Nakheel, the Dubai Government-controlled property developer, has announced that it has axed 500 jobs. ‘Approximately 15% of the total workforce, which amounts to 500 employees, has been made redundant,’ the company said in a statement.

A statement released by the company said the move was ‘a responsible action in the light of current global market conditions.’

The property market in the United Arab Emirates has been under pressure from the credit crunch as much as anywhere else and this move is further indication that even Government-funded projects in Dubai are not now guaranteed.

‘We have the responsibility to adjust our short-term business plans to accommodate the current global environment. The redundancies are indeed regrettable, but a necessity dictated by operational requirements which are in turn dependent on demand,’ the statement continued.

Many construction workers in Europe and the US are turning to Dubai for potential new jobs, but experience is now required as applications to work in the region are far outstripping the posts available, experts say.

Jason Armes, recruitment consultant Hays’ managing director in Dubai, told the Financial Times that in fact redundancies and the freeze on hiring could combine to see thousands of Dubai’s expatriates leave town.

‘Over the next three months, 5,000 professionals could lose their jobs in Dubai. That’s very significant,’ he added.