Average salaries in Kuwait are set to rise 4.4 percent this year but employee attrition is still a challenge for employers, Hay Group said on Sunday.

The HR giant said in its annual compensation and benefits report that Kuwaiti workers are seeing "generous bonuses" especially from the prime sectors of oil and gas.

It added that while bonuses were up to 53 percent of salary in some cases, employee attrition is still a challenge for employers.

Story continues below

The 2012 Kuwait report, which was compiled from data from 34,000 employees in 128 Kuwaiti and multi-national companies, also forecast a five percent average pay rise in 2013.

It concluded that Kuwait has the highest attrition rate of GCC countries at eight percent. Attrition is the percentage of employees that leave their employer voluntarily on an annual basis.

It compared to four percent in the UAE, five percent in Saudi Arabia and seven percent in Qatar.

Hay Group's Wendell D'Cunha, the author of the report, said:"The combination of a shortage of national talent and a focus from employers on pay as the main driver of employee retention is contributing to a high attrition rate.

"We would encourage organisations to look beyond pay and to develop their proposition in the areas of career development and look at how they can better support peoples' long term goals and aspirations."

In this year's study 79 percent of employers indicated they were struggling to recruit for sales roles and 63 percent said they are facing challenges filling HR positions. Candidates for marketing, executive management and engineering are also scarce, according to the Hay Group report.

Another finding from the report is the continued polarisation of the oil and gas sector in comparison to other industries.

D'Cunha said: "The oil and gas sector pays significantly higher than any other sector and in doing so, moving to another sector becomes an unfeasible option for employees. Other sectors which pay relatively highly are banking and chemicals which is the pattern we see in all GCC markets."

Nationalisation is also an influential market dynamic with Kuwaiti nationals being paid 30 percdent above the market average while non-nationals are paid at the general market average or below, he added.