JOB CUTS: Nakheel has reduced its workforce by 15 percent as it scales back projects.
Dubai government-owned Nakheel, developer of the Gulf trade hub's man-made palm islands, said on Sunday it had cut 500 jobs or 15 percent of its workforce as it scales back projects amid the global financial crisis.
"We have the responsibility to adjust our short term business plans to accommodate the current global environment," it said in a statement quoting a spokesperson.
"The redundancies are indeed regrettable, but a necessity dictated by operational requirements which are in turn dependent on demand."
Nakheel said earlier his month it was witnessing a slowdown in the rate of real estate sales. Last month it said it had scaled back dredging work on its massive Palm Deira project, the largest of three palm-shaped islands that was planned to house one million people. (Reuters)
This is the second biggest confirmed job cut in the UAE so far, and comes after two developers, Damac and Omniyat confirmed a total of 269 - 200 by Damac and 69 by Omniyat.
All the affected employees were provided a redundancy package, which includes outplacement support services to assist in this time of transition. All other major developers have earlier said they are revising headcount downwards, as business activities in Dubai's real estate has come close to a near halt.
Analysts say this is the beginning of a massive job cut across the real estate market.
"This is not the end, but the beginning and we do not know when it will end," said property analyst Sudhir Kumar, managing director of Realtors' International. "
In a situation like this, when lack of funds cut short economic activities, companies have to tighten their belts. "We anticipate others will follow suit in announcing more job cuts."