary increases in the GCC region slowed to an average of 6.1% last year, according to a survey by Gulf Talent.

The online recruitment firm said pay rises were lower than the 7.8% recorded in 2014, but that construction still saw the second largest increases of all sectors, after retail which saw a 6.6% rise in 2015.

Gulf Talent’s Employment and Salary Trends in the Gulf report did however warn of the impact of spending cutbacks by regional governments.

“Energy companies have borne the brunt of the slowdown and laid off thousands of staff, while construction firms which depend heavily on government-funded projects have also seen a slowdown in new business,” it said.

Despite this, construction saw a “healthy” average salary increase last year, the report found, as regional companies “sought to remain competitive and retain key specialist staff”.

Construction salaries rose a little more than the average of all sectors, which stood at 5.7% in 2015.

But the Gulf Talent report suggests that the rises across all sectors will be lower this year. “Based on GulfTalent’s survey of employers, salary increases are set to slow down even further in 2016, forecast to average just 5.2%,” it said.

The research report was based on GulfTalent’s survey of 700 employers and 25,000 professionals across the six GCC states.

An increasing number of firms have been reducing headcount, particularly in energy and construction, the report noted. Overall, 14 percent of surveyed firms in Saudi Arabia reported plans to reduce headcount in 2016, compared with 9 percent in the UAE.