Morgan McKinley Hong Kong Hiring Update November 2011

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Hiring Market Update for Hong Kong

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Morgan McKinley Hong Kong Hiring Update November 2011

  1. 1. Morgan McKinley | Hong KongHiring Market Update - November 2011 morganmckinley.com
  2. 2. Hiring Market Update | Hong Kong November 2011 INTRODUCTION Hong Kong’s strong hiring market of 2010 continued well into 2011 with increased levels of hiring seen across the board. Demand was particularly high in sales & marketing and technology within the commercial sector, and risk & compliance within the financial services sector. The insurance hiring market was also robust with actuaries, underwriters and claims specialists remaining highly sought after. Hong Kong’s GDP slowed to 5.1% year-on-year in Q2 2011, a decline from 7.1% in Q1. There was a significant drop off in hiring volumes in Q3 11 within the financial services sector as the European debt crisis, poor U.S. economic data and a decrease in mainland growth affected global markets and Hong Kong significantly. The commercial sector remained relatively buoyant however, with continued growth in the consumer goods industry (specifically retail and luxury brands) due to demand from local and mainland consumers. Though the outlook for Hong Kong’s economy is clouded by the instability of global financial markets, we anticipate this period of low visibility will be short lived. Once the markets regain strength we expect there to be a bounce-back in hiring. We recently surveyed over 1,050 senior level operational and HR managers working across the financial services and commercial sectors in Asia Pacific. As part of our ongoing commitment to keep our clients and candidates up to date with the latest trends in the recruitment sector, we asked them about their hiring plans for 2012 and the challenges they expect to face in the Hong Kong market over the coming year. In this Hiring Market Update you will find a summary of our findings. To make it as relevant as possible to you, the results have been separated into two sections: financial services and commerce & industry. We trust that you will find this information useful and we welcome your feedback. We would also like to take this opportunity to thank our valued clients for their support in 2011 and wish everyone a very prosperous 2012. Nick Lambe | Managing Director | Morgan McKinley Hong Kong T: +852 3907 3931 | E: nlambe@morganmckinley.comAustralia | China | Dubai | France | Hong Kong | Ireland | Japan | Singapore | UK morganmckinley.com
  3. 3. Hiring Market Update | Hong Kong November 2011 KEY FINDINGS Financial Services The majority (75%) of senior level operational and HR managers working in financial services institutions in Hong Kong are concerned that current global uncertainty will significantly affect Asia Pacific as a growth market. More than half (60%) of employers believe headcount restrictions will be a major factor influencing hiring levels over the next 6-12 months. Recruitment strategies appear mixed, with 35% of companies planning to reduce headcount in some areas and hire in others, 29% focused on hiring only and 26% still unsure of their plans for the period. In line with last year’s survey results, talent attraction and talent retention are seen as the main personnel challenges for the coming year. Managers plan to focus on reward & remuneration and training & development to address these issues. Commerce & Industry Senior managers surveyed across commerce & industry were less concerned (45%) about global market conditions affecting growth in Asia Pacific than their peers in the finance sector (75%). Almost half of employers surveyed said they would look to hire within the next six months, with a further 23% unsure of their plans and 20% implementing job cuts in some areas and hiring in others. Of those companies planning to increase their ranks, half believe that hiring volumes will be similar to 2011. Positively, 38% anticipate their hiring volumes will be higher in the next 12 months, compared to the previous 12 months. Mirroring the results of the financial services survey, commerce & industry managers cited talent attraction and talent retention as the main human resources challenges on the horizon. Pleasingly, the percentage of employers concerned about handling redundancies was low at 5.4% (compared to 24% for Hong Kong financial services managers and 14.5% for Singaporean commerce & industry managers).Australia | China | Dubai | France | Hong Kong | Ireland | Japan | Singapore | UK morganmckinley.com
  4. 4. Hiring Market Update | Hong Kong November 2011 FINANCIAL SERVICES Market Trends In our recent survey of senior level operational and HR managers working across a range of financial services institutions in Hong Kong, the majority (75%) are concerned that current global uncertainty will significantly affect Asia Pacific as a growth market. At the time the survey was undertaken, one of the prime concerns was that contagion of the eurozone debt crisis would pull the global economy into a double dip recession. Although EU leaders formalised a deal to tackle the crisis in late October 2011, Italy has since overtaken Greece as the prime Do you believe that current global uncertainty will significantly affect Asia Pacific as a growth market? threat to stability. The escalating crisis was the main agenda item at the recent G20 Summit and should continue to dominate headlines, and finance professionals’ concerns, over the coming weeks. Due to the uncertain economic landscape, it is not surprising that almost 60% of managers believe ‘headcount restrictions’ will be a major factor influencing hiring levels over the next 6-12 months, followed by ‘market conditions’ (56%) and growth, restructuring and other internal change factors (40%). Recruitment Prospects Job cuts and hiring freezes are pushing more and more Americans and Europeans to look east for career opportunities. In fact Hong Kong was identified – alongside Singapore and New York – as one of the top three destinations for those looking to further their careers with a move abroad, in a separate survey Morgan McKinley conducted with 560 financial services professionals in London.Australia | China | Dubai | France | Hong Kong | Ireland | Japan | Singapore | UK morganmckinley.com
  5. 5. Hiring Market Update | Hong Kong November 2011 Although job creation in markets such as Hong Kong is faster than in the west, the region has not been unscathed by the financial crisis. People with experience in more mature markets are warned against the misconception that they will ‘walk into’ a job in Hong Kong. Whilst this is certainly the case for niche skill sets it may not ring true for all types of professionals. Cultural and linguistic skills are more crucial than ever given the increased focus on domestic growth in China and south-Asian countries. Chinese nationals returning home after studying or working abroad are the most sought-after employees; they are culturally attuned and are also perceived as being less costly to hire than someone from abroad, as well as easier to retain. Our survey found that 43% of managers predict that hiring levels across their organisations will be lower in 2012 than in 2011, with 40% expecting levels to remain steady. Recruitment strategies appear mixed, with 35% of companies planning to reduce headcount in some areas and hire in others over the next six months, 29% focusing on hiring only and 26% still unsure of their plans for the period. Of those planning to bring new staff on board, almost all respondents (97%) indicated that they would be offered permanent positions. It appears that the bulk (79%) of this recruitment will be driven by replacement hiring. If further hiring is likely to take place over the next 12 months, what do you think is likely to drive it across your organisation?Australia | China | Dubai | France | Hong Kong | Ireland | Japan | Singapore | UK morganmckinley.com
  6. 6. Hiring Market Update | Hong Kong November 2011 Challenges for Hiring Managers In line with last year’s survey results, talent attraction (50%) and talent retention (47%) are again seen as the main personnel challenges that will need to be addressed by financial services employers in the coming year. Respondents to our survey indicated that they would be considering a range of retention strategies, with reward and remuneration (37%) and increased training and development (41%) being the two most popular approaches to tackling this issue. As 44% of employers expect there to be staff reductions in certain areas, it is likely that only professionals with niche skills sets and/or specialist sector experience that will command salary increases over the next 12 months. Furthermore, bonuses paid within the financial services sector for 2010-11 are expected to be approximately 25-30% down on 2009-10, or even less in some organisations. Almost a quarter of hiring managers indicated that handling redundancies would be a challenging part of their roles over the next 12 months. It was interesting to note that this percentage was considerably higher than the 13% of managers surveyed in Singapore who indicated job cuts would probably be an issue. As a hiring manager, what do you think are the main personnel challenges you will face over the next 12 months?Australia | China | Dubai | France | Hong Kong | Ireland | Japan | Singapore | UK morganmckinley.com
  7. 7. Hiring Market Update | Hong Kong November 2011 COMMERCE & INDUSTRY Market Insight Senior managers surveyed across commerce & industry were considerably less concerned (45%) about global economic uncertainty affecting growth in Asia Pacific than their peers in the finance sector (75%). Hong Kong’s commercial sector has been relatively buoyant in 2011. In particular, the consumer goods industry (specifically retail and luxury brands) is booming off the back of fast-growing demand from local and mainland consumers. The picture is not completely rosy however. The government is adopting a cautious stance, highlighting that the state of the financial markets in Europe and the US has overtaken inflation as a chief economic concern, and that the global slowdown is hurting Hong Kong’s exports. Property is one pillar of the economy which is particularly at risk; home transactions fell for the ninth consecutive month in September 2011 and property prices fell 3% in Q3.1 These jittery market conditions will significantly affect hiring strategies over the next 6-12 months according to 45% of Hong Kong managers. Company and team performance will also influence recruitment (41%), as will growth, restructures and other internal changes (34%). Recruitment Prospects Despite apprehension in the market, the recruitment outlook for the year ahead within commerce & industry is reasonably positive. Almost half of managers surveyed said their companies would look to hire within the next six months (compared to 29% in the finance sector). Unfortunately 10% of respondents only have plans to reduce headcount; double the percentage recorded for their Singaporean commerce & industry counterparts. Do you anticipate that your organisation will be reducing headcount or hiring (or both) in the next six months? 1 The Standard: Tsang warns again as economy, exports slip, 28 Oct 2011Australia | China | Dubai | France | Hong Kong | Ireland | Japan | Singapore | UK morganmckinley.com
  8. 8. Hiring Market Update | Hong Kong November 2011 Of those employers that do plan to bring new professionals on board, half believe the volume of hiring will be similar to 2011. Positively, 38% of respondents anticipate that hiring volumes will be higher year-on-year. It is predicted that the robust consumer goods industry (specific retail and luxury brands) will drive a large proportion of this demand. Challenges for Hiring Managers Mirroring the results of the financial services survey, managers within the commerce sector cited talent attraction and talent retention as the main human resources challenges they expect in the next 12 months. Employers plan to enhance their training and development programmes (60%), increase employee brand engagement (53%) and focus on performance management (47%) in the hopes of retaining key talent. Pleasingly, the percentage of employers concerned about handling redundancies was low, at 5.4%. It appears that more commerce & industry managers in Singapore are bracing for job cuts, with 14.5% flagging it as a challenge they expect to face in the coming 12 months. As a hiring manager, what do you think are the main personnel challenges you will face over the next 12 months? We hope this research has provided interesting insight into future trends within the professional jobs market in Hong Kong. To discuss any of the points raised or your recruitment requirements, please contact Morgan McKinley on +852 3907 3907.Australia | China | Dubai | France | Hong Kong | Ireland | Japan | Singapore | UK morganmckinley.com
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