DUBAI, May 5 (Reuters) - Companies across Dubai are cutting fewer jobs than they were earlier this year but new hiring is likely to remain slow until employers are sure the worst of the economic downturn has passed, recruitment executives said.

Thousands of expatriates have lost their jobs in the Gulf trade and tourism hub of Dubai since the financial crisis triggered a real estate crash late last year that brought a six-year economic boom story to bust in a matter of months.

Job cuts will have a direct effect on the economy of the world's third-biggest oil-exporter, where 80 percent of the population is foreign and can only reside there if employed.

''The job cuts are still there, but not as fast as they were in December and January,'' said Ahmed Waarie, general manager at Watson Wyatt Dubai, which provides human resources advice to about 750 Gulf Arab companies.

''Anything related to the real estate development sector was the hardest hit. Sales was the first segment they cut, major organizations have shut down entire departments.''

As scores of projects were shelved and sales fell, developers cut staff and some property sales support divisions at other firms were virtually eliminated, recruiters said.

The United Arab Emirates, a seven-member federation that includes Dubai and Abu Dhabi, does not release regular job data.

Waarie said two major Dubai banks reduced sales teams working in the real estate sector by 90 percent, while sales support at other firms supporting the industry were cut in half.

In December, Dubai-based investment bank Shuaa Capital said it would cut 9 percent of staff in the emirate and bank Mashreq said in February it had laid off 4 percent of its workforce.

Dubai gained worldwide attention with developments such as islands shaped as palm trees and the world map, all visible from space, but residential prices dropped 41 percent in the first quarter from the fourth, consultancy Colliers said last month.

Nakheel, state-owned developer of Dubai's palm-shaped islands, said last month it had delayed its $3 billion mall expansion plans, the latest mega project to be scaled back in the emirate's once booming property sector.